Local Television Revenue Expected to Reach Over $20 Billion in 2014

BIA/Kelsey, adviser to companies in the local media industry, forecasts the local television advertising market will grow by nearly eight percent in 2014, after dipping in 2013.

According to its first edition of the quarterly Investing In Television Market Report, the firm reports that in 2013 the industry earned $700 million in online revenues and $18.4 billion in over-the-air revenues, an 8.5 percent drop from 2012, which was an exceptional year for political advertising. For 2014, BIA/Kelsey anticipates combined local TV revenues (over-the-air and digital) to reach $20.7 billion in 2014.

“This year there will be a significant uptick in ad revenues driven by political ads in hotly contested states,” said Mark Fratrik, senior vice president and chief economist, BIA/Kelsey. “Additionally, we're seeing the ability of local stations to maintain their loyal advertiser base, which means they consistently receive recurring ad revenue that boosts their profitability."

Despite its current position, the television industry is experiencing competition from video media solutions. Over the next five years, for instance, online video will experience a strong annual growth rate of 31.5 percent and out-of-home video will grow 9.2 percent. As a result of these changes, local television’s share of local video in 2018 will decrease from 67.5% in 2013 to 59.4% in 2018, even with the higher total revenues shown above ($22.1 billion in over the air revenues).