Commentary

Radio Poised for Slow, Steady Growth

by Jack Loechner , Staff Writer @mp_research, April 2, 2010

According to the BIA/Kelsey Investing In Radio Market Report, 2009 closed with $13.7 billion in revenues for radio from broadcast and online sources, a decline of -18.4% from 2008. The company predicts, though, that industry revenues will hit $13.9 billion this year, an increase of 1.5%. More importantly, says the report, it represents the start of 2 to 4% annual growth rate over the next few years, including a predicted 16.5% compound growth rate from web and other online revenues.

Mark R. Fratrik, Ph.D., Vice President, BIA/Kelsey, notes that "... radio is coming back... (as) an important advertising vehicle, particularly in local media markets... the industry will continue to grow its online revenues... as more progressive radio groups... begin to integrate cross-platform promotions with their broadcast and web operations."

2009 saw a continued slow pace in station transactions, with only $400 million in total value of radio stations that were sold. 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.

BIA/Kelsey's five-year forecast for the radio industry looks like this:

Five Year Radio Forecast (Revenues in U.S. Billion $)
*Year*	*Broadcast Revenues (Bil$)*	*Online Revenues (Bil$)*	*Total*
2008	$16.5	0.3	16.8
2009	13.3	0.4	13.7
2010	13.5	0.5	13.9
2011	13.7	0.5	14.3
2012	14.1	0.6	14.7
2013	14.6	0.7	15.3
2014	15.1	0.8	16.0
Source: BIA/Kelsey, March 2010

This slightly optimistic forecast still relies on its ability to embrace maturing mobile and online vehicles and learning how to coexist with new and developing technologies.

Rick Ducey, chief strategy officer of BIA/Kelsey, concludes "... a very transformative year for radio broadcasters... If they can find and maintain compelling niches in the local media ecosystem they will... increase their audiences... (and) their revenues.

More information about this report, and additional sources noted for radio reference publications as well as company blogs may be accessed through this site.

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4 comments about "Radio Poised for Slow, Steady Growth".

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David H. Deans, April 2, 2010 at 10:58 a.m.
You describe this as a "slightly optimistic forecast" -- and I would describe it as a fantasy that's beyond the comprehension of anyone who sees the apparent trend. IMHO, traditional radio broadcasters in the U.S. market, as an example, have little hope of regaining any upside momentum from their current business practices.
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Jonathan Mirow from BroadbandVideo, Inc., April 2, 2010 at 5:20 p.m.

Did someone just get their Medical Marijuana card?

Dave Barnes from MarketingTactics, April 5, 2010 at 10:02 a.m.

"a decline of -18.4%" would be an INCREASE of 18.4%.
At least that is what I learned in math class.

Maybe the intake of medical marijuana explains the sloppy writing.

Jonathan Mirow from BroadbandVideo, Inc., April 5, 2010 at 6:24 p.m.

Epic Digital Fails of the last Century: #1 (with a bullet) Newspapers, #2 (and coming up the charts fast) Radio, and can that old standby Broadcast be far behind? I think not...