Fox ends reduced advertising scheme

15 May 2009

NEW YORK: Fox, the US broadcast network, is halting its "Remote-Free TV" scheme, which saw the station run fewer ads during some of its most popular shows in exchange for charging marketers higher rates for the limited number of available slots.

The initiative, which was formally launched late last year, meant that only five minutes of ads were shown each hour during series such as Fringe and Dollhouse.

A study from Magna, the media agency, released in October 2008 found that the strategy had resulted in a "major improvement in audience retention."

This included an increase in the number of viewers watching an entire ad break during Fringe to 92%, compared with Fox's average of 88%.

It is estimated some advertisers paid up to 40% more for spots during shows falling under the auspice of Remote-Free TV, but Fox has reported that its overall revenues from the venture did not match those for its standard advertising schedule.

As such, Jon Nesvig, the company's president of advertising sales, argued that while "advertisers liked it," the service "doesn't seem to be economically viable in a year where there is the emphasis on price that there seems to be."

However, Fox also said it may employ a similar approach for one-off events, or for one-off occasions such as film premieres, in the future.

Estimates recently published in Advertising Age suggest revenues from the next round of TV upfronts will fall by a minimum of 10%, to $8.2 billion (€7.4bn; £6.6bn), on an annual basis as advertisers continue to cut back their marketing expenditure.

Data sourced from Wall Street Journal/AdAge; additional content by WARC staff