TV station sales took a nosedive in 2008 compared to previous years, according to BIA Analyst Mark Fratrik, Ph.D. A total of 54 TV stations sold for $900 million last year, compared to sales of 232 stations for $4.6 billion in ’07. Radio was likewise hit; 778 stations sold for $856 million, down 27 and 51 percent respectively.
Fratrik allowed that the results were none too surprising, given that banks were somewhat preoccupied last year. While credit markets dried up on one side of the TV transaction equation, revenues diminished on the other as car companies threatened to go the way of the Raphus cucullatus (seen here, right).
“The outlook for the immediate future in those advertising revenues is not expected to recover,” Fratrik said. “It probably will not be until the later part of 2009 that advertising revenue growth becomes positive, and even then the growth will be slow.”
Many industry analysts agree that 2009 will be a wash, for the most part. Any signs of recovery aren’t expected until late in the year, going into next year. Consequently, very few stations are likely to move in ’09, Fratrik said.
“Sellers who want to exit the industry, in part or totally, see the limited number of buyers and will wait until conditions improve. The only action that may occur is through the disposition of assets that are part of bankruptcy proceedings,” he stated. “Even then, the owners of these assets will try to hold out for as long as possible, hoping for greater demand for these properties.”
Fratrik advises broadcasters ride it out, wait for the market to improve, and build value into their stations in the meantime through multiplatform utilization.
“By the time we get past the downturn, those investments will make the broadcast stations more competitive in local media markets,” he said, “thereby increasing their revenues and ultimately their values.
