Forecast: Radio To Lose Revenue To Digital

Brian Wieser

Over the next week, analysts will release their forecasts for 2016 spending and beyond, giving media buyers and planners a fuller picture of the health of the media economy as the new year begins.

The first of those, reports Medialife, from Pivotal Research Group’s Brian Wieser, says this year was actually better than expected, and he thinks the next few years will be steady, though traditional and even new media will face some new obstacles to growth.

Through 2020, the media economy will grow at a compound annual rate of 3.7 percent, including Olympics and political.

But local spending will lag, with local radio, newspapers and TV being hurt disproportionately by gains in digital dollars from small businesses. Local will fall 1.3 percent in that span.

Wieser has reduced his forecast for local and national TV ad spending over the long term by a few tenths.

He notes that some advertisers have shifted money in their budgets from TV to digital, though he also says they probably have not moved as much as people think.

“We think local TV (ex-political) advertising will generally be flat in years ahead, compressed by the many of the same trends constraining other local media, if to a lesser degree,” he writes.

He also says radio will fall 1 to 2 percent each year, and part of that will be due to a move to digital by small businesses. This trend has already badly hurt local newspapers.