The sprawling Nexstar station group, which operates affiliates of all major networks, is exploring a sale once again. A 2007 effort was scuttled as the economy weakened. Moelis & Co. has been retained as an advisor. Goldman Sachs held the role the last time. Nexstar says it now owns or operates 63 TV stations in 34 markets and reaches approximately 11.5% of all U.S. television households. It owns or manages stations that include the sizable Salt Lake City market and the tiny St. Joseph, Missouri DMA, as well as dozens in between. In May, it brokered a long-term affiliation agreement with ABC for nine stations. Earlier this month, Nexstar completed the acquisitions of two CBS affiliates in Wisconsin and Michigan from Liberty Media for $20 million. The company, which posted a first-quarter loss on a slight revenue gain, says it has no timetable for a sale or another financial maneuver. Nexstar reported revenue of $313 million last year. Under CEO Perry Sook, Nexstar has been a pacesetter in pushing cable/ satellite/telco TV operators to pay retrans consent dollars to carry its stations. Nexstar, which like every station group has been trying to upgrade its digital activity, said last week it had acquired GoLocal.Biz, which will be used to offer local directories, coupon services and entertainment listings to company community Web sites. Noting that three other station groups -- McGraw-Hill, Freedom and Young -- are for sale, Wells Fargo analyst Marci Ryvicker wrote: "While there is significant supply, we believe potential bidders will include both strategic and private equity groups -- both of which we believe are looking hard at these assets."
NBC Universal is getting into the private digital ad exchange business. NBC Universal says the move is to reduce the reliance on third-party ad exchanges -- which have been criticized for driving down CPM user pricing. Private ad exchanges can work better for premium digital sites, where they can set specific price limits. This move would help NBC's family of sites and premium video digital site, Hulu, of which NBC Universal is a partner. NBC says private exchanges will provide clients with direct access to premium display ad inventory that can be targeted at scale across the NBC Universal Audience Platform, NBC's own digital ad network. "One of our main goals in launching the UAP was to take better control over our uncommitted digital ad inventory and dial back our reliance on third-party ad networks," stated Peter Naylor, executive vice president of digital media sales, NBC Universal. "By launching this private exchange, we can work directly with our agency and media partners, offering them better pricing, more informed and targeted advertising buys," he added, "and the opportunity to deal directly with trusted and premium content sources." NBC will use technology from Admeld to monetize its ad inventory in a controlled, real-time bidding system. NBC says with its new private ad system, premium platform publishers can target their most valuable audience segments, as well as restrict access to a select group of buyers. They can also set granular rules around pricing. NBC Universal's Audience Platform says its inventory is sold solely by targeting audiences and not by specific Web sites, using top data providers including BlueKai, Nielsen and Quantcast.
NBC Universal and Comcast Corp. have given their combined $1.4 billion-plus media-buying and planning business to GroupM's Maxus and Publicis Groupe's SMG. Group M's Maxus seems to get a bulk of the somewhat surprising win -- getting all of NBCUniversal's domestic properties -- television and film work for Universal Studios. GroupM's MediaCom will continue to represent the company's media interests outside the U.S. Putting the business at WPP Group's Maxus makes sense to some. Several of the WPP media shops have studio accounts that conflict with Universal. MEC, for example, handles Paramount, while MediaCom has the Warner Bros account. Mindshare services Summit Media. SMG adds to its Comcast's MSO work, with the NBC Universal theme-parks business. Comcast Corp. cable operators' businesses media-buying had been handled by Starcom MediaVest Group's MediaVest unit. The move to consolidate has been in the works since Comcast Corp. completed its majority ownership deal in NBC Universal earlier this year. In a statement, NBC said: "The decision to consolidate our media agencies was made in order to streamline the way our companies conduct business." Omnicom's OMD was the incumbent for the Universal Studio business, and Horizon Media for NBC Universal's TV-buying business. Fallon has handled NBC media planning. Ignited USA handles NBC and Universal Film's digital media-buying and planning. Digital media was not part of the Comcast media review. Earlier this month, it was revealed that Omnicom wanted to team up with Horizon in an unusual deal to retain that business and win a greater share of Comcast. Omnicom hoped to pick up business without jeopardizing its existing CBS and Showtime Networks by starting up a separate entity called OH.
Publicis Groupe, the Paris-based ad agency holding company, on Thursday reported an 8.5% rise in net income to $328 million for the first half of the year on a 6.3% gain in revenue to $3.8 billion. The company recorded $2.4 billion in net new business wins worldwide during the first six months, including new awards by Microsoft and Disney to Starcom MediaVest Group and an assignment by JP MorganChase to ZenithOptimedia, among a number of others. Revenue growth in the second quarter dipped to 2.7%, for a total of $2 billion, which the company blamed on the negative impact of exchange rates. It also noted what it called a "temporary slowdown" in global economic growth during the second quarter but stressed that for now, full-year economic forecasts remain unchanged. Organic revenue growth (exclusive of acquisitions and divestitures) for the first six months of the year was 7.1%. Commenting on the results in a statement, Publicis Groupe CEO Maurice Levy characterized the company's organic growth so far this year as "excellent...This confirms the validity of our strategic choices." In a webcast addressing the first half, Levy also touched on succession plans, which he said were proceeding apace. In June the company raised the mandatory retirement age limit from 70 to 75 for executive officers and members of the board. Levy is 69, and will now have more time to search for his successor. He earlier confirmed he would stay beyond the end of 2011, when he initially planned to retire. In the webcast, he indicated that he had told the board that he would stay "as long as you need me," which is presumably through a transition period after a successor has been named. Levy has indicated there would be multiple candidates -- chief operating officer Jean Yves Naouri is seen as one. Organic growth aside, Levy noted that the company made a number of acquisitions in the first half -- notably digital shop Rosetta and social media agency Big Fuel. He suggested that the aggressive pursuit of acquisitions would continue, "and they will be key elements for the growth of our networks." But going forward, Levy also stressed that talent would be a "priority ...particularly after two years of a salary and hiring freeze." Latin America was the fastest-growing region by revenue growth in the first half, albeit from a relatively low base. The region posted a nearly 25% gain to $223 million. North America, the biggest region by total dollars, had the smallest growth -- up 1.1% to nearly $1.84 billion. Europe was up 11% to nearly $1.3 billion, and the Asia-Pacific region was up 7% to $436 million. The company noted that organic revenue growth in the U.S. reached just over 7%, driven by "solid media growth and the sizable contribution of the health care sector." The company stressed it would continue to focus on its strategy of expanding in high-growth countries, with a particular emphasis on China and Brazil, while continuing to bulk up its digital resources. Digital now accounts for 29% of the company's total revenue, up from 28.1% in 2010, while traditional media accounts for 20% -- the same as last year. Creative advertising revenue accounted for 31% (down from 33% last year) and various diversified services accounted for the rest.
AT&T continues to boost distribution of its U-verse TV service, although expansion came at a slower pace in the April-June period than last year. The net customer gain of 202,000 was slightly below the 209,000 in 2010. Still, the number of U-verse TV customers now stands at 3.4 million. That pushes the AT&T service past Cablevision (using its numbers through June) in the ranks of multichannel video providers. The U-verse TV net additions of 202,000 in the most recent quarter was down from the 218,000 in the first quarter this year, but the recently completed period is "traditionally a seasonally soft quarter," according to Bernstein analyst Craig Moffett. AT&T said that in markets where U-verse has been available for three years-plus, it has a penetration rate of 25%. The company expects to complete the building of its U-verse footprint by the end of the year, which might lead to an increased focus on grabbing customers from competitors. On one level, U-verse is fulfilling a goal that AT&T had when it joined Verizon with a telco TV service: allowing it to sell larger packages. The company said more than 75% of its U-verse subs have a triple- or quad-play, with average revenue at $170, which is about 8% higher than a year ago. U-verse is available in markets such as Los Angeles, Dallas and Atlanta.
The newspaper business is still stuck in the doldrums, judging by the latest results from big publishers, including the New York Times Co. and Gannett Co., both of which recently revealed another round of revenue declines in the second quarter of 2011. However, the bad news at NYTCO was partially offset by the promising results of the new paywall erected around some of The New York Times' online content at the end of March. NYTCO's total revenues slipped 2.2% from $589.6 million in the second quarter of 2010 to $576.7 million in the second quarter of 2011, due mostly to a 4% decrease in overall advertising revenues from $314.9 million to $302.3 million. That, in turn, was attributed to a 6.4% drop in print ad revenues. The story wasn't all bad. While retail advertising dropped 8.9% to $60.6 million and classifieds fell 8.1% to $46.5 million, national advertising actually increased 1.8% to $159 million. In addition, total digital ad revenues rose 2.6% from $82.4 million to $84.6 million, including a 15.5% jump at the company's News Media Group, from $50.4 million to $58.2 million. Perhaps most significantly, the new paywall at the Web site of the company's flagship newspaper has produced significant revenues and is on track to take in $34 million by the end of the year, according to calculations by Outsell analyst Ken Doctor. Since its launch in late March of this year, the number of digital subscribers acquired through the paywall increased to 224,000; counting paid subscriptions for e-readers and replica editions, total paid digital subscribers came to 281,000 at the end of the second quarter. There are also 100,000 readers who get free unlimited access to the site through a sponsorship deal with Lincoln. A further 756,000 home-delivery subscribers also get unlimited access to digital content.
HD commercials now comprise almost 20% of all TV commercials -- about double the share they had a year ago. For the second quarter of 2011, a new study from Extreme Reach says the reason for the spike is lower distribution costs, more local TV adoption of HD commercials and a simpler execution of HD spots in overall campaigns. Extreme Research says these factors are important, considering a slower growth in HD advertising in 2010. Low-cost, cloud-based services have driven down costs for some business segments by 30%. The company says 94% of local TV stations that can take HD commercials use cloud-based services. Overall, 44% of local TV stations and 63% of cable operators can take HD commercials -- versus a 27% number for TV stations and 50% by cable operators. The boost has been pushed by different levels of advertisers. Where only major big brand advertisers had used HD commercials, now regional and smaller markers -- grocery stores and regional auto dealerships -- are incorporating HD messaging into their campaigns. Says John Roland, CEO of Extreme Reach: "Advertisers had been in a holding pattern for a while when it came to HD. The Q2 numbers reaffirm what we've heard from advertisers for a while: When key industry hurdles to adoption become less pronounced, you'll see more and more HD ads on TV."
Condé Nast, Adobe Partner for Digital Metrics With tablet computers and digital magazines soaring in popularity, magazine publishers and media tech firms are scrambling to figure out how to measure digital circulation -- a key question as advertisers explore the capabilities of the burgeoning digital space. To that end, this week Condé Nast and Adobe unveiled a joint effort to define and deliver a new set of audience metrics for publishers and advertisers. It is being touted as (potentially) a new standard offering insights into distribution of digital editions, levels of exposure within those editions and audience engagement. The digital metrics appear to cover most of the big question marks when it comes to digital magazine circulation. Components of the new digital metrics include, among others: "Total Digital Edition Circulation," which is calculated as "Single Copy Sales + Digital Subscribers + Authenticated Readers"; "Total Issue Readers," calculated as the total number of readers that have accessed the digital edition at least once; and "Total Ad Readers," calculated as the total number of digital edition readers that have looked at each ad at least once. Condé Nast said it will begin making the digital metrics available to advertising clients beginning this fall, with more magazines joining the group through the first half of 2012. Scott McDonald, senior vice president for research and insights at Condé Nast, said the partnership with Adobe had already turned up some interesting findings: "Our data suggests that reading behaviors with digital editions seem to more closely follow those associated with printed magazines. While this could evolve, it currently indicates that consumption is very different from the consumer's fragmented and short-duration reading on Web sites." Time Offers "All Access"Time is consolidating access to its various platforms with a new subscription covering print and digital properties. The $30-per-year "All Access" subscription option includes 56 print issues, complete online access, including a new Time.com magazine "channel," and digital issues via devices including the iPad, HP Touchpad and Samsung Galaxy Tab. Those who don't subscribe to the print or "All Access" edition will not be able to view articles from the print magazine online until three months after their original publication date. Time is also offering a $2.99 monthly subscription option. Marriott to Lead Source Interlink Biz Intelligence Source Interlink Media has appointed Senior Vice President John Marriott the head of a new division devoted to business intelligence. He will be responsible for leading research and analysis by a team of data miners and analysts to provide advertisers with consumer insights. Marriott will retain the responsibilities of his previous role as SVP and general manager of Motor Trend Auto Shows. The hoped-for consumer insights, based on interests and buying habits, include new and emerging consumption trends that advertisers can exploit through timely messaging. Trong to Fashion Editor, Nymag.com Stephanie Trong has been named the fashion editor at New York's Web site, where she will be responsible for overseeing all fashion, beauty and shopping content.
Ten years ago, 8% of the annual U.S. advertising spend was on radio. Today, that number has dropped to 5%. While this is a serious problem for radio, many companies are working to take what radio does best -- create highly engaged and loyal audiences -- and build on it to become a significant force in today's media landscape. By offering solutions that will enable radio to evolve from a push medium to a two-way dialogue and better understand its audiences, radio will be able to deliver advertisers more effective and measurable campaigns, closing the gap between what advertisers' want and what most media companies with a stake in radio can actually produce. Strength, Stability and Widespread Appeal It's undeniable that more people interact with radio than any other medium. According to RADAR, in 2010 nearly 220 million people ages 12+ tuned into radio at least once a week, up from 213 million in 2009. Today, radio reaches 93.1% of the U.S. population and these numbers are even greater in the urban, African-American and Hispanic markets. Get Consumers to Share More and Spend More What radio has that many other channels are struggling to obtain is trust. In a recent study conducted by RazorFish, it was revealed that trust was one of the single most important factors related to customer engagement with a brand message. An equally important engagement element identified in the study was value -- another trait that radio has accomplished with relative ease. In the study, trust and value ranked significantly higher than ad relevance, message consistency and control of how an ad is delivered. Thanks to data from a number of recent listener engagement campaigns, it has been proved what those in radio have long assumed: Radio listeners are much more likely to volunteer personal information to their most-listened-to stations than they are with other channels, namely the Internet and social media outlets For instance, listeners often text message their song requests into radio stations or complete online submission forms for contests or sweepstakes on their favorite station's Web site. Both of these examples illustrate the level to which listeners trust their stations and perceive value from interacting with them. What does this mean for advertisers and marketers? Advanced technology now allows radio stations to identify and numerate their most highly engaged audience members and interact with them through multiple channels: radio, mobile, interactive and more, ultimately getting consumers to share more and spend more. This presents an opportunity to offer a significant value proposition with hyper-targeting and measurement of return-on-advertising dollars. Multi-channel, cross-media engagement is essential as multiple touch points serve to build richer multidimensional consumer profiles that are critical to hyper-targeting. Empowering Radio To Become A Local Advertisers Dream Today, radio receives less than its fair share of advertising spend. In order for our industry to advance successfully, media industry providers need to work together to combine essential infrastructure and technology solutions to provide an integrated and open platform that advertisers, brand marketers and media buyers can use. Many in the radio industry decided that it was time to develop new solutions for the industry with the right engagement and accountability tools to ensure that radio professionals and advertisers can leverage the highly engaged local audiences and effectively compete for new and emerging advertising dollars. This is why Marketron has partnered with Emmis Interactive and is integrating the Marketron Mediascape Platform and Emmis Interactive Digitial Suite, which includes BaseStation (an advanced CMS) and GeoStation, user-level analytics platform There is no doubt that radio needs to advance into the 21st century and capitalize on the opportunity that is available through newer digital media channels; these partnerships are the first step. The collaboration helps media organizations tap into the technologies and services required to build profitable digital businesses, while enhancing more traditional advertising opportunities through superior accountability and audience interaction. Access, impact and measurement are essential for the future success of radio as an advertising channel. These kinds of partnerships provide the industry with proven solutions and choice, a good foundation to build on. Through these cooperative partnerships, the industry is making it easier for marketers to track their radio advertising and audience, regardless of the medium that is used: broadcast, mobile, online and everything in between. Coupled with radio's undeniable strengths -- trust, value and localization -- it makes for a very powerful marketing tool which will not be underestimated by advertisers that know the value of targeted, trackable campaigns.