- TV broadcasters to see significant ad-revenue loss from Covis-19
- Audience spikes and higher viewing numbers will not alter bottom lines
- GlobalData analyst: “Brands are reluctant to burn their limited cash reserves on ads”
While all technology, media and entertainment sectors will be negatively impacted by coronavirus, TV broadcasting will be hit the hardest from a loss of ad-revenues.
Covid-19 has been having a devastating impact on the TV broadcasting industry as firms have been reluctant to spend on advertising, according to new research from GlobalData, a leading data and analytics company.
TV broadcasters are reporting significant spikes in viewers tuning in to news bulletins and entertainment programming throughout the week with households under lockdown. However, despite broadcasters experiencing higher viewing numbers their bottom lines will be “significantly hurt by falling ad revenues” GlobalData said.
GlobalData thematic analyst Danyaal Rashid said: “Covid-19 has led to significant cuts in TV ad spending, affecting those broadcasters that rely on ad revenue to survive.
“Brands are reluctant to burn their limited cash reserves on ads, especially since this won’t stimulate demand in an economy shut down by non-market forces.”
In GlobalData’s Thematic Rankings for the music, film and TV sector, TV broadcasters have fallen several positions due to their exposure to Covid-19.
Comcast has fallen four places, from eleventh to fifteenth, while India’s Zee TV has fallen seven places, from ninth to sixteenth.
Rashid added: “While TV broadcasters are struggling, streaming services have been doing very well. This could be a turning point in the TV industry, with a significant pivot towards streaming.
“The revenue of subscription-based streaming platforms such as Netflix will remain unaffected by cuts in TV ad spending.”
Earlier this month the BBC Global News, CNN International and Euronews pledged $50 million in ad-revenue to promote public health messaging amid the coronavirus pandemic, aiming to reach 800 million people across the globe.
The broadcasters announced the combined inventory would be otherwise worth up to $50 million in advertising revenue and it will be available to major multilateral organisations and national health bodies to communicate information to help protect citizens and stop the spread of the virus.