SMI: Ten’s revenue share gets Sochi boost but buyers expect fall in March

TenSome of Australia’s most senior media buyers have said the boost in revenue for the Ten Network shown in the latest Standard Media Index (SMI) numbers has been driven largely driven by the Sochi Olympics and the finals of the Big Bash and will likely fall back to normal next month.

The February SMI data shows Ten had a 24.2 per cent revenue share, up from 20.3 per cent last month, while Seven had a 40.4 per cent share and Nine had a 35.4 per cent share of the free-TV market.  The overall TV revenue in February was up 5.1 per cent year on year to $186.8m, while the overall category including pay-TV was up 4 per cent to $256.9m.

Ian Perrin CEO of ZenithOptimedia said Ten had been boosted by the sporting event and associated sponsorships, but a falloff in ratings in February and into March will see the network likely lose the recent gain next month. He added: “They were buoyed by the fact that their  programming in terms of the Olympics and Big Bash (final) happened in February. That’s something they didn’t have a year ago.

“Overall the TV market has been buoyant so I would imagine the overall TV market will remain strong in March, but Ten will get a lesser share in March than it did in February.”

A spokesman for Ten said network would not be drawn on its  revenue share targets and would not comment on speculation about their revenue share. However, earlier in the day, Network Ten chief sales officer Louise Barrett said in a statement the February figures were a sign that Ten’s strategy around event television was working.

However, Perrin’s view was also shared by Toby Hack, managing director of PHD. “There used to be time lag on how money follows programming but now its much quicker,” said Hack.

“It will be very hard for Ten to maintain the SMI figure they got in February. There is an awful lot of competition from Seven and Nine who have big programming formats that are absolutely on fire. So it’s difficult for them.”

“The revenue share we achieved in February was a solid result and proves our Event TV strategy is working. It is early days in our turnaround strategy, but we have a plan and we are executing it, as demonstrated by successful properties such as the XXII Olympic Winter Games and the KFC T20 Big Bash League,” said Barrett.

“Both of those sporting events boosted our revenue in February and the ratings for the Australian Grand Prix yesterday show it was a hit with viewers. Network Ten will bring viewers and advertisers more sporting events this year, including the Glasgow Commonwealth Games, Rugby Union and the start of the 2014-15 Big Bash competition.”

However another senior media buyer, who declined to be named, expressed concern about whether outside of these sporting events the network had the programming to compete with its rivals.

“The reason Ten is up for January and February is that they had Big Bash and Sochi but of course it will come off because they don’t have the headline programming of Seven and Nine like My Kitchen Rules and The Block,” said the agency boss. One of Ten’s key franchises Secrets and Lies last night drew an audience of just 317,000 viewers as its competitors Love Child on Nine and Revenge on Seven getting 1.065m and 768,000 respectively.

Another senior media agency figure told Mumbrella: “Ten will keep on trying to do whatever they can. However, while there is a level of predicting about how shows are going to go (at the start of the year) what happens is that there is a laggard effect into March but come April that’s when it becomes difficult because people start using the four week average. ”

Alex Pekish, group media investment director at Aegis Media said that while ratings go up and down there were opportunities for Ten to improve their revenue share through integration, pointing to their experiences with shows like Recipes to Riches and The Bachelor, adding: “While their shows might not have rated as well as predicted they will use their experience in shows like these to come up with integrated packages that will help advertisers promote their product and services.”

Hack agreed and noted all the big commercial networks have had ups and downs. “History tells us that its all about programming. We’ve seen all the networks on top and then go through difficult times, but the right programming strategy with the right programs will find audiences, and advertising revenue will follow those audiences,” said Hack.

A spokesman for Ten said they would not be drawn on the ratings trend but that the network was “cost efficient” for media buyers wanting mass audience, adding: “Ratings trends are part of the decision making process for media buyers. But there are other factors taken into account: for example, Network Ten continues to represent a cost-efficient way to build audience reach.

“Ratings, of course, go up and down. We are focused on our year-on-year performance, not four-week periods. More importantly, we are very excited about our post-Easter content line-up – which includes MasterChef Australia, Offspring, Under The Dome, 24: Live Another Day, The Millers, the Modern Family Australian episode and other great shows – and we are confident it will perform well.”

In other categories, the SMI data shows newspapers and magazines again posted double digit declines with print down 22.4 per cent ($56m) and magazines 15.2 per cent ($19.4m), while radio fell 3.5 per cent ($39.6m).

ZenithOptimedia boss Perrin said he was surprised by the radio revenue result and said he thought KiisFM’s recent ratings performance would lead to a boost for the category, particularly for the Australian Radio Network (ARN).

“I thought it was interesting that radio was down and you would have thought with all the changes marketers would have seen that as an opportunity to invest in the category, but I think everyone took a wait and see approach”, said Perrin.

“What will be interesting in the next little while will be how radio performs, subject to the performance of KiisFM and ARN in general.”

Nic Christensen 


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