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TV Proves Itself Into Our New Decade

By: 30 June 2010

Today we announced our revised forecast for the television industry. Previously we had been somewhat more conservative in our estimates because it was difficult to read which way the economic winds were blowing. And while the first half of this year showed that the winds were moving in the industry’s favor, we also feel that in the second part of the year the sails will be let down for good, but equal, third and fourth quarters similar to those in 2009.

Our estimated $17.5 billion in OTA income is a 10.9 percent increase compared with last year’s $15.8 billion. We think there are a few contributors to this respectable gain. First, there is a growing swing in advertisers returning to television, as evidenced in a recent story in Advertising Age and a point that we’ve often made at BIA/Kelsey that you still can’t deny the large amount of people you can reach with a local television station ad, despite DVRs, the Internet and other distractions.

Second and equally important, we have seen a pattern of advertising growth in non-election even-numbered years going back a decade, as evidenced in the below chart. Notably, in the years coming off a recession the industry picked up double-digit increases. Arguably, it’s easy to say that there’s nowhere to go but up after a negative year. However, we note that with consistency the industry always seems to be rediscovered after the times are bad, and we don’t see that changing anytime soon.

Our predictions for the half of the next decade remain positive and upward. Television remains poised as part of the invaluable media ecosystem; we’re always happy to report that.


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