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Broadcast Growth Projected

Jun 16, 2003  •  Post A Comment

Advertiser spending will continue to shift to broadcast from other media, next-generation technologies will create new businesses to offset aging platforms and broadband Internet access will stimulate consumer spending.
Those are some of the leading trends that will shape the growth of consumer and end-user spending on global and U.S. media through 2007, according to PricewaterhouseCoopers’ annual Global Entertainment & Media Outlook.
But even the relatively modest growth being forecast will not come without some transformation pains, the report states.
Spending by global consumers and end-users will increase to nearly $1 trillion in 2007 from $781 billion in 2002, growing by 5 percent compounded annually. That growth will be fueled by Internet access, video games, cable network license fees and filmed entertainment.
Later in the five-year period, some slower-growing segments will pick up the pace to achieve double-digit gains. For instance, in 2006 and 2007, video game growth will be boosted by next-generation consoles.
Cable network license fees, TV distribution and filmed entertainment also are expected to grow at mid- to high single-digit rates.
Advertising mostly will receive periodic boosts from major media events, such as the Olympics and elections in the United States in 2004 and 2006 and the World Cup. Global advertising will increase at a 4 percent compounded annual rate to $375 billion in 2007. Radio and broadcast and cable television will be the fastest-growing categories, the report states.
The United States, which is a $479 billion media and entertainment market representing 44 percent of global spending, will see total advertising spending grow at a 4.9 percent compounded annual rate to $189 billion in 2007. Of that broadcast and cable television advertising will grow at a compounded annual rate of 5.7 percent, behind radio, the Internet and out-of-home media, the report states.
The PWC report forecasts growth trends for 14 entertainment and media segments for the 2003 to 2007 period drawing on a variety of sources, including advertising agencies, trade associations and research firms such as Wilkofsky Gruen Associates. PWC develops models that quantify the impact on industry spending of various economic, technological, demographic, behavioral and competitive factors. The report provides a global view that contrasts growth of these industries in the United States to Western European countries, Eastern European countries, the Middle East and Africa, Asia and the Pacific, Latin America and Canada.