Online Ads Make More Money Than TV

By Patrick Coffee 


Oh, look: another shot has been fired in the TV vs. digital debate.

This week David F. Poltrack, Chief Research Officer at CBS, told Variety that digital is more profitable–at least on a per-viewer basis. Why? Channel surfing–or lack thereof.

“If you stream our programming online, you’re seeing a full complement of advertising – you can’t bypass it.”

The total, per viewer, is 10-20% more ad revenue for a single streaming program as opposed to one airing live. And Poltrack expects that divide to grow larger.

The only reason the number isn’t already higher is that much of the highest-quality content isn’t available for streaming. Of course, viewers who stream tend to be younger and more valuable to buyers as well. Here’s your key quote:

“…brand recall and recognition rates are higher for Internet video than TV”

And despite all the trend stories about cord-cutting and a lack of consensus around a single show (sorry, American Idol), total viewership for top programs is just as high today as it was three decades ago.

Of course, CBS will never downplay the value of ads aired on live TV. The number of viewers in a recent audience survey who say they’re spending more time in front of the tube than they did the year before is 10+ points higher than the number who said they’re watching less.

All this talk of young people and their Twitter is at least a little misleading. As we grow older, we watch more TV. That trend won’t change.

Unfortunately, researchers have yet to find a solution to the biggest challenge in online advertising: switching up those damned Hulu spots.