BIA/Kelsey: Local TV Strong But Not Untouchable

Despite the onslaught of competitors sparking concerns about the medium’s future, local TV continues to hold its own with both audiences and advertisers, a BIA/Kelsey report released Wednesday shows.

Among the findings in the report, Local Television Stations: Maintaining an Important Presence in 2016 & Beyond, is that local advertisers still favor local TV, spending 15%, or $21.9 billion, of their ad dollars on the medium. Only direct mail – which gets 25%, or $36.9 billion of local ad spends – gets more, the study found.

A 12% increase in ads from political this year, increased retransmission revenue and the benefits of recent M&A activity are also boosting the industry.

As viewing habits shift, however, maintaining that position is not a guarantee, the report finds.

While live TV still garners 90% of video viewing, that number is down from the 96% it had in 2011.

“This position is not without challenges, both immediate and long term,” the report says. “While some television groups will successfully respond to those challenges others will not.”

Digital advertising is expected to make up 40% of the local media marketplace by 2020, making TV stations’ investment in the arena crucial, the report says.

At the same time, the growing number of outlets offering video advertising are expected to increase their share of that revenue stream, the report says.

“While (TV stations) continue to generate substantial revenue gains especially during the political and Olympic years, they face a growing array of new competitive advertising media and viewing options available to consumers,” the report says.

More information about the 67-page report is available here.

(Photo via Pictures of Money's FlickrImage taken on Sept. 17, 2015 and used per Creative Commons 2.0 license. The photo was cropped to fit 3x4 aspect ratio.)