American Movie Classics quietly took another step toward a more full commercial load at the start of the month, inserting so-called "commercial intermissions" into its movies.
The network started showing one such 60-second to 90-second break per film on Oct. 1.
AMC Networks president Kate McEnroe last week downplayed the move as "nothing very dramatic." She said that AMC has done much the same with its original programs for a few years.
The movie channel now averages about two commercial minutes every two and a half hours — well below the typical basic-cable network allotment of 12 to 14 minutes per hour. But the network's biggest "classic" films rival, Turner Classic Movies, remains committed to its commercial-free status, a spokesman said.
Another rival — Fox Movie Channel, which shows a range of films produced by 20th Century-Fox — also doesn't insert commercials into movies.
Although AMC buyers have included some direct-response marketers, McEnroe said major national advertisers have also bought time. They include Merrill Lynch & Co., Ford Motor Co. and General Motors Corp.
Asked how much notice AMC gave its affiliates, McEnroe said that under AMC's affiliation contract, "we have the right to do this."
"Nobody [from the affiliate side] called" about it, she added.
AMC has 81 million subscribers, up from about 75 million a year ago. Affiliates don't sell local avails.
As for viewer feedback, McEnroe estimated that some 200 calls or letters had come in through last Wednesday. The queries were "more curious," and callers didn't voice an opinion either way.
By far the most negative response came in a column from New York Post
critic Adam Buckman last Tuesday, she said.
Past focus-group research has found that many viewers "have said they like to take a break" while watching movies on television, McEnroe said. And network officials have long said that many AMC viewers thought the network had always shown ads.
McEnroe cited increased spending on original productions and contemporary-film acquisitions. She wouldn't provide revenue figures, but said the additional advertisements would "cover our original-production budget" and the increased spending on films.
In Rainbow Media Holdings Inc. parent Cablevision Systems Corp.'s latest quarterly report (released in August) AMC reported that its net revenue rose 13 percent, to $54.6 million, and adjusted operating cash flow rose 13 percent, to $28.4 million. Cablevision cited a 4 percent increase in subscriber viewership, affiliate rate increases and an 89-percent rise in sponsorship revenue, to about $6 million.
WE'S Up Next
Rainbow sibling WE: Women's Entertainment, which has had Johnson & Johnson as its exclusive sponsor since March, will increase its commercial load next year. WE will go into next spring's upfront marketplace selling eight minutes per hour in network inventory, McEnroe said.
In 1998 — when WE was known as Romance Classics — the network said it would go the ad-supported route in fall 1999. It then backed off to concentrate on brand-building and program acquisitions.
AMC has also had some changes of heart with respect to romancing advertisers. In early 1997, the network backed away from a plan to sell limited sponsorships, only to revisit the plan in 1998. By that fall, AMC began repositioning its strategy as one of marketing partnerships, rather than sponsorships.
Bravo, another Rainbow network, has increased its presence as an insertable channel on local cable systems by about 5 million this year to some 37 million subscribers, senior vice president of local ad sales John Duff said.
In fall 1998, Bravo boosted its commercial load to three breaks per hour, after airing limited Public Broadcasting Service-style sponsorships. It began offering local avails in spring 1999.
Duff projected that Bravo could hit 40 million insertable subscribers by year-end. Bravo's overall count reached 60.8 million subscribers this month, up nearly 12 million over a year ago.
That growth will draw attention on Madison Avenue, according to Bravo Networks executive vice president of affiliate sales and marketing Gregg Hill.
"Things start to change when you get to 60 million," Hill said. "You get to critical mass."
