Kagan Sees 1.8% Radio Growth This Year

The U.S. commercial radio industry could bring in about $25 billion a year by 2011, according to Kagan Research.
The company thinks revenue will be up slightly, by about 1.8%, this year but “more stability is expected in outer years as the growth pattern levels off to 3% – 4%.” It released the data in conjunction with its Radio Financial Databook.
The company feels that despite stock prices, “The fundamentals of the radio industry remain strong and new technologies are helping the sector reinvent itself.”
Among its findings:
During 2005, broadcasters began to report revenue streams of 2% to 3% being generated from their Web sites; local online radio revenue grew to a reported $200 million. Kagan expects online to be one of the fastest-growing revenue segments for radio.
“Additionally, broadcasters reported increases in the yield per advertising minute and Clear Channel Radio reported a Q1 earnings increase of 5%, suggesting that its strategy to reduce commercial interruptions is starting to bear fruit.”
The radio deal volume increased for the second straight year in 2005, topping $4 billion, driven by Cumulus’ purchase of Susquehanna and the merger of Lincoln National and Jefferson Pilot.