NBC Head Zucker: Advertisers 'Scared'
NBC Universal (NBCU) chief executive Jeff Zucker sat for an interview earlier today on CNBC, which NBCU owns, to talk about the dismal 2009 advertising picture.
In addition to NBC and CNBC, NBCU owns the Sci-Fi channel, USA, Bravo and Oxygen, among other channels. Cable channels -- such as Sci-Fi and USA -- have two revenue streams: advertising and subscription.
But broadcast networks, such as NBC, exist on advertising only. And in a recession, advertising is one of the first cuts made by struggling businesses.
"People are scared," Zucker said. "Money is still coming in, but it's coming in at the last second."
A real problem for companies like NBCU (and, to be fair, The Washington Post and other newspapers): Companies like NBCU don't make as much from selling online ads as they do from selling ads on television shows. Same thing in newspapers: Pennies on the dollar, when comparing the revenue of online ads to newspaper ads.
But consumers are increasingly moving away from broadcast TV and newspapers and onto online video and news. So companies like NBCU have to chase them but, so far, the payoff is not there.
Some time ago, Zucker (probably) coined the term: "Giving up analog dollars for digital dimes."
Today, he said digital ad growth in the coming year "will not be at the same levels that people have expected." (NBCU is owned by GE.)
Earlier today, also on CNBC, the head of the world's largest advertising and marketing company -- WPP -- said that in 2009, digital or online ad growth will actually be greater than 100 percent because off-line advertising will have a negative growth next year.
December 8, 2008; 1:34 PM ET
Categories: The Ticker | Tags: NBC, Zucker, advertising, recession, television
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