BIA/Kelsey Sees Prospects
for Radio Industry
Revenues Increasing in 2010
After Bottoming Out Last Year at $13.7 Billion
Q1 Transaction Volume
Indicates Operators
Looking for Strategic Acquisitions
CHANTILLY, VA. March 24, 2010
– The radio industry will begin to see slight broadcast advertising revenue
increases in 2010, after several years of negative revenue changes and a
very difficult 2009, according to
BIA/Kelsey,
advisers to companies in the local media space. BIA/Kelsey’s first edition
of its quarterly
Investing In Radio® Market Report
shows that 2009 closed with $13.7 billion in revenues for radio from
broadcast and online sources, a decline of -18.4 percent from 2008. The
company predicts industry revenues to hit $13.9 billion this year, an
increase of 1.5 percent, but more importantly, the start of 2-4 percent
annual growth rate over the next few years, including a predicted 16.5
percent compound growth rate from web and other online revenues.
“While the
poor economy held it down momentarily, radio is coming back to demonstrate
that it is an important advertising vehicle, particularly in local media
markets,” said Mark R. Fratrik, Ph.D., Vice President, BIA/Kelsey. “The
industry will continue to grow its online revenues in 2010 as increasingly
more progressive radio groups recognize they are more than just over-the-air
transmitters and begin to integrate cross-platform promotions with their
broadcast and web operations.”
Dr.
Fratrik also noted that the full year 2009 saw a continued slow pace in
station transactions, with only $400 million in total value of radio
stations that were sold. The pace of acquisitions should increase in 2010
as operators will be attempting to get additional properties that offer
efficiencies of scale to their operations.
“A lack of
debt financing has been hampering the industry but we expect a modest
rebound to begin in the early part of the second half of the year,” Fratrik
said.
BIA/Kelsey – 1st Edition
Investing In Radio – 2
The below
chart represents BIA/Kelsey’s five-year forecast for the radio industry:
Click here for a larger image of this chart
This slightly optimistic forecast is encouraging the radio industry
to explore unique ways to improve revenues. However, this still relies on
its ability to embrace maturing mobile and online vehicles
and learning how to coexist with new and developing technologies.
Digital Strategies for
Broadcasting 2010
For a second year BIA/Kelsey will hold
Digital Strategies for Broadcasting 2010
(formerly Winning Media Strategies) from May 17-19 in Jersey City, NJ
(across from Manhattan Island). DSB will focus
on the hundreds of millions of dollars that
broadcasters are poised to earn from the digital services that are
transforming the industry, with a particular emphasis on web sites, mobile
apps, HD Radio, emerging technologies, integrated platforms, and Internet
radio.
“This can
be a very transformative year for radio broadcasters if they leverage their
properties with the technologies that their listeners embrace,” said Rick
Ducey, chief strategy officer of BIA/Kelsey. “If they can find and maintain
compelling niches in the local media ecosystem they will not only increase
their audiences but also their revenues. Digital Strategies for Broadcasting
is designed as a conversation for what those in broadcasting can do now as
well as what they should do to prepare for tomorrow. It will serve as a
forum to meet potential new partners and exchange ideas among peers.”
BIA/Kelsey – 1st Edition
Investing In Radio – 3
Emmis
Communications CEO Jeff Smulyan will keynote DSB on its third day. In
addition, more than 30 other speakers are scheduled to present, including
Michael Goodman of Mercury Media discussing how consumer and social trends
will impact the media business, and a session on what’s working in
broadcasting, Internet and mobile, with Flycast CEO Dave Kennedy and Skip
Pizzi, a media technology consultant. Other confirmed programs are on
reinventing local radio, creating revenues from new platforms, and how to
make cross-platform deals and partnerships.
Additional details and registration information is available at:
http://www.kelseygroup.com/dsb2010.
Investing in Radio
A
comprehensive profile of each of the 300
Arbitron-rated markets with historic and projected market demographic and
financial statistics is available in the first edition of the
quarterly Investing In Radio® Market Report and the new
2010 Investing In Radio® Ownership Report published by
BIA/Kelsey. Both publications are part of the Investing In
financial guide series that includes
estimated advertising revenues, technical
data, ownership and acquisition information, and more for every market.
Information on these publications is available on the BIA/Kelsey website at
http://www.bia.com/publications_reference_radio.asp#radio1.
BIA also publishes
investment reference guides and provides data services for the television
and newspaper industries. For more information, call 800.331.5086 or email
info@bia.com.
