TV Ads Land The Networks Billions for 2012-2013 TV Season

by on June 3, 2012

in Entertainment

TV advertiser fees for basic networksIf you have ever wondered exactly how the television networks manage to pay those crazy TV actor wages where they’re snagging up to $900K per episode? Well, the trick is through fees that advertisers pay. Yes, those pesky, overly loud ads that annoy the living s**! out of you are what foot the bills to make TV possible.

The ads you see on TV during your favorite TV shows are there because those advertisers have paid a fee to have their ads placed in those time slots. Different days/times/shows draw different rates/fees. Midnight repeats don’t reap as much money as prime time airings of NCIS! And if you’re observant enough, you can figure out who the primary TV viewer are by the ads that air. During some shows, you’ll see a lot of automobile ads. Then there’s NASCAR that seems to be heavily populated with Cialis ads.

TV advertiser fees for cable networksSo how much do advertisers end up spending on TV ads per season? Tooling around, I found some numbers and how much advertisers have spent with some of the networks, and as always, I’m astounded how much money is dropped on advertising.

TV ads are something we all grumble about, because they’re too loud. But it seems those who grumble are in the minority because for most, they must work or they wouldn’t continue to be able to fund our favorite TV shows.

And for the upcoming 2012-2013 TV season, advertisers have invested almost $19B (that’s billion) for the upcoming TV season.

Estimates put the income for broadcast networks at just under $9.5B and $9.9B for cable networks.

Below, a few estimates say who will make what:

  • CBS: $2.92 billion,
  • ABC: $2.65 b,
  • Fox: $2.15 b,
  • NBC: $1.78 b.

Keep in mind that the advertising industry isn’t tied to just TV, because there looks to be about $60B in monies to be had out there, TV is just getting some of it.

But in their efforts to spruce up the spending environment, the upfronts, the time when networks pitch their wares and sell the time, can easily drop a cool million on the event itself, rivaling the fanfare and enthusiasm that Comic-Con can create.

It’s also been noted within the industry that despite the fanfare created by the networks, the upfronts have to evolve. With the ever growing digital realm that is looking to circumvent TV, the networks have to impress.

And basic “broadcast” networks are now also looking at how cable networks are starting to land mega-hit TV series. When you get shows like Breaking Bad, Mad Men, The Walking Dead, Hatfields & McCoys, and sadly, I do need to include noise like wrestling, the basic nets are finding themselves forced to compete on even different grounds.

Now that cable is spending on quality entertainment, the broadcast nets have to figure out how to compete.

And through it all, as shows become more entertaining, the general TV viewer will be winning out as they get rewarded with better shows. And in turn, as they tune in and also speak with their brainwashed wallets when they’re out spending, they’re rewarding the networks for rewarding them. (It’s a vicious cycle, but someone has to feed it.)

I can’t help but wonder…

With TV landing almost $20B of an available $60B pot of ad dollars out there, I feel sad for our local schools, as teachers get laid off because their paltry salaries are “too much” to absorb.

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hollywoodreporter

nytimes

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