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For the First Time, Hit Shows Command Higher Ad Rates Online

For the first time, TV shows like "The Simpsons" and "CSI" are commanding higher advertising rates at sites like Hulu.com and TV.com than they are on prime-time TV, Bloomberg reports. Marketers are willing to pay more at these sites because their audiences represent committed users who are actively seeking out shows. Also, because there are fewer commercials, consumers are twice as likely to recall Web ads, says David Poltrack, CBS's chief research officer.

"The reason people are paying such a high premium for these ads on the Internet is they do have a captive audience," Poltrack says. "You know you have eyes on the screen." However, the challenge for the networks remains that while Web viewing and ad sales are increasing, revenues are still too small to replace traditional sources. For example, even CBS's successful Web cast of the NCAA basketball tournament drew 7.52 million unique visitors, compared to 17.6 million viewers for its television broadcast.

Marketers typically pay between $20 and $40 per thousand viewers for a prime-time ad. By comparison, an ad on Hulu.com for "The Simpsons" costs $60 per thousand viewers. Despite the higher rates, major advertisers like Intel are shifting their spending. "Hulu has all the comedies on NBC, Fox and now ABC," said Arlene Villanueva, Intel's global media director. "Most of those fans will watch the finale again or catch up on episodes they missed. It's a great opportunity to be smart and reach our audience.

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