MAGNAGLOBAL released an updated US media ad revenue forecast that anticipates media suppliers to generate $169.9 billion dollars of advertising revenues during 2010. On the back of continued improvements in the economy and the absence of a “double dip” return to recessionary conditions, MAGNAGLOBAL forecasts that the US advertising economy will grow by 2.1% during 2010, excluding Political and Olympic advertising on TV. This is marginally higher than our prior forecast of 1.6% year-to-year growth.
Including Political and Olympic advertising, they expect 3.4% total industry growth for 2010. They are effectively maintaining their long-term forecasts, with 3.6% average growth expected between 2010 and 2015, up from +3.5% previously.
For Q3, MAGNAGLOBAL forecasts that US media suppliers will collectively generate 2.4% more advertising revenue on a normalized basis than they did when compared to the prior year period.
Among the various sectors, television remains the largest ad platform in the United States. The $56.4 billion dollar segment will grow slightly faster than prior expectations, largely led by national cable, whose share of television ad revenues is in turn caused by a generally rising share of audiences.
Local television is also faring well, with results so far this year exceeding prior expectations – independent of political advertising, which will represent an additional source of growth for the medium this year.
Radio will show a 4.6% increase in 2010; a 2.5% increase in 2011; a 3.7% increase in 2012; 3.8% in 2013; 5% in 2014 and 5.3% in 2015. That’s a Compound Annual Growth Rate of 4.1% from 2010-2015.
Online advertising continues to grow rapidly, with double digit growth rates among many of the industry’s sub-segments – especially Online Video and Paid Search as well as Internet Yellow Pages. But growth for digital media is partially held back by weakness in the Online Classifieds sector, and the depth of this weakness has caused us to slightly reduce expectations for the sector as a whole even as online advertising and digital media continue to increase in importance for advertising.