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Radio Stations See Online Growth Increasing at Faster Pace, as Industry Revenues Rose Slightly in 2012

Strong political season and general economic picture brought some markets noticeably higher income; value of radio in the media buy remains apparent

CHANTILLY, Va. (March 27, 2013) – Radio industry over-the-air revenues inched slightly upwards in 2012, increasing to $14.3 billion, a 1.5 percent change from the year before, according to the first edition of “Investing In Radio® Market Report,” a quarterly report published by BIA/Kelsey, adviser to companies in the local media industry. That slight change is due in large part to the sluggish overall economy for 2012 and the increased competition radio faces in the local media market. The company also notes that station revenue mix will continue to shift somewhat and income from online advertising is expected to rise at a rate of about 10.8 percent annually over the next five years versus 2.5 percent from over-the-air.

For 2013, BIA/Kelsey forecasts over-the-air radio revenues should see 2.3 percent growth, or $14.7 billion, again due to the slightly stronger economy.

In 2012, online radio ad revenues reached $491 million, representing 3.3 percent for the industry. Markets such as Boston saw 14.2 percent in online radio revenue with overall numbers rising by 3.6 percent. BIA/Kelsey forecasts radio’s online revenue growth will reach $818 million by 2017, while the industry’s combined total revenue will reach $17 billion by 2017.

“As the digital marketplace continues to rise in all sectors of advertising, radio is improving its listener engagement online and benefitting from the value of its web and mobile assets,” said Mark Fratrik, vice president and chief economist, BIA/Kelsey. “Overall, the industry is still recognized as an important part of the media mix as it continues to meander around, rising slightly with the rate of inflation but not keeping up with the economy.”

The chart below represents BIA/Kelsey’s historical and five-year forecast for the radio industry broken down by over-the-air and online:

Investing In Radio Publications

A complete profile of every Arbitron-rated market with historic and projected demographic and financial statistics is available in the first edition of the quarterly “Investing In Radio® Market Report,” which is now available for purchase. It also includes station competitive and performance information including 12+ total day Arbitron ratings for the past eight ratings periods, BIA/Kelsey’s estimated advertising revenues, technical data, ownership and acquisition information, and much more for every market.

The publication is part of the “Investing In” financial guide series that provides estimated forecasts for over-the-air and individual market-level online advertising revenues, technical data, ownership and acquisition information, and more for every market that can be found on the company’s website.

BIA/Kelsey’s forecast methodology is based on actual estimates of local online market advertising revenue totals. Estimates are solicited from local radio stations and knowledgeable local market experts. To provide an accurate review of the advertising marketplace, the model does not include revenues of e-commerce sales through daily or weekly deal campaigns or any retransmission consent.

BIA/Kelsey also publishes investment reference guides and provides data services for the television and newspaper industries. For more information, call (800) 331-5086 or email info@biakelsey.com.

About BIA/Kelsey

BIA/Kelsey advises companies in the local media space through consulting and valuation services, research and forecasts, Custom Advisory Services and conferences. Since 1983 BIA/Kelsey has been a resource to the media, mobile advertising, telecommunications, Yellow Pages and electronic directory markets, as well as to government agencies, law firms and investment companies looking to understand trends and revenue drivers. BIA/Kelsey’s annual conferences draw executives from across industries seeking expert guidance on how companies are finding innovative ways to grow. Additional information is available at https://www.bia.com, on the company’s Local Media Watch blog, Twitter (http://twitter.com/BIAKelsey) and Facebook (http://www.facebook.com/biakelsey). Stay connected by subscribing to the firm’s bi-monthly newsletter.

For more information contact:

MacKenzie Lovings
BIA/Kelsey
(703) 818-2425
mlovings@biakelsey.com

Eileen Pacheco
For BIA/Kelsey
(508) 888-7478
eileen@tango-group.com

Robert Udowitz
For BIA/Kelsey
(703) 621-8060
rudowitz@biakelsey.com

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