BIA Advisory

It’s another revised spending forecast, courtesy of COVID-19.

This time it’s from BIA Advisory Services, which is lowering its 2020 outlook for U.S. local television advertising. Its new estimate in early Q2 of $18.5 billion is down from $19.4 billion forecast earlier this year. That breakdown includes $17 billion for over-the-air revenue and $1.5 for digital.

Overall, BIA says, the latest figures still reflect election-year spending and represent a slight increase over 2019.

“Local television stations, like all media, will see significant decreases in advertising from many business verticals like travel, leisure and retail,” said Mark Fratrik, Senior VP and Chief Economist at BIA Advisory Services. “Political advertising will buffer those decreases in many markets that have competitive Senatorial and Gubernatorial races and in Presidential battleground states. Plus, continued growth in OTT and digital will help to soften the impact of the pandemic on advertising revenue.”

BIA’s analysis finds political, OTT and digital represent the safest categories right now for local television in the current advertising marketplace. BIA projects that $7.1 billion will be spent on political through Q4 2020 — with OTA getting 45.8% of the action.

The outlook also reflects $10.44 billion in retransmission consent agreements this year. BIA predicts those fees will keep rising, mostly due to rate increases in each market.

Says Fratrik: “Since we completed this forecast in early April, over 25 million Americans have filed for unemployment insurance and there is continuing economic concerns as the country moves to open back up. We expect political advertising will increase very quickly, and we anticipate certain verticals will rebound more quickly than others. It is going to be a dynamic marketplace this year, and we will continually monitor the nationwide and local economies to update our forecast based on new information.”