Olympics to delay soft ad year

Market otherwise poised for recession

The U.S TV ad market marked is poised for a recession, but the anticipated downturn will in the short-term be off set by the Beijing Olympics, the European soccer championship and the U.S. elections.

U.S. marketing budgets will be pressed harder than those in Europe, according to a forecast by entertainment consultancy Screen Digest, which predicts 2009 will be a tough year for broadcast ad revenues.

Said Screen Digest senior analyst Vincent Letang: “Although we’re not expecting advertising budgets to be affected this year, thanks to quadrennial events, Screen Digest believes we’ll experience the real impact in 2009, which will be the toughest year for advertising revenues.”

In the U.S. annual growth of 1.5% is forecast for this year compared with 1.9% in Europe. By 2009 Screen Digest predicts a fall of 2% in the U.S. TV ad market, the first year of negative growth since 2001.

Overall the main Europe markets of Blighty, Germany, France, Italy and Spain are expected to grow by around 1.5% in 2009. However, in France TV ad revenues could go into reverse.

Boosted by digital channels the market is expected to pick-up on both sides of the Atlantic by 2010-12. But the rebound is unlikely to be as strong as it was the early 2000s following the dot-com crash — and only online revenue will post real net growth.

Screen Digest also predicts that European pay TV revenues will overtake those generated by advertising in 2009, three years later than happened in the U.S.

As for spend on programs, the forecast is for sluggish growth in the five main European markets, where leading broadcasters have generally maintained their program budgets despite losing audiences in a rapidly fragmenting market.

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