2014 Forecast: TV Ad Revs To Top $4 Billion

MediaPost News

by David Goetzl, Thursday, October 15, 2009, 5:00 AM

Comcast COO Steve Burke has hyped the potential for massive growth from advanced advertising platforms being developed by Canoe Ventures. A new report seems to buttress his confidence, projecting industry-wide revenues in the emerging field will top $4 billion in 2014.

Advanced advertising is somewhat of a catch-all term encompassing addressable opportunities as well as interactive. Cable operators have deployed some or both at local levels, while Canoe — a consortium of the six largest cable distributors, including Comcast — promises to activate them on a national level.

Satellite operators have offered interactive options, though in fewer homes than Canoe could potentially reach.

Research firm Parks Associates predicts U.S. revenues from advanced advertising will be more than $130 million next year, then grow exponentially through 2014.

Cable operators such as Comcast may be facing a soft ceiling on revenues from traditional cable subscriptions and are searching for new revenue streams. (The possible NBC Universal acquisition would be a dynamic example.)

Parks Associates forecasts the $4 billion for advanced advertising dollars in 2014 will account for about 12% of all ad revenue from cable, DBS and telco TV providers.

That $4 billion figure in 2014 would also be 73% higher than the 2013 projection.

Heather Way, research analyst at Parks, states: “In the short term, digital TV operators continue to ramp up their investment in advanced advertising solutions as a preemptive move to sustain ad revenues. In the long term, the investment serves to grow the advertising business segment.”

Canoe plans on offering an iTV option for lead generation, where a viewer can opt-in to receive a special promotion or coupon from a marketer, simply by using a remote control. Also under the advanced advertising umbrella as growth drivers, Parks Associates said, are long-form VOD ads; marketing messages delivered via DVRs; and banners on interactive program guides.