More ads hit online TV

2011-06-09 14:05
Los Angeles - One of the rewards of watching TV online is not having to sit through as many commercials. Now the networks are chipping away at that little luxury.

CBS shows twice as many ads per show on its website as it did last year. The CW network shows four times as many. Dozens of shows from major cable networks now carry as many ads online as they do on TV. More shows will follow soon.

The online audience is still small compared with television, but it's growing. Networks hope that by showing more ads, they can make about as much money per viewer online as they do on the tube.

It's a change from the early days of online video. When ABC started putting full episodes of its shows online in 2006, fans could zip through the hour-long dramas Lost and Desperate Housewives in about 45 minutes. One short ad played a few times per show.

Limiting commercials kept people from going to unauthorised websites to watch pirated copies of shows. It also helped networks reach new audiences in college dorms and teenage bedrooms.

Opportunity

Now, as online audiences grow, networks see an opportunity to make more money. A recent episode of Hawaii Five-O carried six and a half minutes of ads online. That's less than the 16 minutes on TV but double what an hour-long show carried on CBS.com a year ago.

Online video has improved in recent years with faster internet connections and better technology. The advances have led some people to give up on regular TV - and hefty cable bills that come with it - and watch only online.

The websites of ABC and NBC and some cable channels offer a range of recent episodes online, as does Hulu, a site owned by the parent companies of ABC, NBC and Fox.

Other networks offer live sports online. ESPN puts events on ESPN3.com for viewers who get internet service through certain providers. And NBC put hundreds of hours of live competition online during the 2008 and 2010 Olympics. NBC agreed on Tuesday to pay $4.4bn for the rights to televise the Olympics through 2020.

Watching your shows on a computer, of course, means being forced to watch the ads. On the tube, digital video recorders allow you to fast-forward through them. For many people, the convenience of watching whenever, wherever makes going online worth it.

Kate Hooper, a 24-year-old nanny from Los Angeles, often travels for work. On a recent trip to Hawaii, booting up her laptop was the only way to catch her favourite CW show, Gossip Girl.

"I usually just put up with it and I'll take a break or go get food or something while the commercials are playing," Hooper said.

Viewership

CBS now shows about two or three ads per break online, up from one a year ago. CBS can charge higher rates than TV partly because online ads can do more - allow viewers to click to a website for more information, for instance.

"We've got a model today where we're comfortable whether that viewership happens on the web or TV," said Zander Lurie, CBS' senior vice president of strategic development. The company doesn't give a breakdown of how much revenue it makes from each format.

The CW, a broadcast network owned by CBS and Time Warner, now shows four commercials in a typical break instead of one - as many as there are on regular TV.

For both networks, viewership online grew anyway, a sign that viewers don't seem to mind.

The CBS and CW examples show that for big-budget TV productions, at least, it's possible to make enough money from the internet to pay for shows if audiences suddenly shift entirely online. Newspapers and music companies have struggled with similar dilemmas as their audiences have moved online.

Networks still make far more money from TV than from the internet, largely because online audiences are still comparatively small. Networks also get a piece of the monthly bills that viewers pay to satellite or cable companies for TV subscriptions.

Americans on average spent about 160 hours a month in front of the tube in early 2010 and only seven watching video on a computer or phone, according to the latest data available from Nielsen Co.

Money

But online video is growing fast. According to online ad firm FreeWheel Media Inc, people watched nine billion online videos from clients such as Fox, CBS and Turner in the last three months of 2010, an increase of about 50% from the previous quarter.

ZenithOptimedia expects online video ad revenue in the US to grow 22% this year to $3.3bn, compared with just 5% growth for all TV ads to $59.4bn.

For the networks, there's a side benefit to the growth of online ads. If internet viewers watch shows with exactly the same ads as their TV counterparts, they will be counted in Nielsen's regular TV audience ratings.

That means that when networks approach advertisers every spring to sell commercial time for their upcoming line-ups, they can add online audiences to their total count and bring in more money.

Until April, the online audience didn't count at all in the advance sales season.

"It's recapturing those eyeballs," said Jeremy Legg, a senior vice president at Time Warner's Turner Broadcasting System. "From a monetisation standpoint, it's the most effective for us."
- AP
Read more on:    internet
NEXT ON NEWS24X
SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/Sport
 

BMW drift battle: M235i vs. speedway bike

Watch this insane drift contest with four-times dirt-track World champion Karl Maier riding a speedway bike against a BMW M235i.

 
 

Men24.com

Want to start talking dirty?
Everyday struggles of naturally skinny guys
And this year's Miss Bumbum title goes to...
How to maintain your mo, bro

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Magical Massinga

Spend 5 nights at the gorgeous Massinga Beach Lodge in Mozambique and only pay for 4 from R13 220 per person sharing. Includes return flights, accommodation, transfers and romantic turndown. Book now!

Kalahari.com - shop online today

20% off ALL TV Series

Choose from 1000’s of the hottest TV Series . While stocks last. Shop now!

Festive gifts!

Check out our awesome range of festive gifts to make everyone’s wishes come true. Shop now!

Seen something you like in our catalogue?

Find the perfect gift and save up to R5000 – As seen on the catalogue. Hurry and shop now!

Save up to R2200 on electronics! – As seen in the catalogue

Wishing for tech gadgets this festive? Save up to R2100 on hot tech products at kalahari.com. While stocks last. Shop now!

Up to 35% off books

Save up to 35% on the latest page-turners. While stocks last. Shop now!

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Horoscopes
Aquarius
Aquarius

There is a strong focus on social interaction and connecting with your friends. You may have the need to expand and connect with a...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.