Television advertisers are trying to pull back on deals with broadcast and cable outlets as the coronavirus continues to hit the U.S. economy hard, according to a published report Tuesday.
Most of the $42 billion being spent on national ads in the U.S. this year is under long-term contracts, according to the report. However, new options that became available to advertisers at the start of May could lead to cancellation of as much as half of spending in the third quarter, the report said.
The impact of sports cancellations has been particularly intense.
Last month, researcher EMarketer told the Los Angeles Times it expects ad spending tied to sports to come in $10 billion to $12 billion below its previous forecasts for the first half of the year. That's off between 22% and 29% from the same period a year earlier when the industry took in nearly $34 billion.
Those being hurt include Disney’s (DIS) - Get Report ESPN, ViacomCBS (VIACA) - Get Report, AT&T’s (T) - Get Report Turner, and Comcast’s (CMCSA) - Get Report NBC. The postponement of the summer Olympics in Tokyo to 2021 resulted in a $1.2 billion hit to NBC, according to the report.
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Disney shares fell $3.21, or 3%, to $104.56 Tuesday. Shares of PepsiCo lost $1.44, of 1.1%, to $132.94. ViacomCBS gained 21 cents, or 1.2%, to $18.25. Comcast fell 81 cents, or 2.2%, to $35.35. AT&T fell 49 cents, or 1.7%, to $28.89.