As traditional advertising revenues continue to rise atTime Warner Inc.'sTurner, the company also is readying new ways of buying and selling ads.
Speaking during a May 4 earnings conference call, Time Warner CFO Howard Averillsaid that advertising revenues at Turner were up 5% year over year during thefirst quarter, thanks to double-digit growth across Turner's linear and digitalproperties for both news and sports. Looking ahead to the second quarter, hesaid scatter pricing at the domestic entertainment networks continues to be upin the double digits versus the upfront and will benefit from the NCAA DivisionI Men's Basketball Championship. "As a result, we expect total advertisingrevenue growth to be in the mid to high single digits" for the secondquarter, he said.
Between the healthy ad market and the continued roll out ofthe company's advanced advertising products, Averill said he expects that thisyear's upfront will be "very strong."
Asked to elaborate on the rollout of advanced advertisingproducts, Turner CEO John Martin noted, "Frankly, we are holding ourselvesaccountable to lead the charge to modernize TV advertising by combining theunparalleled reach of television and the engagement of TV with the measurementand targeting capabilities in digital."
He pointed to various new advanced advertising products atthe company, such as Targeting Now, Audience Now, ROI Now and Provable ROI.Together, these offer "targeted, audience-based selling coupled with ourdata cloud and client insights," he said. The executive added that thecompany plans to focus on the value these offerings bring during upfrontnegotiations.
"What we are trying to do [is] combine the best of bothTV and digital … and that's one of the reasons we are very bullish about theupfront," Martin said.
The company is also interested in developing moreadvertising opportunities in the over-the-top space. "I think theopportunities to develop advanced targeting capabilities at OTT are absolutelythere," he said, though he noted that offerings must be designed to be adsupported. FilmStruck, the upcoming subscription video on-demand service fromTCM (US) incollaboration with the Criterion Collection, will not be ad supported.
"So I think the targeting opportunities will only growover time, and we are still … in the very early stages," he said. "Webelieve that TV advertising has to evolve, but it's going to remain the mosteffective option for brand advertisers to convey their message at scale, andthat is why we expect the resurgence in TV advertising beginning at this year'supfront."
At the same time, the company is moving forward with itsplan to reduce advertising loads on truTV (US) starting in the fourth quarter of the year.Time Warner has saidtruTV will cut its ad load in half for prime-time original shows in an effortto drive consumer engagement and interest.
Martin emphasized that he does not expect this move to hurtTurner's ad revenues overall, as he expects to provide increased value perinventory unit. "We are not doing it to lose money," he said. "Weare actively going to be moving beyond the 30-second spot business to createinnovative new ad products for our advertisers and marketers."
All of this is in line with the company's larger goal toevolve and improve how ads are sold, watched and measured, he said. "We'regoing to learn a lot … and one of the reasons why we are starting with thiscommitment on truTV is obviously it's a network where we have less advertisingexposure than some of our larger networks TBS and TNT."
That being said, the company already has similar plans inthe works for "some of our other networks," he said.