PwC Report: Radio, Out-Of-Home Ad Segment To Reach $89B In 2011
June 21, 2007 at 2:00 PM (PT)
The global entertainment & media (E&M) industry is experiencing sustained growth and will increase at a 6.4% compound annual growth rate (CAGR) to $2 trillion in 2011, according to PRICEWATERHOUSECOOPERS' "Global Entertainment and Media Outlook 2007-2011," released today. The U.S. remains the largest but slowest growing E&M market, growing at a 5.3% compound annual growth rate, reaching $754 billion in 2011.
According to the report, the radio and out-of-home market rose 4.5% in 2006, down from the 5.2% annual gains during 2004-05, although an improvement compared with the 2.7% annual gains during 2002-03. Out-of-home was the faster-growing component with a 6.3% increase, while radio rose by only 3.6%. Out-of-home will be fueled by digital billboards. Improved out-of-home audience measurement systems will attract advertisers, and the expansion of captive video networks will also fuel growth. Globally, the radio and out-of-home advertising segment is expected to increase from $69 billion in 2006 to $89 billion in 2011, a 5.2% CAGR.
The radio and out-of-home market rose 4.5% in 2006, down from the 5.2% annual gains during 2004-05, although an improvement compared with the 2.7% annual gains during 2002-03.
Double-digit growth is expected for digital and mobile spending in each territory during the next five years, rising to $153 billion by 2011. Spending related to the distribution of entertainment and media on convergent platforms (convergence of the home computer, wireless handset and television) is also growing at double-digit rates and will exceed 50% of global spending by 2011. Within the next five years, nearly half of the total industry growth is expected to be generated through online and wireless technologies and, during the same period, broadband households will grow by 300 million to 540 million subscribers and wireless subscribers will increase by 1.1 billion to 3.4 billion. The migration to digital formats is having an adverse impact on competing revenue streams while consumer-generated media is accelerating content fragmentation, the report says.
Global advertising will increase at a 5.4% CAGR during the forecast period, rising to $531 billion in 2011 from $407 billion in 2006. Internet will remain the fastest-growing advertising medium, with a projected 18.3% compound annual increase to $73 billion in 2011. Advertising on the Internet has truly come of age and by 2011 will comprise 14% of the global advertising market. Out-of-home will be the second fastest growing advertising medium, with a projected 6.5% compound annual increase.