Media agency Magna sees 2018 as a year in which U.S. ad revenues will reach an all-time high, surpassing $200 billion, despite a drop in television spending.
In its latest forecast, Magna sees national TV ad spending falling 2% to $41.9 billion from $42.3 billion in 2017 and a peak of $43.3 billion in 2016.
TV ad revenue will continue to slide, according to Magna, declining another 2.3% to $41.3 billion in 2019 and falling to $36.6 billion by 2023.
“A significant level of CPM [price] inflation for national Television . . . won’t be enough to offset the double-digit ratings declines on a typical year,” Magna said in the report.
The agency pegs price increases for adults 18 to 49 in prime time on English speaking broadcast at 11% for calendar year 2019.
English-language broadcast TV revenue is expected to be down 2% in 2018 and 2.3% in 2019. A drop of .04% if forecast for cable in 2018 followed by a 0.6% drop in 2019 and Spanish language TV is seen falling 4% in 2018 and dropping another 6.7% in 2019. Syndication is seen rising 1.8% in 2018, but dropping 3.1% in 2019.
Magna sees ad revenue for local TV in the U.S., excluding political spending during the mid-term elections, dropping 4.4% in 2018 and 4.5% in 2019.
Broadcast stations will be down 6.1% in 2018 and 6.5% in 2019. Local cable is expected to rise 0.9% in 2018 and 1.1% in 2019.
Magna said weakness of automakers was a big problem for local TV.
The agency forecasts political spending for the mid-terms at $2.9 billion, up 19% from four years ago. Including that spending, local TV revenue will be up 9.1%.
In the overall ad market, Magna sees U.S. advertising rising 6.9% in 2018.
Digital ad revenue will pass $100 billion and account for 51.5% of total U.S. advertising, topping the one-half mark for the first time.
Mobile digital advertising is expected to grow by 30% this year to about $70 billion--more than TV and twice as much as desktop based revenues.