MagnaGlobal Revises 2012 Ad Forecast Down Almost 2%

Revises Forcast

MAGNAGLOBAL has released its updated "U.S. Media Owners Advertising Revenue Forecast," with the 2011 forecast unchanged at 1.6% growth, including the impact of political and Olympics advertising. MAGNAGLOBAL still expects media suppliers to generate $173.5 billion of advertising revenues in 2011. Due to persistent weakness in the U.S. economy, however, MAGNAGLOBAL has revised its 2012 growth forecast down from 4.8% to 2.9%.

A slowdown in real personal consumption expenditures, manufacturing activity and ongoing problems in the labor and housing markets all contribute to the revised outlook. Its estimates are further impacted by continued disinflation.

The forecasts encompass core media categories including radio, television, Internet, print and outdoor, as well as direct marketing categories (direct mail, directories). Excluding direct marketing components, the revenue growth of core media categories is estimated at 2.9% in 2011 and 4.3% in 2012.

Under the current expectations of a slow-but-positive economic recovery in 2012, media suppliers' advertising revenues will continue to recover from the severe recession of 2008-2009. MAGNAGLOBAL expects revenues to reach $178.5 billion in 2012, which is still significantly less than the pre-recession level of 2007 ($206.1 billion).

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