2012 Finale For U.S. Ad Biz: 5.9% Rise

A Wall Street firm has increased its growth projection for the overall U.S. ad business for 2012, bumping it up from 4.9% to 5.9%. Big drivers include local TV stations and cable outlets, which drew huge revenues from political campaigns.

National networks, both broadcast and cable, are now projected to grow at a slower rate than before, according to Nomura. Overall, the TV ad business should grow at a higher rate (8.6%) than the ad economy as a whole.

Nomura had projected the local station business to grow by 10.3% and local cable by 10.1%. Nomura's projection has been revised upward to 16.3% and 17.1%, respectively.

The Big Four broadcast networks, however, have not fared as well with the firm’s predictions. Even with the holiday season impending, growth is not expected to match previous years. It has been revised downward from 5.7% to 3.5%. National cable networks, too, have gone down from a would-be 6.0% to 4.5%.

In the third quarter, the Olympics and some ratings trouble -- which might be related -- appear to have hurt CBS, ABC and Fox. Nomura has ad dollars dropping. While NBC rode the Olympics to more than $1 billion gain, CBS was down $54 million compared to the year before, ABC dropped $52 million and Fox fell $35 million.

The Internet projection has held steady at a 14.4% growth. Print, while still declining, may fare better: Newspapers were expected to decline 10.3%; now it is 7.9%. Consumer magazines were projected to drop 3.7%; now it is 1.9%.

As for 2013: the fiscal cliff is on Nomura’s mind, too. The firm is “concerned” with how early next year will be with “the election and holiday money” finished, but a fiscal cliff standoff could offer a huge headwind.

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