Cable ad revenues boom

Cable network advertising revenue is booming, according to Kagan Research’s annual survey of network executives. Revenue at most major cable networks has been rapidly growing and is expected to reach $33.8 billion – a 13.1% growth rate – by 2006. Total revenue was up 12.7% to $29.9 billion in 2005, only slightly less than the growth rate of 13.6% reported in 2004. The projected increase in growth for 2006 would indicate a rebound from the current slowing of affiliate revenue and growth in CPMs rather than annual license fees.

In terms of total revenue, at $3.7 billion in 2005, ESPN took in $2.1 billion more than its nearest competitor. Nickelodeon, TNT, FSN, MTV and USA all surpassed $1 billion in revenue, and ten other networks achieved revenue greater than $500 million, according to Derek Baine, senior vice president of Kagan Research.

Based on discussions with top executives from nearly every major cable network, Kagan’s outlook, data from which is in the current edition of Benchmarking Cable Network Financial Statistics, includes that programmer’s experienced success will continue and ad revenue will remain in double-digit growth territory for the foreseeable future.