Cable Industry Eagerly Awaits Better Ratings System, SNL Kagan Says

The cable industry continues to be hurt by the lack of a comprehensive ratings system that captures both online and mobile, and Nielsen's much-promised rollout of such a system in Q1 could mean a couple of years of spiking advertising revenue growth, SNL Kagan reported Monday. The researcher said ad revenue growth -- expected to be about 4.5 percent in 2016 -- could hit 9.3 percent this year and 7.1 percent in 2018 before returning to its normalized rate of under 5 percent in subsequent years. It said the most successful cable networks will be those that get carriage on the basic packages of such over-the-top services as Dish Network's Sling TV, Sony's PlayStation Vue and Hulu's forthcoming service, plus others expected in coming years. Those virtual service providers' subscriber bases will go from fewer than 1 million in 2015 to nearly 12 million by 2025, SNL Kagan said. The report, pointing to the closing of Al Jazeera America and Pivot last year, predicted "a bleak outlook" for smaller independent networks with low ratings: "Shuttering networks with 60 million and 50 million-plus subs, respectively, would have been a completely foreign concept just a year ago." The firm said cable industry revenue growth overall looks healthy, but the top networks get most of that, and there will be continued mergers and acquisitions among the middle and lower-end operators, and more cable networks shutting down.