The annual gem that is March Madness--which estimates say costs U.S. businesses some $1.8 billion in lost productivity--has, for CBS, turned into a profit center on the air and online. The broadcaster earlier this week said it had sold out its entire March Madness on Demand ad space inventory, bringing in some $37 million and selling as many ads for its streaming online live coverage of basketball games as it did for its broadcast NCAA March Madness coverage, a first for the network.
CBS said revenues for its online video presentation were up 20 percent from a year ago. The NCAA tournament begins tonight with the play-in game featuring #16 Winthrop against #16 Arkansas-Pine Bluff at 7:30 p.m. ET (that game's on ESPN); the winner faces Duke in first-round play Friday at 7:25 p.m. ET. March Madness on Demand will stream every game of the tournament live starting Thursday.
Revenues for March Madness on Demand, according to AdAge, have risen from $4 million in 2006, the first year it was online as a free service to $32 million last year and $37 million this year. MMOD began in 2003 as a Pay TV service and was fee-based through 2005. The New York Times said the fee-based model peaked at 20,000 subscribers in 2005. A year later, when MMOD went to its ad-supported model, the number of viewers surged to 1.3 million. Last year 7.5 million users watched MMOD.
"What's unique about the experience is it hits the sweet spot of where online growth is," Jason Kint, SVP of CBSSports.com, told the Times. "It's video, it's live, it's D.V.R.-proof, and it's high-quality. There isn't much quality video out there. This isn't user-generated video. It's premium."
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