BIA/Kelsey Projects Rising Radio Revenues in 2010

RADIO ONLINE | , ,

BIA/Kelsey projects the radio industry will begin to see slight increase in ad revenue in 2010, after several years of negative revenue changes. The company's quarterly "Investing In Radio Market Report" reflects an 18.4% decline in radio ad revenues to $13.7 billion. BIA/Kelsey predicts industry revenues to hit $13.9 billion this year.

Even though the company sees small gain of 1.5% in 2010, it forecasts the start of 2-4% annual growth rate over the next few years, including a predicted 16.5% compound growth rate from web and other online revenues.

"While the poor economy held it down momentarily, radio is coming back to demonstrate that it is an important advertising vehicle, particularly in local media markets," said VP Mark R. Fratrik, Ph.D. "The industry will continue to grow its online revenues in 2010 as increasingly more progressive radio groups recognize they are more than just over-the-air transmitters and begin to integrate cross-platform promotions with their broadcast and web operations."

Fratrik also noted that the full year 2009 saw a continued slow pace in station transactions, with only $400 million in total value of radio stations that were sold. BIA/Kelsey believes the pace of acquisitions should increase in 2010 as operators will be attempting to get additional properties that offer efficiencies of scale to their operations.

"A lack of debt financing has been hampering the industry but we expect a modest rebound to begin in the early part of the second half of the year," added Fratrik.