TVB May Re-Revise 2009 Forecast
Outlook appears worse as auto continues to sputter and stall
By Michael Malone -- Broadcasting & Cable, 2/2/2009 2:00:00 AM
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NOTES OF OPTIMISM
Related: COVER STORY: Digging for Dollars
In November, the Television Bureau of Advertising (TVB) took the unique step of revising its initial 2009 forecast to reflect the gloomy state of the business landscape. Now, the trade organization is considering the unprecedented step of re-issuing its forecast again (see cover story, p. 8).
“It looks worse,” says TVB President Chris Rohrs. “The outlook has deteriorated somewhat from [November].”
The initial forecast in September called for local spot to essentially stay flat, and national spot to drop 7%-11%. The revision in November predicted a 4%-8% drop in local, and a national spot decrease of 12%-16%. (The only other time the TVB had revised a forecast was when its 2002 forecast landed six days before the attacks of Sept. 11.)
Rohrs fears the newer numbers may not accurately depict just how harsh the 2009 business environment is for television. “I don't think you'll find too many broadcasters who think [the November forecast] will be the case this year,” he says. “We may, in fact, look at it again.”
Rohrs, who represents some 600 stations at TVB, cites automotive as the chief culprit, as the beleaguered Detroit manufacturers continue to withhold their advertising windfall. In its quarterly earnings released late last week, Media General reported a 26% plummet in local time sales, and a 31% free fall in national time sales. “Lower automotive spending was the main factor for the decreases in both categories,” said the report.
Adds Rohrs: “The heart and soul of this is automotive. It's a pure reflection of the lockdown among consumers.”
NOTES OF OPTIMISM
He does hold out hope that President Obama's stimulus package will do what it's designed to do, and that auto sales will pick up in the first half of the year on the backs of new models from Chrysler. Other broadcasters hold a hint of optimism, too, saying business may just be down in the single digits this year, thanks to the stimulus package and the increasingly lucrative retransmission consent category.
“We think this year may turn out to be better than many people think,” says GrayTelevision President/COOBob Prather, who says that Gray will bag $13 million in retrans this year. “We're trying to hold our prices as much as possible. We'll be down some, just not as bad as people may think.”
Despite the woes, Rohrs says TV still holds the pole position in terms of a marketer's media options. “It's the only medium with the impact to match the size of the [economic] problem,” he says. “Advertisersstill have to put a good, creative message in front of the consumer.”
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