Forecast: Slower go for broadcast in 2013

Broadcast ratings are down this season, which usually creates a higher demand for scarce inventory, increasing prices for advertisers.

But that doesn’t appear to be the case this year. Demand is actually down.

As a result,  broadcast ad spending will see smaller than expected gains in 2013, in an unusual development that could signal a new long-term trend as people’s attention increasingly moves from old to new media.

A new ad spending forecast from Magna Global forecasts 2.1 percent growth in broadcast TV ad dollars for the coming year, down from the agency’s October prediction of 4.8 percent growth for 2013.

Because of low demand, scatter prices are nearly even to the prices paid during the upfront, notes the report.

“Since the beginning of the broadcast season in September, the scatter market prices have showed very little premium over the upfront CPM inflation despite the fact that primetime ratings have been weaker than expected (-5 percent for broadcast networks in adults 18-49, including sports),” says the Magna forecast.

“That unusual pattern reveals weak demand.”

Media buyers have lamented the lack of new hit shows this season, with only NBC’s “Revolution” and the CW’s “Arrow” showing breakout potential.

Fox’s “The Following” got a good start Monday but it’s still too early to gauge whether its ratings will hold up.

And ratings for returning shows were largely down last fall, including notable declines for hits such as “Two and a Half Men,” “Dancing with the Stars” and “New Girl.”

The declines have been blamed on poor programming, increased DVR usage and the infringement of new media devices such as tablets and smartphones on traditional TV viewing.

“As a result, national broadcast revenues (excluding political and Olympics) were down by -5.5 percent  in the second half of 2012 and we expect a similar softness throughout the first part of 2013,” says Magna’s report.

Cable, on the other hand, will benefit from broadcast’s struggle, with some of the ratings declines for broadcast due to gains for cable.

Programs like AMC’s “The Walking Dead,” which was television’s No. 1 drama among adults 18-49 last fall, History’s “Hatfields & McCoys” and MTV’s “Jersey Shore” drew ratings comparable to broadcast last year, and Magna believes that growth will continue in the coming year.

“National cable will continue to benefit from better ratings and gain market share from broadcast: revenues will thus grow +4.0 percent,” the forecast predicts.

Local TV got a big infusion of political and Olympic spending last year. But excluding those comparisons, the medium still will grow at a decent pace, 1.4 percent.

Overall advertising, including print and online, will be up 2.7 percent excluding political and Olympics, compared to a forecast of 2.8 percent growth in October.

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