CBS' Moonves: Political Ads Will Save 4Q

by Wayne Friedman, Sep 18, 2008, 7:31 AM

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Major TV network executives say advertising at their respective local TV stations remains a tough business--but one executive said a silver lining comes with political advertising. CBS Corp. President/Chief Executive Officer Les Moonves expects that $150 million in political ad revenues in the fourth quarter will be funneled into its local stations and affiliates in the next several weeks.

This is especially true in big presidential markets, such as Pennsylvania, Ohio and Florida. Moonves was speaking at the Goldman Sachs Communicopia Conference on Wednesday.

Analysts have noted that political advertisers are expected to pick up steam in the coming weeks. Issue-oriented political advertisers and so-called "527" political groups are now able to advertise within a 30-day period leading up to elections. Many of those political advertisers were not allowed to do this in previous races.

At the same conference, News Corp. Chairman/Chief Executive Officer Rupert Murdoch said local TV advertising was "bad," noting that automotive advertising at the Fox station group was down 40%.

Moonves, like Murdoch, was upbeat about network TV advertising: "The world was very surprised by the upfront [advertising market]. We had high single-digit [price] increases. The volume was stronger than people expected. The cancellations [for the upfront] have been minimal and consistent with what it has been in years past."

Moonves, like Murdoch, also said that fourth-quarter scatter prices remained strong.

For the 2008-2009 broadcast TV season, Moonves notes that advertisers will get a better analysis of how TV programs and their commercials have performed--receiving a true apples-to-apples comparison of the C3 ratings metric. C3 ratings are so-called commercial ratings plus three days of DVR playback, a viewer measurement that was instituted last season.

Along those lines, he adds, new research suggests that TV viewers with DVRs are only fast-forwarding through commercials 50% of the time. Older research has suggested that viewers have been fast-forwarding through ads up to 75% of the time.

For all CBS digital businesses, including its CBS Interactive divisions, Moonves says revenue will hit $650 million this year. Moonves noted that very little of these revenues are coming out of network TV budgets. "It is clearly coming from print and other media," he said--although he did add that a little may be coming at the expense of radio.

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