Barclays Revises Ad Forecast, Dips Down

U.S. advertising growth and TV advertising growth is estimated to be lower than expected for the rest of the year and way down in 2013, according to one analyst.

Barclays Capital analyst Anthony DiClemente said the overall U.S. advertising market is expected to grow at 4%, down from a 4.6% projection. Conditions will drop in 2013 with advertising growth at a weak 1.9%. He had estimated 2.3%.

In 2013, the only media platforms expected to grow are the Internet (17.2%), cable TV (7.2%); outdoor, (3.5%); and radio (0.7%).

Concerning this year, DiClemente says national broadcast TV ad growth projection will now be 8.6% for the calendar year 2012 versus a year ago -- down from a 9.2% projection. DiClemente expects cable TV network growth to be 7.2%, down from a 7.5% estimate this year. Much of this is due to strong results from Olympic and political advertising.

Near term -- the fourth quarter -- TV advertising growth is expected to climb because of better comparisons to the fourth quarter of 2011 -- which he says was the slowest advertising rate in the last nine quarters. He also credits mid-single to high-single-digit percentage price increases in the period, and a tightening of the TV ad market due to high political advertising activity.

Next year, he believes there will be a dramatic shift -- with broadcast TV sinking in advertising revenues. National broadcast network will decline 2.1% for 2013; he predicted it would be down 1.0%. Local TV advertising will have it worse -- losing 6.9% in ad revenues next year. DiClemente's previous estimate was 6.4%.

Cable networks, however, will continue to climb to higher levels. Now he says advertising for cable networks will be at 7.2%, down from a 8.0% estimate.



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