Despite all the hoopla over interactive media, network television is here to stay and likely to see revenue growth of as much as 7% in 1994, one key broadcaster said Monday.
CBS senior veep David Poltrack told attendees at PaineWebber’s annual media conference that fourth-quarter growth of about 5% will result in year-end revenues ranging from flat to slightly lower.
That’s not bad, since 1992’s comparable gross included $ 800 million generated by the Olympics, he said.
“Achieving roughly the same revenue level in 1993 as in 1992 without the cost of the Olympics means that the networks had a good year,” Poltrack said.
On the basis of upfront market results, Poltrack predicted 1994 three-web revenue growth of 4% to 5%. He said, however, that increasing viewership, a strong scatter market and gains from the Winter Olympics could boost 1994 revs as much as 6% to 7%, “with more upside than downside to that forecast.”
Poltrack defended the broadcasters’ ability to hold share against its interactive competitors, saying early tests for video-on-demand have not produced substantial results.
A bit more
He estimated future interactive videogame usage of only a bit more than two hours per week in about half of all TV households, and pointed out that interactive versions of hit TV shows require hit TV shows — the webs’ strong suit.
“Interactive is as much an opportunity for us as it is a threat to the networks,” he said.
While the networks may be growing bullish, optimism is more tempered on the advertising front.
The Olympics, an economic upturn and political campaigning will spur U.S. ad spending by 6.3% to $ 146.8 billion in 1994 after an unexpectedly slow 5.2% rate this year, said McCann-Erickson senior veep Robert Coen, who had predicted 1993 growth of 6.9% last year at this time.
“Corporate profits are at all-time highs and many marketers will be turning their attention to expanding revenues rather than just controlling costs,” Coen said.
He estimated that overseas revenues will grow by 4.9% next year to $ 171 billion in 1994 and total global ad spending will rise by 5.5% to $ 317.8 billion.
A more sober opinion came from Zenith Media Worldwide topper John Perriss, who sees a 3.8% rise in U.S. ad spending in 1994, down 0.1% from this year.
Both execs expect China and the overall Asia/Pacific region, excluding Japan, to show “spectacular” advertising growth in the next few years.