With the exception of radio and out-of-home, U.S. legacy media ad prices continue pacing downward and are projected to be deflationary for the first time since the COVID-19-related ad recession. Linear TV, in particular, is seeing downward price pressure, according to the just-released third quarter edition of ECI Media Management's quarterly inflation updates.
That's even worse than the roughly 2% decline in linear TV advertising costs ECI was projecting for this year when it released its second quarter update, just as the Hollywood strikes were beginning to derail original scripted TV programming production.
And even though the Writers Guild of America has settled its strike, and the actors union (SAG-AFTRA) are expected to follow suit soon, the impact of the strikes is already baked into ECI's projections.
Coupled with the ongoing decline in linear TV viewership, which has fallen below 50% for the first time, ECI characterized TV ad pricing as "set to deteriorate further into deflationary territory."
"Sports content is expected to be an exception to the deflationary trend, with demand for and viewership of the NFL and NCAA likely to remain strong," the report notes.
While the long-term impact of the Hollywood strikes is projected to be most acute on U.S. ad prices, ECI projects it will also affect the global advertising marketplace, noting, "American content is of course consumed worldwide, so the effects are being felt globally."