NEW YORK—The media buying company Magna Global is predicting a 22.9% drop in U.S. local TV advertising in 2023 while national TV networks will see a 6.3% slump and the AVOD/OTT ad business will see dramatic growth of 31.6% in 2023.
The local TV declines come after a year when political advertising hit record levels in 2022.
The company’s annual global advertising forecasts reported that total video advertising in the U.S. grew 7.1% in 2022 to $87.9 billion, with long form video hitting $69.6 billion (up 5.9%), national TV networks sliding to $38.7 billion (down 4%), AVOD/OTT spiking to $6.8 billion (up 18.4%) and local TV growing to $24 billion (up 22.7%). Short form video advertising grew 11.9% to $18.3 billion.
In the new forecasts, Magna Global also reduced its overall projections for the U.S. ad market from its previous 5.8% growth forecast to 3.7%.
“After a strong start in 2022….advertising spending growth slowed significantly in the second half amidst global economic uncertainty” with the U.S. ad market up only 3% in the second if political advertising is excluded, Magna Global reported.
Globally, the report noted that television advertising “will suffer from continued erosion in linear viewing” but that the declines will be “mitigated by resilient pricing” with average CPM costs up 10% and “growing AVOD ad sales on broadcasters’ streaming platforms.”
