• by Wayne Friedman , June 18, 2008

Over the next four years, the greatest TV/radio revenue potential appears to be West Coast markets and those with a growing Hispanic population, according to media researcher SNL Kagan.

Three of the top five growth markets for TV are in California--with Las Vegas leading the way, estimated to get 6.2% compounded annual growth rate (CAGR) from 2007 to 2012. It's also expected that Las Vegas will see a 7.9% retail growth rate over that period.

San Diego slots in No. 2 at 6.1% CAGR and an 11.9% retail growth rate. Los Angeles places third (5.7% CAGR, 7.7% retail), then Phoenix (5.6% CAGR, 6.4% retail) and San Francisco (5.6% CAGR, 7.3% retail).

Overall, SNL Kagan projects TV revenues to grow at 3.9% over the next five years--with TV ad revenues expected to rise 8.8% in 2008, specifically because of increased TV advertising due to the presidential election.

Radio markets can expect some lower returns. San Diego will get the best result with a 2.0% CAGR and an 11.9% retail growth rate. Riverside, Calif. is next (1.9% CAGR; 10.1% retail), then Stockton, Calif. (1.9% CAGR, 11.9% retail), San Jose, Calif. (1.9%, 8.9%); and Fresno, Calif. (1.9%, 10.7%).

SNL Kagan estimates that radio's five-year annual revenue growth will be 1.1%. Western region markets will be the best performers, with 13 of the top 20 markets by revenue in California.

The slowest-growing TV and radio markets will be in the Great Lakes area, mostly due to slow retail growth and auto industry problems. Growth there will be 2.7% for TV and 0.9% for radio. The Central South region--particularly the markets still recovering from Hurricane Katrina--are also at the bottom. Projected revenue growth is 2.8% for TV and 0.8% for radio.