The impact of DVRs, video on demand and interactive TV will have a much greater effect on the linear TV business than anyone previously thought. Accenture predicts TV ad revenue growth of only 3% by 2009, compared to other industry analysts predicting 6% to 10% growth by 2009. "A difference of potentially $27 billion in TV ad growth," reads its report, released last week. Accenture totals TV ad revenue in 2004 at about $60 billion.
Changes in viewing behavior will exert downward pressure on CPMs (or costs-per-thousand viewers, the metric by which agencies buy TV audiences). At the same time advertisers will have a tougher time reaching a mass audience, though more and more marketers, such as McDonald's Corp., have multiple messages aimed at multiple niches.
"Advertisers are demanding greater accountability, therefore greater measurement, On-demand will be able to provide that," according to the report. "This will create considerable challenges for the growth of linear TV advertising." Read more: AdAge.com QwikFIND aaq48r