TV’s Advertising Outlook Gets GloomierBy
U.S. TV networks are struggling to increase advertising sales this year as more viewers opt for online streaming services over cable or satellite packages, according to the research firm eMarketer.
The forecaster lowered its 2017 estimate for U.S. TV ad sales to $71.7 billion from the $72.7 billion seen earlier, projecting growth of just 0.5 percent from a year earlier. Annual growth won’t top 3 percent in the next five years, and TV will dip beneath 30 percent of overall U.S. media spending by 2021 as online alternatives grab a larger share.
TV networks led by CBS Corp. have managed to squeeze additional dollars out of Madison Avenue by charging higher rates for shrinking audiences. But the dual threat of cord nevers, people who’ve never paid for a pay-TV package, and cord cutters, people who cancel their package, imperil the growth of years past.
The number of people watching TV through cable and satellite providers will drop by 3 million to 4 million people a year between now and 2021, eMarketer estimates.
“Last year, even the Olympics and presidential elections could not prevent younger audiences from abandoning pay TV,” Chris Bendtsen, senior forecasting analyst at eMarketer, said in a post.