After a lacklustre 2003, US spot TV revenues will increase by more than 10% next year, according to the Television Bureau of Advertising.
The association, which represents America’s broadcast television industry, held its annual forecast conference last week and analysts were broadly positive about prospects for the near future.
The first half of 2003 saw only limited growth for spot TV (see US Television Revenues Nudge Up 2.1% In H1) but there a was a marked improvement in July with revenues up by 8%, according to Nielsen Monitor-Plus (see Advertisers Switching Back To Spot TV). However, TVB remains circumspect predicting that full year spending will probably be at the low end of its 1-3% growth forecast. This is still more favourable than the Merrill Lynch estimate of -0.9% (see Merrill Lynch Tweaks Advertising Forecasts).
TVB anticipates that spot TV will rise 10-11% in 2004 with national growth (14-15%) exceeding that of local (7-8%). In the meantime, network TV is expected to increase by 7-8% with syndication climbing 5-6% and cable up 8-9%.
Television bosses are banking on the summer Olympics and the US presidential election to drive spot TV revenue growth but Merrill Lynch has reservations about the latter, claiming that political spending is set to be 10% lower in 2004 than 2002. The broker also states that the economic recovery will be slower than hoped for and it is only projecting a 6.2% increase in spot TV revenues next year.
With no major political or sporting events to look forward to, analysts are already predicting that 2005 will be more difficult with TVB predicting that growth in spot TV revenue growth will be in the region of 2-4%.
“The structure of the business has changed dramatically since the Olympics switched to a two-year frequency,” said TVB President Chris Rohrs. “Odd years will always face tough comparisons to even years, when spending on both the Olympics and political ads show up. Therefore, we think a two-year forecast is called for.”
