Wible's Weekly - "Marvel"ous Originals, New TV Ad Rates, and Big Data Oppty - Janney/MediaEntertainment

Original Arms Race amp8211 IPTV providers are becoming an increasingly important market for content producers According to Deadline Hollywood DIS39 Marvel is leveraging their success in films by developing 60 episodes across four drama series and a miniseries that may target VOD players including NFLX and AMZN Separately NFLX entered in a deal with Sony Picture Television to produce a psychological thriller We believe the escalating arms race for original content has the potential to harm the traditional TV ecosystem as it forces networks to invest in more costly programming including sports and as it has the potential to erode ratings We believe this dynamic is also behind the push for retrans and substantial increases in affiliate feesBroadcast Ad Rates amp8211 The cost of advertising on the new season of broadcast programing varies significantly according to an Adweek survey of media buyers New hit shows such as The Blacklist generate a healthy 199k per 30second spot ABC39s SHIELD and CBS39 The Crazy Ones attract 170k and 175k per spot respectively while less popular shows such as Ironside and Welcome to the Family attract only a third of that amount This compares to established hit shows such as Big Bang Theory on CBS that gets the highest ad rates 326k which actually pales in comparison to the 570k595k for NFL content on NBC and Fox Although pricing is mostly set in the upfront these ad rates are broadly consistent with the ratings trend we have observed in the first few weeks of the new broadcast seasonMobile Data Stats Half of all internet connections globally are now at 4Mbps or higher according to AKAM The study notes that several early adopter broadbandfiber countries are seeing averages drop due to the increase of mobile connections Interestingly AAPL39s Safari browser is responsible for the highest proportion of mobile requests across cellular and wifi with 54 despite a greater proportion of Android devices In addition to supporting the thought of higher usage by iOSSafari users the default cookie blocking on Safari means that marketing companies have to rely on alternatives In this context mobile FB app usage and signin can provide a significant advantage in obtaining and utilizing targeting dataCable Ad Spending amp8211 Cable advertising declined 18 in 2Q13 among the top 6 MSOs despite the 13 increase at CMCSA according to SNL Kagan Several others saw steep declines of between 4 and 16 while TWC experienced a relatively minor decrease of 19 The cable numbers paint a less than stellar picture of local advertising although this already includes declines from political advertising Excluding political CMCSA was up 5 and TWC actually increased 12 million Advertising ARPU was 537 across the top 6 and down 36 YoY Prospects for the back half of the year remain murky due to difficult political comparisons balancing good core trends and a strong finish from holiday spending We believe local TV advertising by small business is more prone to move to social media given the lack of a sophisticated ad planning process that slows the move for large brandsBig Data amp8211 The Direct Marketing Association is seeking to limit privacy initiatives by regulators by estimating that data driven marketing firms were responsible for 156 billion in revenues and employed more than 675000 The DMA hopes that these numbers will give regulators pause before seeking to implement new laws to restrict a significant portion of these revenues and jobs In addition to protecting jobs and revenues the DMA touts benefits such as innovation opportunities for small businesses and improved consumer choice from datadriven marketing We continue to believe any measure that restricts cookies and tracking could actually help FB other social networks and large publishers as they will still have a means to target ads while their competitors operate less effective platformsTony Wible joined Janney Montgomery Scott in 2008 and is a Managing Director covering the Media and Entertainment sector after spending the previous 10 years at Citigroup Investment Researchamp8212most recently covering the Broadcasting and Entertainment Services industries Tony can be reached at twiblejanneycom Janney Montgomery Scott LLC is a US brokerdealer registered with the US Securities and Exchange Commission and a member of the New York Stock Exchange the Financial Industry Regulatory Authority and the Securities Investor Protection Corp Disclosures may be reviewed at Wible39s WeeklyRead all Tony39s MediaBizBloggers commentaries at Wible39s Weekly JanneyMediaEntertainment Check us out on Facebook at MediaBizBloggerscomFollow our Twitter updates MediaBizBloggerThe opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaBizBloggerscom management or associated bloggers MediaBizBloggers is an open thought leadership platform and readers may share their comments and opinions 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