From Buyers to Sellers: Chasing TV's Long Revenue Tail

By Nathan Skid | December 06, 2016 | 2:00

“We would be fools to say that ratings next year are going to go up and TV is going to make a big comeback,” says Mike Law, Dentsu Aegis’ exec VP and director of video investment. “We try to limit the hysteria.”

In fact, ratings at each of the Big Four networks, ABC, NBC, Fox and CBS are down. The NFL’s viewership is down. Even the once-mighty ESPN is losing subscribers to the tube of 2 million in 2016.

But, says Andy Kubutz, exec VP, program planning and scheduling at ABC Entertainment, TV still has the biggest reach. And advertisers are still willing to pay a higher ad rate to get access it.

“I think it's the most exciting time, and in some parts it's the scariest time for people in broadcasting,” Mr. Kubutz said at his office on the lot of ABC’s Burbank Studio. “But I think it's important to understand that we still have a giant reach that can't be matched any place else.”

But the loss in reach is not lost on the buyers.

“The concern, by advertisers and brands, is that if you're planning something and you've based your sales and you're trying to sell product and all of a sudden less people are watching TV and you've put a lot of money there, then you're concerned that, I'm not reaching the audience that I need to reach," Law said.

Digital ad spending in 2016 will reach $72.9 billion this year, topping traditional TV by about $1 billion, marketing the first time digital has out-earned TV in the United States, according to an eMarketer report.

Live TV still matters. A lot.

But buyers’ willingness to pay higher rates for TVs shrinking audience won’t last forever.