Global TV ad revenues to be $123 bn - Informa

Televisionpoint.com Correspondent | London
Global net advertising revenue for television will grow almost 6 percent in 2008 to $123 billion despite concerns of an economic slowdown, according to a report by industry analysts Informa Telecoms & Media.

News Corp Chief Executive Rupert Murdoch said on Monday he had become more pessimistic in the past month about the U.S. economy, as an advertising slowdown hit local TV and newspaper markets. But other media executives have seen brighter outlooks.

Informa predicted the hype around the Beijing Olympics in August would help global ad revenue grow 5.8 percent in 2008, against 3.5 percent in 2007.

Of the $123 billion expected to be spent on advertising, 15 percent, or $18 billion, will come from the pay TV ad market. That is expected to grow to 17 percent, or $25 billion, by 2012.

TV groups have been hit in recent years by ad money moving to the Internet, and analysts have been keen to see if there has been a slowdown due to the tough economic conditions. The predictions are for net advertising revenue, and have removed agency commissions, production costs and discounts.

"Informa believes this is the first time that TV advertising forecasts for this many countries (44) have been homogenised and reflect only the revenue received by the channels and networks," the report's author Simon Murray said.

"It is easy to forget just how large a market TV advertising is. Pay TV, albeit a new sector in many countries, only accounts for 15 percent. It is only expected to grow to 17 percent of the 2012 total, even though it will increase by $7 billion."

The report, Global Net TV Advertising Forecasts, said the UK would boast the highest proportion of pay TV advertising, at about a third in 2008, with Korea and Canada next on 30 percent.

The North American market has the largest share of the total pay TV advertising market, at 62 percent, but this is expected to fall as other regions gain.