CBS Corporation Chief Research Officer David Poltrack admits that he got it wrong a year ago. His forecast that 2010 revenue growth for the Big Four television networks would be 5% was off the mark. Of course, when he made that prediction to the annual UBS Global Media and Communications Conference it looked to be aggressive – instead it proved to be conservative.
Having predicted that 2010 growth would be 3% for the core business, with the Olympics adding another two points, Poltrack is getting more aggressive in his 2011 forecast. He’s now predicting 5% core growth, excluding the impact of the Olympics. That works out to total growth of 3.4% over the Olympics-inflated 2010 figure.
Since NBC Universal’s Olympics model shifted some ad dollars to its cable networks, the broadcast portion on NBC came in below Poltrack’s projection of adding two percentage points in 2010, so his final forecast for 2010 is that the year will end with the Big Four up 6.2%, or 4.6% excluding the Olympics. So, his bullish forecast is that core business for the networks will be up 5% in 2011 on top of 4.6% growth in 2010. At least that sounds pretty bullish today – just as his previous forecast did a year ago.
“The scatter market is definitely hot, however the networks’ ability to capitalize on that market demand will be affected by the audience delivery of their programming and the degree to which they can avoid accumulating a significant amount of audience deficiencies with their Upfront advertisers that have to be paid off,” Poltrack told the UBS gathering. Looking at the ratings season-to-date, including same day DVR playback data, he noted that two networks have posted gains over the same point a year ago: NBC and his own CBS. The “C3” results for CBS, upon which many makegoods are based, are even better for CBS, so Poltrack is a happy camper.