SNL Kagan: Broadcast-Ad Revenue Will Fall For Foreseeable Future
This story was written by Rory Maher.
How bad can it get for TV and radio broadcasting? How about revenue declines for at least the next five years? That's what a new report being released today by SNL Kagan predicts. Following revenue declines of 10 percent and 7 percent for radio and TV, respectively, in last year, Kagan predicts accelerated declines of 15 percent for both this year. That number will stabilize somewhat after 2009, but Kagan forecasts annual declines of about 2 percent for radio and TV for five years starting in 2010.
The worst-hit market will be Detroit (declines of almost 20 percent this year, and five-year annual declines in the 3 percent to 5 percent range), while Washington, D.C., is expected to be the strongest market (flat revenue growth over the next five years), according to the report. In Detroit, the loss of local auto is a major factor, while in D.C., the big increase in government spending and people moving from banking jobs to government jobs will help.
Tellingly, the report starts to talk about broadcast performance in terms of "survival," illustrating just how bad Kagan believes things have gotten for the challenged industry. The report's researcher says the broadcasters that can create viable digital businesses and figure out other revenue streams besides traditional advertising will be the ones that make it.
By Rory Maher