Viacom Loads More Ads on Channels

Fewer people have been tuning into some of Viacom’s cable channels over the past year, so the company has turned to a timeworn but controversial method of maintaining ad revenue: adding more commercials.

According to data from TV-research firm Nielsen, the media conglomerate's Nickelodeon and Comedy Central networks boosted the amount of ad time they aired in the first half of 2012 by 9% from a year earlier, to a combined 1,901 hours. That followed a 7% rise in all of 2011 and a 4% rise in 2010, Nielsen found. As viewership drops at some of Viacom's channels, what the company receives for a typical commercial spot can decrease. Increasing the amount of commercial time allows Viacom to make up some of the impact of the sharp ratings declines. Viacom's U.S. ad revenue fell 7% in the June quarter from a year earlier, after rising 1% in the March quarter. But that compared with a 29% drop in viewership at Nickelodeon, one of the company's biggest channels, in the first half of the year, according to a report by Barclays Capital, based on Nielsen data. Other Viacom channels, including Comedy Central, have also lost viewers, but by a much smaller degree.