Viacom plans to reduce the number of ads it’s showing on its networks, a decision that’s most notably impacting the ad loads for BET and MTV.
During today’s earnings call, Viacom said that BET has the highest ad loads across the house. But now that ratings are turning for Viacom’s networks, the company said it wants to payback that ratings gain by improving customer experiences.
“Our ad loads in my opinion were unhealthily high,” said Viacom CEO Bob Bakish during the earnings call.
Last month, Barclays analyst Kannan Venkateshwar said Viacom’s key networks are improving viewership metrics.
“We note that turning around ratings in media companies in itself tends to take a long time but doing so in the midst of secular shifts and in a demographic that is moving the fastest away from TV, is even more challenging. There is likely to be a lag in the ratings improvement showing up in numbers. However, if sustained, these trends could help Viacom multiples recover some of the gap relative to peers,” wrote Venkateshwar in a research note.
As Viacom prepares to reduce ad loads, the company is also planning to beef up original programming. During the earnings call, Bakish said the company intends to increase original programming at MTV by 60% but the network will spend less.
Viacom’s comments about its networks arrive alongside a fiscal third-quarter that saw the company boost its revenues and grow its net earnings from continuing operations by 57% to $680 million, thanks largely to the sale of its stake in EPIX.
Of course, other networks have experimented with reducing ad loads and restricting ad breaks. Turner reduced ad loads on TNT and TruTV. And the NFL announced plans to remove some of its commercial breaks during next season.