Financial Focus: Radio Rebound
A day after Viacom subsidiary Infinity Broadcasting reported a strong first quarter, the Radio Advertising Bureau said advertising revenues rose by double digits in March 2004 compared to the same period a year ago.
Total advertising revenues in the Radio Advertising Bureau Index of Radio Revenue Pool Numbers rose 10 percent in March. Local revenues continued to be stronger than national, with an 11 percent jump in local ads compared to March 2003 in the 150 markets measured by the RAB. National advertising revenues rose 5 percent.
No doubt part of that double-digit increase was due to easier comparisons to March 2003, when the war in Iraq scratched what had been a nice recovery in radio. While there would be something of a comeback in the summer of 2003, radio dipped again in the fourth quarter. Only recently have radio advertising revenues started to return.
For the first quarter, radio revenue rose 4 percent compared to the same period a year ago. Local continued to be stronger, with an increase of 5 percent compared to a 1 percent rise for national. Local has led national ads in this recovery.
"We are seeing the beginning of radio's recovery with the March revenue results. Advertisers are starting to place buys earlier in the cycle, which boost the national business, and local continues its forward momentum," said Gary Fries, president and chief executive officer of the RAB, in a prepared statement.
On Thursday morning, Viacom reported stronger results for its radio unit, Infinity Broadcasting. After a lackluster year--shared by most in the radio business--Infinity began to show strength. Radio revenues rose 3 percent to $455 million in the first quarter. Viacom President Mel Karmazin said that local advertising revenues were outpacing national. And it was the bigger markets that led the way, with Viacom's top 10 markets increasing revenues by 6 percent. Karmazin singled out New York, Los Angeles, San Francisco, and Boston.