By the end of next week, we may see the RAB figures for November radio revenues, but Bank of America analyst Jonathan Jacoby is pretty pessimistic about what the numbers will show. Jacoby has been checking with large market sources and found that their revenues were down about 7%, much worse than the 3% decline he had anticipated. Those big markets account for about 35% of all radio billings. So, while the story may not have been so bleak in medium and small markets, he has lowered his November revenue estimate to a decline of 5% from his previous 3%.
“We are also lowering our Q4 ’07 industry revenue growth estimate from a decline of 2% to a decline of 3%, and lowering our annual 2007 estimate from a decline of 1% to 2%. Our checks indicate that business will remain sluggish for the remainder of the year into early 2008. Political has yet to be a factor for radio,” Jacoby told clients.
RBR observation: This is shaping up to finish a year best forgotten as one that is just getting worse. CL King analyst Jim Boyle has also said that November is likely to be down 4-5% (12/20/07 RBR #247). There appears to be no way for Santa to deliver a December that will produce a positive number for the whole year. The big worry now is whether there is anything on the horizon to keep 2008 from being more of the same. Political will help, but a real improvement in the general advertising climate is what is needed.