ZenithOptimedia: TV's Dominance Is 'Over For Good'
"Television's share of ad expenditure is leveling off as the Internet takes over as the up-and coming advertising medium," says ZenithOptmedia Group in its new report, "Television In Western Europe To 2014. "The migration of audiences from general television channels to cheap specialist channels is holding down costs per thousand, and in some markets [digital video recorders] are making it easy for early adopters to skip or speed through ad breaks."
ZenithOptimedia has indicated similar trends in its U.S. TV tracking report previously and is expected to release an update on the U.S. marketplace this summer.
"I do think a lot of the trends in [the Western Europe report] are trends we obviously are seeing in the United States," acknowledged Bruce Goerlich, executive vice president-director of strategic resources at ZenithOptimedia Group.
If so, that might suggest the U.S. TV marketplace may also be hitting the wall. In its new report, the agency notes that "subscription revenues exceeded ad expenditure for the first time in 2005" in Western Europe.
"For many years television steadily increased its share of Western European ad expenditure, as public broadcasters and commercial monopolies gave way to fierce competition among commercial channels, unlocking plenty of extra value for advertisers."
Those trends, however, have reversed themselves as marketers begin turning to other sources, especially online, and as TV comes under siege from DVRs, video-on-demand, and other consumer-controlled digital media technologies.
The shifts are so profound that Western Europe's TV ad expenditures shrank 10.3 percent between 2000 and 2003, and ZenithOptimedia does not expect the TV ad market to return to its 2000 level until 2008.
"Expenditure grew only 0.3 percent in real terms in 2005," notes the agency. "The World Cup will stimulate some extra expenditure, but we forecast real growth will only rise to a below-trend 2.2 percent in 2006."
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