• by David Goetzl  @dgoetzl, September 8, 2006

Political ad spending and the Olympics are crucial to the local station business. Which is why the Television Bureau of Advertising prediction that spot revenues would be down by as much as 3 percent next year is cause for concern. While that decline may be accelerated by some slowness in the auto category, the lack of political races and Olympics is the principal issue.

TVB's overall predictions are for a 1 percent to 3 percent drop in spot dollars versus this year, propelled by a weak national spot market. The forecast calls for a 7 percent to 9 percent decrease in national spot dollars in 2007, with local spots either flat or up 2 percent. Another potential factor affecting next year's revenues is slumping local auto advertising, perhaps caused by high oil prices.

One bright spot for local stations in 2007 is TVB's projections of a 30 percent to 40 percent gain in ad revenue from station Web sites. Stations have been aggressively ramping up content and ad opportunities on their sites to compensate for softness in traditional spots and dots. Traffic on TV station sites as a group is growing, and they receive more unique users than MySpace and Weather.com. In 2008, with the Beijing Olympics and a presidential election, TVB predicts that spot dollars will balloon with an 8 percent to 10 percent increase, powered by national spot up 12 percent to 14 percent. Local spot is expected to jump 5 percent to 7 percent. TVB's predictions are compiled with guidance from Wall Street, financial analysts, and other research groups, as well as rep firms

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