Fox Wants to Reduce Ad Time to Two Minutes per Hour by 2020

Network announced the target at an event it hosted to discuss TV advertising’s challenges

Fox has set a goal to reduce ad time in its TV shows. 

   

Alexandra Bruell

March 6, 2018 6:00 a.m. ET

Fox Networks Group’s ad sales chief, Joe Marchese, is setting a lofty goal for the broadcast network: reducing TV ad time to two minutes an hour by 2020.

Mr. Marchese announced that target at a private industry event it hosted last week in Los Angeles, where advertisers, buyers and executives from rival media companies discussed TV advertising’s woes.

Bringing commercial time down to only two minutes would be a major change. In 2017, the average amount of ad time an hour on broadcast was a little over 13 minutes, according to Nielsen. On cable it was 16 minutes.

For Fox to avoid a steep revenue drop-off, it would likely need to charge a lot more money for the scarce inventory it has left after cutting ad time to two minutes.

The shift is contingent on the industry changing the way it buys and sells media. Mr. Marchese wants to sell ads using a metric based on time spent with content, versus the number of views.

“The two minutes per hour is a real target for Fox, and also our challenge for the industry,” said Ed Davis, chief product officer for ad sales at Fox Networks Group, in an email. “Creating a sustainable model for ad-supported storytelling will require us all to move.”

Mr. Marchese’s 2020 goal was part of his closing remarks. “It was sort of an aspiration or goal. Not a declaration,” said one ad buyer who attended the event. “His whole closing section was about the value of the commercial and if they can provide more value by limiting commercials and creating new commercialization it will be better for networks’ health and better for advertisers.”

The move is in line with a trend toward fewer ads on TV, as consumers increasingly ditch ad-supported cable and broadcast television for ad-free streaming platforms like Netflix and Amazon.

“We did reduce ad time by 75% in FX Originals on-demand last year, and saw great effectiveness in brand lift,” said Mr. Davis. “We are tuning our approach with the new targeting and ad products so we can scale more widely.”

21st Century Fox, which owns the Fox broadcast network and cable channels like FX, shares common ownership with Wall Street Journal parent company News Corp.