• by Joe Mandese  @mp_joemandese, October 1, 2007

At a time when the television medium seems besieged by an unprecedented array of new obstacles - the rise of digital video recorders, advertising clutter, fractionalization, and the migration of viewers and content to online video - one of Madison Avenue's top media shops predicts it is poised to expand, not contract its share of advertising spending. In an update to its quarterly forecast, Publicis' ZenithOptimedia Group now estimates TV will capture a 38.2% share of global ad expenditures in 2008, up from 37.9% in 2007, and an all-time high.

"Television is, in fact, losing market share in many countries in North America and Western Europe," the agency notes, citing such reasons as those listed above, but noted that faster growth of ad markets in the rest of the world are counteracting those trends and are propelling TV advertising growth.

"In these markets television tends to attract a much higher share of ad expenditure," because they are more depending on the kind of big consumer goods marketing categories that rely on the mass medium to introduce new products and brands and to maintain their awareness.

"We expect the coverage of the Olympics in Beijing to give an extra boost to television in 2008, particularly in China and its neighbors," the agency noted. "We forecast television's share to grow by 0.5 percentage points to 41.3% in China, by 0.3 points to 42.5% in Asia Pacific, and by 0.3 points to 38.2% across the world. In the absence of this stimulus, its share will fall back to 38.1%, but this is as high as its previous peak, in 2004."

Much of TV's advertising growth is coming at the expense of other traditional media, especially newspapers, which are also being impacted by the budget shifts to the Internet.

By contrast, ZenithOptimedia said, "outdoor is in rude health, and is forecast to increase its market share from 5.6% to 5.9% over the same period. New digital displays make it easy for advertisers to book and distribute eye-catching ads at short notice."

In the U.S. TV advertising share is expected to erode amid a relatively tepid domestic advertising economy.

"The continued slump in the U.S. housing market has led to a sharp drop in property and construction, advertising, particularly property classifieds in newspapers. This, and the recent credit squeeze, has led us to downgrade our forecast for growth in the US this year from 3.3% to 2.5%," the agency predicted.