’05 Prediction: Satellite Radio Ad Growth 112.8%, Broadcast Radio 2.7%

The average person is expected to spend 10 hours a day with media by 2009, with the greatest hourly gains to go to home video, consumer Internet and wireless content and interactive television. Those gains will drive consumer spending on media over the $1 trillion threshold for the first time. Those are conclusions reached in a Veronis Suhler Stevenson communications industry report.
EVP Jim Rutherfurd states that during the last five years, the investment firm has seen a shift away from ad-based to consumer-supported media, and a transfer of spending from traditional to new media.
Veronis Suhler predicts growth in total communications spending to be 6.8% for 2005, reaching $857.59 billion. Of that, the firm expects new media advertising to grow 20.7%, reaching $68.62 billion by 2009, compared to 4.2% for traditional media at approximately $192.28 billion.
Spending on new advertising media, such as cable and satellite television, satellite radio, e-media, consumer Internet movie screen advertising and videogame advertising grew 21.7% in 2004 to $31.37 billion, and is forecast to grow 20.7% in 2005 to $37.86 billion.
The firm projects spending for broadcast and satellite radio, including broadcast advertising, satellite subscriptions and satellite advertising, to rise 4.6% this year, as the 2.7% growth in broadcast advertising expenditures is augmented by 132.4% growth in satellite radio subscriptions and 112.8% growth in satellite radio advertising. Total satellite radio spending will rise 131.8% to $680 million this year.
Total broadcast and satellite radio spending combined is forecast to grow at a compound annual rate of 6.2% from 2004 to 2009, reaching $27.45 billion in 2009, “as the unprecedented expansion of satellite radio accentuates the relatively tempered growth of broadcast radio advertising,” states Veronis Suhler.