October Radio Revenue Was Up, Though Comps Were Soft

Radio revenue jumped 6 percent in October compared to a year ago, RAB reported.
“Don’t get too excited,” writes analyst Marci L. Ryvicker of Wachovia Capital Markets. She says the industry benefited from “easy comps,” or comparisons, to a soft month a year ago.
For the first 10 months of 2006, overall revenue for the U.S. commercial radio industry is flat, according to RAB.
In October, grand total combined spot and non-spot radio revenue increased 6 percent. National business was up 14 percent, while local sales (the bulk of the industry’s revenue) was up 2 percent. Non-spot grew 15 percent in October.
“The 6% growth that October generated in 2006 does not even bring the radio industry on par with 2004’s absolute dollar amount; in fact, it is still below 2004 by 100 (basis points),” Ryvicker wrote.
“Looking at each segment separately, national revenue declined 19% in October 2005. If we take this year’s 14% gain, the industry is still 5% below where it was in 2004. Local declined 2% in October 2005. If we take this year’s 2% growth, local is flat with 2004.
“The only category that is experiencing organic strength is non-spot revenue, which was down 8% in 2005 but up 15% in 2006. This is not surprising given both advertisers’ and radio groups’ focus on the Internet,” she stated.