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Deborah D. McAdams / 01.17.2012 12:00AM
Local TV Defies Sector Lag in 2011
CHANTILLY, VA.: TV stations defied a
trend of publicly held local media companies performing worse last year than
the overall stock market. All local media stocks in BIA/Kelsey’s
Local Media Index fell 18.7 percent, while local TV station stocks were up 6.1
percent.
BIA/Kelsey said its analysts found a “shift toward growth in digital
revenues” within an overall “flat local advertising
economy.”
Subsectors such as
Yellow Pages, down 77.5 percent, and newspapers, down 27.8 percent, brought the
overall LMI down. Positive elements included online advertising and search, up
8 percent; diversified media, up 7.8 percent, broadcast TV, up 6.1 percent; and
radio, up 2.1 percent.
The index demonstrates that local media values could be
“more volatile to the perceptions about the future of the economy and
local ad spending than the S&P itself,” according to Mark
Fratrik, the firm’s vice president. “Last year’s
poor performance of the LMI was caused by deep concerns over the health of the
global economy in Q3 and the belief that businesses would severely cut back on
their advertising spending. While the last quarter of 2011 saw a rebound in media
stocks, the drop-off had been too significant to overcome.”
The chart at left tracks local media stocks vs. the S&P
500
BIA/Kelsey sees the prospects for local media companies improving along with
the economy in 2012. The anticipated strong political advertising year and the
outlook for radio and television stations should bolster several sectors in the
LMI.
With the maturity of digital technologies driving the delivery of content across
multiple platforms, advertising opportunities are significantly increasing, and
local media firms are starting to book incremental sales. According to
BIA/Kelsey’s forecast, by 2015, around 25 percent of all ad dollars
spent in local media will be in digital media.
Increasingly, this will occur in coordinated cross-platform media buying with
integrated creative and marketing campaigns.
LMI tracks the local media sector, with a market capitalization of $2.2
trillion.
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Thursday 12:00AM
Broadcasters File Suit Against FCC’s Political File Rules
“The FCC decision to put the political files online will bring broadcasters into the 21st century, and will make already public information more easily accessible to everyone.” Free Press Senior Policy Counsel Corie Wright.