Commentary

Is Google A Threat To TV Stations?

Google local media revenue -- search and local advertising on YouTube -- is now at $19 billion, according to BIA Advisory Services.

For those scoring at home, that is virtually the same number that collectively, local TV stations pulled in local advertising, around $20 billion or so in a given year.

That should send shivers down the spines of TV executives. But from their point of view, it is a mixed bag, and one that should include -- if not give prominence to -- retransmission revenue.

Recently, BIA said traditional local TV advertising is estimated to be $18.2 billion this year -- with digital advertising adding $1.1 billion, and retransmission -- the increasingly strong revenue stream -- rising to $8.4 billion.

All this combined will yield 6% higher revenues versus a year ago.

How much do you think Google will grow? In three years, by 2022, BIA calculates Google will get to $27 billion. That a rise of 42%!  

Then consider this: We haven’t even figured in Google’s somewhat partner-in-crime, Facebook. (Google represents around 40% of all local digital advertising across all markets; adding in Facebook gives the pair a 48% share.)

Facebook has also been witnessing soaring overall advertising results over the past few years -- with more to come, despite some of its current data, privacy and accountability problems.

Some think all this is hurting more than the TV business. Newspapers, radio and out-of-home advertising have been taking it on the chin from big new digital platforms, both locally and nationally.

TV stations will continue to point to local TV programming, especially news, as their strong suit -- something that neither Google or Facebook are working toward. Staffing TV stations with on-the-ground reporters/editors doesn’t come cheap. TV stations continue to cling to this crucial point.

Plus, there is another growing factor: Around two-thirds of Americans get some of their news from Facebook.

But perhaps the local media factor will alter digital percentages. Consider those digital media platforms with the wherewithal to do big costly things. How much it is in their interest to go after another $20 billion that's in their sights?

1 comment about "Is Google A Threat To TV Stations?".
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  1. Ed Papazian from Media Dynamics Inc, May 8, 2018 at 12:31 p.m.

    Maybe Google as well as FB are "threats" to local TV stations and let's not forget "spot cable" which pulls away $7-8 billion annually----or radio or out-of-home media  or newspapers and their websites or city magazines.  That's life---and death ----in the media world. But, please don't cite the "ad spending" numbers, Wayne, as many of the "ad" dollars spent on Google locally would never go to the TV stations, anyway. These are direct response, search, and other ads used mainly for sales promotion purposes. At least look at the digital video ad dollars if that info is available. It's far more comparable.

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