Ad load is one of the hot subjects in the TV industry right now, and ESPN and ABC owner Disney might be set to make a bold move there. Disney CEO Bob Iger said on last week’s first quarter earnings call that ESPN and ABC will examine reducing the amount of ads they air, as Adam Levy writes at The Motley Fool:
Do you hate sitting through television commercials? Commercial breaks are just too long and come too often, right?
Good news: Disney CEO Bob Iger agrees.
“I think that in general, there is probably too much commercial interruption in television,” he told investors on the company’s first-quarter earnings call. Disney will specifically look at lowering ad load on ABC and ESPN.
As Nathan McAlone noted at Business Insider, Iger hasn’t promised any particular ad load cuts, but rather an evaluation of the ad load at those networks. That evaluation may not wind up producing any changes. However, it’s certainly noteworthy that Iger is saying he thinks there are too many commercials and that ESPN and ABC are going to take a look at their ad loads. As Levy mentions, reducing ad load has been done before, most notably by Turner’s TruTV, but also somewhat by Fox and Viacom. Making this kind of change might not be easy for ESPN, though.
For one thing, ESPN already has a major advantage in the advertising realm, as so many people are watching its programming live (and thus seeing the ads) rather than off their DVRs. They’re thus already commanding quite favorable rates. In order to maintain the same revenue with a lighter ad load, you have to boost the prices for each ad, and while that generally worked at TruTV (Levy’s piece says their bottom line has been about the same, and they’re seeing positive responses from advertisers), it may be a bit tougher to do at ESPN given that a lot of their rates are already high.
Moreover, reducing ad load on an ESPN live sports event may not be quite as desirable as doing so on a scripted show. At least part of the aim of doing so on a scripted show is to encourage more live watching, but that’s already happening with sports. Scripted material also has to compete with commercial-free alternatives that air on services like Netflix; there aren’t as many direct alternatives in competition with sports broadcasts.
There are some merits to the idea, though, especially if it might help ESPN retain subscribers and viewers. A big issue for ESPN has been the subscribers it’s been losing, and if less ads provide a more-viewer friendly experience, that might not only keep people watching ESPN, but keep them subscribing to the network. There could be benefits for ESPN’s non-live sports programming, too; maybe SportsCenter becomes more compelling viewing with a lower ad load, or maybe more people stick with ESPN’s various debate and analysis shows if there aren’t commercial breaks as frequently.
Dialing down ad load is something with clear pros (more engaged viewers, higher ad prices, ads that stand out more) and cons (you’re reducing your opportunities to sell ad slots, and gambling that can be made up with more viewers and/or higher slot prices; you also make it difficult to return to more ads in the future), and it’s a complicated situation, especially when it comes to a sports network like ESPN that’s very different from most of the TV landscape. It’s certainly interesting that Iger is examining this, though, and it shows that Disney’s exploring lots of options to improve ESPN’s standing (and not have to discuss the network’s issues during every earnings call). We’ll see where it goes from here.