by Mike Masnick

Filed Under:
csi, online ads, simpsons, tv ads

Online Ad Rates Higher On Certain TV Shows Than TV Ad Rates

from the go-simpsons dept

We were just being told by a supposedly respectable media analyst that things like Hulu were anti-American, because it gave away content for "free" and could potentially bring down the entire media business. Yet, it appears that media businesses are learning how to monetize that online content quite well. Bloomberg notes that for shows like The Simpsons and CSI, online ad rates are actually higher than TV ad rates. There are good reasons for this, including the fact that advertisers recognize viewers of shows online are more committed to the shows -- in that they actively chose to seek out and watch that show, as opposed to just having the TV on in the living room while doing something else. Also, people are more willing to watch those ads, in part because they're shorter and they don't have to watch as many to get to the content they want. Now, it is true that the number of viewers still represents a substantial difference and that media companies rely heavily on carriage fees from cable companies and the like. But the idea that ads can't support TV shows online doesn't seem to be based on anything in reality.

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  1. identicon
    some media producer guy, 29 Jun 2009 @ 11:32am


    agreed with the above comment. Although the rate of the commercial is higher for some shows on Hulu than on tv, the fundamental principal of Hulu is having a smaller number of ads. Thus, although ad space cost is more, the return to Hulu (and thus the return to media producers/production houses) is less because there are far less ads, meaning less overall advertising money collected.

    The reason why big name content producers like NBC, FOX get mad at things like Hulu is that when Hulu began they saw the website as a source of EXTRA ad money from the online streaming. However, with apps like Boxee and Hulu Desktop slowly threatening to replace conventional tv. Not only does that scare Cable companies whose business models are based on selling premium content (ie cable packages) it scare large name content producers because it could replace their original tv commerical ad return, with the online commercial return, which as I mentioned is much less.

    It will be interesting to see what happens in the long run. I think in the future shows may be given smaller budgets to compensate if they are going to lose large areas of ad space from online streaming. This might mean more reality shows and less big budget shows like Lost.

    I also predict more product placement in tv shows. The intergration of ads and content is the only way to ensure to advertisers that people are watching the ads. Don't be surprised when you favorite sitcom characters start asking for their spouse to grab them a can of coke from the fridge, or if sent in their checks for the AllState insurance bills.

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