This Advisory updates BIA/Kelsey’s Global Yellow Pages EBITDA Estimates & Forecast, originally published in February 2012. This year’s document covers the period 2007-2014. BIA/Kelsey estimates that global Yellow Pages EBITDA declined from US$14.0 billion in 2007 to US$7.5 billion in 2012. By 2014, total EBITDA will have fallen to $6.2 billion. Overall, directory margins have declined at a faster pace than revenue, due to downward pressure on traditional directory pricing and a shift from high margin print to lower margin digital products.
The global directory industry is adjusting to a "new normal" in terms of EBITDA margins.
Higher margin digital media like Internet Yellow Pages will not be the main digital revenue component going forward. The majority of digital revenue will come from lower-margin products.
EBITDA margins will not return to their peak levels of more than 50%. We expect margins to settle into a range of around 30% as publishers adjust to a mix of revenue that is majority digital.
There are opportunities to improve margins – efficiencies through mergers, smart segmentation of sales channels, and development of deep vertical content to reduce reliance on partners for traffic.