• by Jack Loechner , Staff Writer @mp_research, September 29, 2010

According to SNL Kagan, TV station political revenues in 2010 have the potential to grow at least 25% above 2006, to $2.5 billion, with political revenues for publicly-traded TV pureplays expected to exceed $300 million. In the 16 states with highly-contested elections, Sinclair Broadcast Group Inc. has the largest footprint of all TV pureplays, with 24 full power stations and an estimated 11.1 million TV households. Network O&Os are also expected to generate revenue from political advertising, with CBS and Univision having the most exposure to toss-up states

SNL Kagan Analyst Tony Lenoir notes: "In 2010, we expect that the combination of political unrest, high-profile congressional and gubernatorial races, and the Jan. 21 Supreme Court ruling that struck down certain laws restricting corporate and labor contributions to campaigns will lead to a political ad revenue treasure trove for broadcasters."

Broadcast results for the first half of 2010 show publicly traded TV pureplays have already generated more than $41.2 million in political advertising, up 48% from $27.9 million in 2006, when annual political revenue topped $198.1 million, or approximately 10% of total broadcast political advertising.

The Sinclair stations include WTTA in the Tampa-St. Petersburg-Sarasota, Fla., market (1.8 million TV households); affiliate WPGH in the Pittsburgh market (1.2 million TV households); and affiliate WSYX in the Columbus, Ohio, market (904,000 TV households).

In 2008, Sinclair generated $41.1 million in political ad revenue, or 5% of the total, up from $32.0 million, or 4% of the total in 2006. But 2010 could be a record year.

SinclairTelevision Division Vice President and COO Steven Marks says "For the first 6 months, we've booked $5.3 million of political, which is pacing almost twice as much as the 2.4 million booked at this point in 2006."

On the network side, ABC, CBS, FOX, NBC and Univision will also have significant exposure to this year's elections, as the five networks own and operate a total of 129 full power stations in 23 states where 20 gubernatorial, 18 senatorial and 324 House races will be held.

News Corp.'s FOX leads the pack overall, with 28 stations in 16 states counting 15 gubernatorial, 12 senatorial and 270 House races. ABC has the smallest footprint, with 10 stations in 8 states where seven gubernatorial, seven senatorial and 198 House races will be held.

CBS and Univision have the most exposure in toss-up states. CBS counts 29 stations in 14 states where 12 gubernatorial, 11 senatorial and 258 House races will take place, including 18 stations in states with highly contested elections: six in California, four in Pennsylvania, three in Florida, one in Colorado, one in Georgia, one in Illinois, one in Maryland and one in Washington.

CBS Corp. Vice President and CFO Joseph Ianniello said, "The total company should achieve its highest OIBDA margin of the year in the fourth quarter, driven by political advertising contributions, which could approach $200 million for the year."

Although TV stations will receive the lion's share of ad dollars, SNL Kagan indicates that radio will also benefit as political campaigns tighten TV inventory in the fourth quarter. Radio political ad revenue is expected to reach approximately $560 million.

Radio will benefit from the 2010 elections as political campaigns tighten TV inventory in the fourth quarter, says the report. While historically the political segment has fluctuated between 2% and 5% of ad revenue, this year's political contests will likely push it up to the top of that range, at approximately $560 million.

Among radio pureplays, SNL Kagan's analysis reveals Cumulus Media Inc. has the largest footprint in toss-up states, with a total of 114 stations. Despite the immense exposure of pureplays to highly competitive races, CBS Radio is likely to receive one of the largest windfalls in political advertising in 2010. The company owns 78 stations in 53 markets; including 50 stations, or 64% of the total, in California, Florida, Illinois and Ohio.

For more complete detail, including charts and graphs, please go to the TV analysis data here, and the Radio data here.