Great Upside for Comcast and Other MSOs with Direct Ads

Implications: 1.      Comcast is looking forward to having the ability to offer direct advertising much more definitively than in the past. 2.      Especially given the declining impact of advertising on pay TV in general, targeted ads directly to the individual sub will provide tremendous potential value.   3.      In some cases, an order of magnitude more in terms of cost could be demanded by the MSOs.

Analysis:  If one looks at the relatively small cable TV share of advertising sales, there is a big opportunity to take over substantially more of the overall pie.  There would be more of a guarantee that the eyeballs saw it – and they were the right eyeballs.  So, that will certainly offer an opportunity for substantial increases in revenue for the MSOs.  Hopefully for Comcast, a lot of the spending that has shifted to the Internet will come back.  

The large cable TV companies are looking to aggregate advertising coverage.  It would allow for national buys through one place across a suite of MSOs.  Now they can start really competing with the broadcasters for that huge advertising pie.  Of course, the broadcasters are coming back and saying they need to pay them for retransmission to keep a particular channel on their system.