• by Wayne Friedman , July 11, 2022

Linear TV advertising may take a bigger hit than streaming TV ad revenue -- which is still showing growth -- if a recession occurs over the next few months, according to one media analyst.

"It is our expectation total advertising budgets would decline modestly with streaming/advertising video-on-demand (AVOD) revenues still growing (although more modestly), while linear advertising revenues would be most susceptible to declines," Jessica Reif Ehrlich, media analyst at Bank of America, wrote recently.

However, Ehrlich says, overall TV ad declines would not be as significant as the declines during the short-lived, mid-2020 COVID-related recession, which witnessed 20% to 30% declines for a couple of months.

That marketplace then returned to somewhat more normal TV ad activity at year's end and into early 2021.

Ehrlich identifies three media companies that will take the most direct hits when it comes to declining advertising revenue during a recession: iHeartMedia, where advertising accounts for nearly 90% of revenues; Fox, which gets 42% of its revenues from ads; and Paramount Global, which receives about 40% of revenues from advertising.

Among the companies with better results are Walt Disney -- which gets 17% of its revenues from advertising -- and Warner Bros. Discovery, where 21% of its revenues comes from its advertising business.