The turnaround is complete at Disney's (NYSE:DIS) ABC network. With sponsors lining up commercial time ahead of the fall season, Disney's ABC has penned $2.7 billion worth of primetime advertising commitments. That's a nearly 30% improvement from the $2.1 billion that the company generated during last year's upfront selling season.
This really isn't much of a surprise. Thanks to a strong rookie class that included monster hits like Desperate Housewives and Lost, ABC has a lot of people suddenly tuning in. With a 12% surge in viewers, and an even more impressive 16% spike in ratings coming from the coveted 18- to 49-year-old target audience, Disney had sponsors just where it wanted them.
It's not just the sheer number that has sponsors earmarking their budgets for ABC. On average, they will be paying 4% to 6% more for each set of eyeballs.
Disney's gains are likely to translate into losses for its competitors, especially for General Electric (NYSE:GE), since NBC sputtered in the ratings this past season. But even for the losers, there is a bright side: Sponsors aren't abandoning traditional media advertising.
Despite the growth spurts in ad-dependent online giants like Yahoo! (NASDAQ:YHOO) and Google (NASDAQ:GOOG), advertisers still feel a need to pay up for televised real estate. A company like aQuantive (NASDAQ:AQNT), which has more than doubled since I first wrote about it back in November as a piggyback play on Google, even specializes in migrating traditional advertisers to the online world. But although online advertising is doing great, there is still money to be made from the conventional-content broadcasters.
So for ABC, a network that was once both lost and desperate, the only thing meatier than the perpetual cliffhangers in its hot, young, hour-long shows are the ads that lie in between.
Some more prime-time headlines:
- It was apparent by last October that ABC had finally licked its woes.
- Two weeks ago, the major networks rolled out their new fall lineups.
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Longtime Fool contributor Rick Munarriz has been on TV before. Then his wife told him to get off the set. He owns shares of Disney. The Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.
