If CBS Radio were its own standalone company, it would play a major role in the generation of all U.S. local ad revenues in 2016.
That’s according to a 60-page-plus report released by BIA/Kelsey that delves into the likelihood that CBS Inc. won’t be selling of its AM and FM stations in the 26 markets where CBS Radio operates.
Of the $146.3 billion in U.S. local advertising revenues expected in 2016, $64 billion (44%) will be generated in the 26 markets in which CBS Radio competes. Digital/online local advertising in those markets is expected to generate $17.9 billion in 2016 and should grow rapidly. Radio advertising in those markets is estimated to reach $5.8 billion this year.
Based on 2015 revenue totals, CBS Radio is the No. 2 radio company, with $1.2 billion.
These dollars were generated by “only a fraction” of the number of stations owned by No. 1-ranked iHeartMedia ($2.6 billion).
The reason CBS Radio generates such large revenue, given its relatively small number of stations?
CBS Radio properties are concentrated in the major markets.
BIA/Kelsey research finds that the CBS Radio clusters generated 46.4 percent of the radio revenue in Hartford, 35.0 percent in New York, 33.5 percent of the radio revenue in Detroit, 33.1 percent of the radio revenue in Boston and Philadelphia and 29.4 percent in Chicago in 2015.
“CBS Radio has been in the commercial local radio business since the inception of radio stations in the U.S.,” said BIA/Kelsey CEO Tom Buono. “It has a long history of developing national and local entertainment and news programming. Much of that national programming migrated over to the television industry, but CBS has always had a commitment to strong local radio programming and that steadiness has been rewarded by strong ratings and local station revenues.”
The report on “CBS Radio Inc.” is the first in a series of public media company profiles BIA/Kelsey intends to publish.