Major TV Networks Profit From OTT Marketplace Advantage

With all the new OTT startups from traditional TV networks, there is one area that doesn’t feel panic: TV news networks.

TV news networks have been the rare growth area — especially media companies' main cable news networks: CNN, Fox News Channel and MSNBC.

Andrew Lack, chairman of NBC News and MSNBC, says MSNBC will enter the race with a new OTT app, which will deliver much more video content than its predecessors.

Fox News has already announced direct-to-streaming digital plans with Fox Nation. CBS has its news service, CBSN, up and running. CNN has its CNNgo service, which streams its TV feeds.

TV news programming has seen big advertising revenue gains since the November 2016 presidential election. Advertisers have increased spending on TV news programs/networks 8.7% to $4.07 billion in 2017, according to Standard Media Index.

In addition, viewership is higher -- one of the few areas of growth for any traditional TV genre. In prime time, Fox News Channel boasts the top overall viewership, with MSNBC rocketing into second place. Although it does not rank as high, CNN viewership has also gained.

So it makes sense that higher "demand" from viewership warrants a brand expansion. In addition, one imagines that TV advertising demand is growing as well.

Timing is everything. Big political advertising dollars aren’t slowing down. And while nearly $5 billion in political TV advertising -- in major political years -- goes to more local TV stations, national TV networks' OTT apps will increasingly get their fair share.

These OTT moves by major TV network news organizations may be a perfect hedge against the long term — when and if the supercharged political scene in Washington, D.C. and elsewhere calms down, perhaps returning to duller news stories.

At a recent rally, President Trump pondered what TV networks would do without him in the Oval Office -- that ratings would drop, ad money would decline, and things would get more boring.

Meantime, a free capitalistic marketplace looks to fill a need for marketers and consumers alike. No news panic here -- just high interest in political/governmental drama.

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