Foxtel Channels Playstation Ads

[Forest Lake]

Foxtel channels PlayStation ads

Lara Sinclair

MARCH 15, 2007

SONY Computer Entertainment will rack up two advertising firsts on March 23 when it launches a pay-television channel dedicated to showcasing its PlayStation3 games console.

The PlayStation 3 channel will be available for six weeks in the recently launched On Demand suite of programs on Foxtel's IQ digital set-top box and will feature six short films promoting the console that may be watched by viewers whenever they choose during that period.

Billed as the first TV channel to be dedicated to a single advertiser and a single product, it also represents the debut of on-demand advertising on Foxtel, the newest beachhead in the pay-TV industry's latest assault on free-to-air TV's $3.5 billion revenue pool.

Six advertisers are in talks about launching commercial on-demand content, a niche product that is likely to be dominated by longer-form sponsored or branded programming, according to Anthony Fitzgerald, chief executive of Foxtel's sales arm, Multi Channel Network.

This week Fitzgerald lobbed a bunch of grenades at his free-to-air competitors, announcing two other digital advertising initiatives, promoting pay TV as "the fourth network", proclaiming it the ratings leader in Sydney and arguing that, even as he chases more free-to-air revenue, his rivals need him.

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"This is about doing multi-million-dollar deals with our partners offering a suite of advertising or communications opportunities," Fitzgerald says.

"MCN is seen as effectively the fourth network (and) a key driver of growth in the market.

"Free-to-airs' great strength remains their ability to reach mass audiences. Our great strength is that we aggregate a mass audience that dramatically improves the performance of a free-to-air buy."

Every network cuts the ratings figures in the way that best suits them. MCN adds the audience of every pay-TV channel to get a total figure and measures viewing from 6am until midnight rather than using the 6pm to 10.30pm peak night measure applied by media buyers to individual free-to-air networks.

On its own terms, for the 10 weeks from January 1, pay TV's combined all-people audience of 21.1 per cent across all households was just behind Seven's 22.4 per cent share and Nine's 22.1 per cent, and far exceeded Ten's 16.5per cent.

In Sydney, where audiences have turned away from free-to-air TV at a greater rate than in other markets, Fitzgerald argues pay TV is the ratings leader, with 25.1 per cent of viewing compared with Nine's cricket-fuelled 21.2 per cent, Seven's 20.7 per cent and Ten's 14.5 per cent.

In homes with pay TV, its share of viewing since the free-to-air networks launched their ratings-season blockbusters four weeks ago was 59.4 per cent, up from 56.1 per cent last year.

"That is significantly greater than any other country in the world," Fitzgerald says.

Media analyst and pay-TV sceptic Steve Allen says the claims are spurious and points out that during peak nights the total pay-TV audience for the year is 15.73per cent in all homes. "If they want to add commercially available and non-commercially available channels together, then free-to-air should," Allen says. "Even so, they've got 84 per cent (of viewing) against them."

Mediaedge:cia general manager Adrian Smith says more advertisers, including traditionally conservative packaged goods brands, are using the medium in greater numbers.

"You could count six to eight stations that deliver the bulk of (that audience) and buy them on a cost per thousand basis that is (comparable to) free-to-air TV, and you've got yourself a schedule," Smith says.

Total TV revenue share figures bear that out.

After more than a decade, pay TV's share of all TV advertising still lags well behind its peak night audience share. It captured about 4.7 per cent of all TV dollars in 2005, based on Commercial Economic Advisory Service of Australia numbers.

Last year's figures have not been released, but Fitzgerald estimates pay TV's revenues increased 32 per cent in the six months to December to about $113 million, pushing it to $213million or more for the year, an increase of 33 per cent.

That would give pay TV about a 5.8 per cent share of the $3.7billion advertisers spent on the box last year.

Fitzgerald is predicting lower growth rates next year but still expects an additional $45 million will flow to pay.

While a tiny proportion is likely to be spent on its new digital advertising applications, that does not prevent Fitzgerald from using them to position pay TV as the mover and shaker in the market.

By May, MCN expects to relaunch the interactive or "red button" advertising products it launched on Foxtel last April, cutting the $50,000 fee it charges to create and host the applications, and adding two new products. Within a year, an advertiser's on-demand content should be fully interactive, enabling viewers to expand programming and request product samples or test drives by pushing the red button on their remote control.

"The only significant innovation the free-to-air networks have come up with in years is SBS putting advertising in-program," Fitzgerald says.

On the other hand, Allen says, at least SBS splits its signal to allow advertisers to buy the NSW market alone; Foxtel, despite its Sydney ratings muscle, does not.

The Australian

[DrP]

On demand advertising? Uh right. I demand to never see ads! (pretty please).

[GaryCook]

To my logic the better measure of PayTV would be to add the subscription and advertising $ revenues together. Then compare that with the advertising $ revenues earned by the FTA channels. After all, I pay my subscription to REDUCE the amount of ads I have to watch. Hence my attention span is spread over a smaller number of adds, which means better "penetration" for the advertisers.

cheers

[JB2]

xx

[Notverytechie]

An angry young man JB2?

I'm sure the PS3 'channel' will appeal to a number of people who want to check out the features of that product in more depth that can be achieved in a standard 30 second ad grab and will be very popular. Personally I won't checking it out, but as it is on-demand and although it will be on the hard-drive on my IQ I don't have to access it.

I think it is a good initiative.