Radio Revenue Report

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Political Advertising Highlighted Radio's Third Quarter

According to the RAB third quarter Radio Revenue Report, the financial picture for Radio had some bright spots. Most notably, Off-Air continues its steady growth with increases from online and experiential marketing.

Revenue Comparisons - 2008 vs. 2007 ($ In Millions)
Revenue	$Q3 '08	% Chg	$YTD '08	% Chg
Local	$ 3,457	-10%	$ 10,435	-8%
National	$ 767	-12%	$ 2,195	-11%
Local & National Combined	$ 4,224	-11%	$12,630	-9%
Network	$ 285	-3%	$ 8,552	1%
Off-Air	$ 458	5%	$ 1,347	9%
Grand Total	$ 4,967	-9%	$14,829	-7%
Source: Miller, Kaplan, Arase & Co. Off-Air was previously referred to as Non-Spot

Though David Silverman, a partner at PricewaterhouseCoopers LLP, stated that "a weakening economy will continue to be a challenge for all forms of advertising-supported media," Jeff Haley, President and Chief Executive Officer, Radio Advertising Bureau, returned with "Although Radio companies are not immune to the current economic downturn, Radio's flexibility across traditional and emerging platforms provides advertisers multiple channels for consumer engagement... "

Network Radio saw some consistency with Wal-Mart taking the lead as the sector's top spending advertiser with nearly $42.7 million invested through Q3 ‘08. Most marketers curtailed spending across media, but radio did experience growth in certain key categories, particularly Insurance and Restaurants, in the Local and National sectors.

Radio's Local and National Combined Leading Growth Categories 2008 vs. 2007
Category	$Q3 '08 (in millions)	$Q3 '07 (in millions)	% Change	$YTD '08(in millions)	$YTD '07 (in millions)	% Change
Insurance Companies	$242.1	$208.7	16%	$734.6	$620.4	18%
Professional Services	$70.1	$72.0	-3%	$407.9	$366.8	11%
Beverages	$301.6	$293.1	3%	$799.3	$757.5	6%
Restaurants	$353.3	$343.1	3%	$1,171.9	$1,130.5	4%
Source: Miller, Kaplan, Arase & Co.: X-Ray Markets

The extended Political season for the 2008 Presidential race proved beneficial to Radio. In 35 key markets, campaigns on Local and National Radio carried some $20.6 million of messages in Q3. It moved the year-to-date tally to $54.9 million, which offset the drops among many of Radio's perennial leading spenders. In addition, Network Radio was endorsed by the political hype with $6.2 million in Q3 '08 and $13.8 million year-to-date according to TNS Media Intelligence.

In a comparison of Local and National Q3 and year-to-date '08 political spending in the Miller Kaplan markets to the last presidential election year of 2004, here's a recap of Political spending, from the report:

• Q3 '08 saw a 20.5% increase versus Q3 '04 (+$3.5 million)
• Year-to-date '08 tallied in a 43% increase over the same time period from '04 (+$16.6 million)
• In the Local and National sectors, Issue/527s won the quarter as the largest spender infusing more than $2.7 million dollars with year-to-date ending over $7.8M in the 35 Miller Kaplan reporting markets
• Various committees, associations and organizations followed with a $.7M and $2.2M investment in National and Local Radio's Q3 and year-to-date totals, respectively
• Candidate dollars, led by Barack Obama and followed by John McCain, collectively added $.2M to Q3 '08, closing out year-to-date at $1.2M

The bulk of all political funds was spent in the West region in Q3 '08 (42%) and year-to-date (47%). Political quarterly and year-to-date breakouts look like this:

Political Advertising Spending, 2008
Region	3Q 2008	YTD 2008
West	42%	47%
Central	23%	21%
East	18%	19%
South	11%	10%
Southwest	5%	3%
Source: Radio Advertising Bureau Q3 Report, November 2008

According to TNS, Q3 '08 Network Radio was supported by T. Boone Pickens' Plan ($1.4M), Obama for President ($1.0M), research and educational think tank, Heritage Foundation ($0.4M), along with Issue/527 and various organization spend.

Please visit here for more information about the RAB report.

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