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‘Moderate’ Sales Growth Seen for U.S. Radio in 2012

BIA/Kelsey also says radio’s online/digital sector will average 13.4% growth over five years

BIA/Kelsey’s five-year forecast for the radio industry

“Marginal” is the adjective used to describe the 2011 increase in the U.S. commercial radio industry’s revenue, according to updated estimates from BIA/Kelsey. But the research company thinks next year will be at least a bit better.

It issued a new outlook for the next five years. Among findings: Radio will end the year with revenue of $14.1 billion, up 1.2% from last year. Digital/online revenue will increase 15%, to $479 million. Online/digital revenues will reach $758 million by 2015, a 13.4% compound annual growth rate.

VP Mark Fratrik calls 2011 “a year of nominal growth for the radio industry, as advertisers remain cautious about spending their ad dollars in this sluggish economy.” But he said the company’s numbers, including station transaction trends, underscore radio’s “continuing ability to effectively reach and monetize local audiences via its proven business model.” The number of station transactions was down a bit in its latest report, though the value of transactions increased.

Number and $ value of radio stations sold by region, January-October 2011

In its “Investing in Radio Market Report,” the company predicts radio revenues to grow 3.5% next year, driven by the elections and continued growth of the online/digital money.

It also said radio station sales departments are becoming more active in the “deals” sector.