Cablers campaigning for votes

Execs tout niche markets in bid for political spending dollars

WASHINGTON -- The nation's big cable companies are taking aim at one of broadcast television's last cash cows as they hope to turn their newfound ability to target small segments of voters into advertising dollars.

Cable industry executives think they can help supplant broadcast television as the dominant political medium as politicians look for ways to reach smaller slices of the electorate.

"Broadcast television is targeting by machete," Comcast executive vp David Cohen said. "What cable lets you do is target by scalpel. There's much less blood loss."

Cohen, Time Warner COO Landel Hobbs and Cox Communications CFO John Dyer were part of Wednesday's Washington conference aimed at campaign managers, media buyers, elected officials and their aides that attempted to convince them of the newfound value of cable advertising.

Tired of seeing political campaign dollars flow to broadcasters, the cable industry formed the National Cable Communications as a one-stop shopping service for media buyers.

NCC vp political strategy Chuck Cowdrey said the fragmentation of the U.S. television marketplace works to cable's advantage. That fragmentation, combined with cable's new ability to aggregate ad sales should make the industry a player in the political advertising game.

"It wasn't that long ago that a 30-second spot and a couple of million bucks would get you elected in this town," he said. "But people are just watching TV in a different way today."

In late 2006, the NCC hired two noted political strategists to help it expand its political ad business. Back then, Tim Kay joined the NCC as director of political strategy, with Nina Veruete as director of political communications.

Last year's midterm elections were a boost for many in the broader media and entertainment industry, and 2008 looks like a strong year again given an early campaign start, narrow races and the Democrats' small congressional majority.

Comcast, the largest U.S. cable operator led by chairman and CEO Brian Roberts, has in recent years focused on expanding its advertising revenue and gaining ad market share from local TV stations, and political ads have been one key battleground.

The company's 2006 advertising revenue increased 13% compared with 2005 to $1.7 billion. Comcast reported political advertising revenue of more than $90 million for 2006.

Overall, U.S. ad spending jumped 4.6% in 2006, according to Nielsen Monitor-Plus, which like The Hollywood Reporter is owned by the Nielsen Co. Political advertising was up 24% compared with the previous midterm elections in 2002, making it one of the big drivers of the increase, the company found.

Research firm PQ Media estimated that cable won about 8% of the $1.7 billion spent on political ads on TV last year, doubling its 4% share of the 2004 haul of $1.6 billion.

After a more sluggish 2007, experts forecast another political ad spending boon in 2008 from the presidential election. However, with the campaign already well under way and several primaries taking place earlier this time, observers have predicted somewhat of an election spending boost in the back-half of the current year.

CBS Corp. president and CEO Leslie Moonves, for example, suggested at the start of the year that "2008 political (advertising) could creep into 2007" thanks to the earlier primaries (HR 2/28).

Cowdrey signals a hope that cable will continue to grow its share of that ad spending pie, arguing that cable can deliver where broadcasters can't.

"In the battleground states, there are (millions) of people over 35 who vote that don't listen to broadcast news," he said. "Each voter in their homes must be targeted individually."

Marrying cable programming with demographic data compiled by companies like Nielsen allows candidates to target a specific niche in a specific area, one that is much smaller than a broadcast outlet's area, Cowdrey said.

"Advances we've made enable you to target voters like never before," he said.

Cable operators are hoping that the new tools will enable them to give broadcasters a real run for their money during this campaign. "It's another strategic business for us," Hobbs said. "Just follow what you do at home. Your voters are doing the same thing."

Georg Szalai in New York contributed to this report.