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The Revenue Outlook May Be Down — But Not Everywhere

Look for smaller markets to outpace the big boys for awhile, BIAfn says.

If you’re going to run a business in radio these days, it seems the smaller markets are the places to be.

The dollars are fewer, of course; still, much of the good news coming out of radio’s business side of late has been from outside the big cities.

The latest numbers along those lines come from BIA Financial Network, which reports that while large radio markets “continue to struggle,” small and medium-sized cities are showing minor gains in revenue and a better outlook than their top-10 peers.

The firm issued its quarterly “Investing in Radio Market Report.” It said markets 11th and higher “will see better revenue growth quicker from the slump in the industry due to local advertising support, differences in competition and their audience’s embrace of technological improvements.”

The company thinks small and mid-sized markets will reach radio revenue levels equivalent to those of last year by 2011.

“This time frame is two-three years before large markets such as New York, Los Angeles and Chicago will rebound to that level.”

It named markets where it expects to see increases including McAllen-Brownsville, Texas (2.8 percent), El Paso, Texas (3.8 percent), Madison, Wis. (1 percent), and Baton Rouge, La. (3 percent).

“Advertisers in these smaller regions continue to find radio to be an effective medium to reach consumers,” said stated BIA’s Mark Fratrik. He also thinks listeners are “beginning to respond favorably to the digital innovations their favorite stations are making through multicasting and live audio streaming, enhanced Web sites and HD Radio.”

But he also doesn’t expect radio operators to return to double-digit growth anytime soon.