Ad boom for China state-run TV

Olympics, foreign buyers drive 16% increase in CCTV bids

Bids for primetime advertising spots on China Central Television next year have risen to 6.79 billion yuan ($862.6 million), up 16% from bids submitted for 2006, the state-run flagship network said over the weekend.

Driven largely by a 25% jump in bids from foreign brands and excitement around new ad products related to the 2008 Summer Olympics in Beijing, CCTV's annual primetime ad auction drew bids of nearly 1 billion yuan more than the 5.86 billion yuan bid for 2006 primetime ads.

U.S. consumer goods giant Procter & Gamble, maker of Crest toothpaste, was the highest bidder for primetime ads for the fourth year in a row, with bids totaling 420 million yuan ($53.4 million), up from 390 million yuan in bids for its 2006 ad buy.

Ad bids from overseas companies rose 25%, while bids from private Chinese companies and domestic state-owned enterprises rose 21% and 20%, respectively, Guo Zhenxi, director of CCTV's advertising and economics center, told the Beijing News on Sunday.

Guo said he had a "contradictory feeling" about the role CCTV plays in helping foreign brands enter the Chinese market.

"As the person responsible for the CCTV advertising business, I welcome more international brand names onto our platform," he said. "At the same time, I am very worried about how international brands use this platform. They may pressure the growth of domestic brand names."

CCTV added several new advertising products to its annual auction, an event that has seen its participation grow tremendously in recent years, keeping pace with China's overall economic boom, Guo said.

Official Olympics sponsor PC maker Renovo Group, the Chinese computer maker that bought IBM's laptop business last year, bid 162 million yuan ($20.6 million) to win the right to put its name on the daily ad spot around the evening news broadcast that will count down the 500 days to the Olympics beginning Mar. 27.

Chinese banks and car makers again were prominent among the top bidders. Fierce overseas competition is expected in these the industries when they open to foreign investors next year under the terms of China's accession to the World Trade Organization.

The Bank of China, with a bid of 82.7 million yuan ($10.5 million), won the right to sponsor the upcoming CCTV variety and trivia program "My Olympics." BOC also took home the right to sponsor the televised contest called "Who Will Host the Beijing Olympics?" with a bid of 45 million yuan ($5.7 million).

Another top bidder was Inner-Mongolian dairy Meng Niu, the sponsor of the popular "Super Girl Voice" TV singing contest, which challenged CCTV's entertainment arena dominance last year from its perch on central China's Hunan Satellite TV network.

Guo said he hopes that these and other local enterprises will soon become internationally recognized through exposure gained on the expanding CCTV platform, where ad revenues are expected to exceed 9.2 billion yuan in 2006 and 10 billion yuan in 2007.

CCTV is broadcast around the world and has English-, Spanish- and French-language channels.