Media Spending Set to Pass $1 Trillion

LOS ANGELES Per capita consumer spending for media will breach the $1,000-per-year mark for the first time in the U.S. in 2009 as the communications industry marches along at a 6.7 percent annual growth rate, exceeding $1 trillion in 2008.

The data comes from the “Communications Industry Forecast” by Veronis Suhler Stevenson, which also predicts that in 2009 the average consumer will spend 10 hours per day with media, much of it DVDs and the Internet.

Advertising also should grow at a steady 6.1 percent this year and 6.8 percent through 2009 to $260.9 billion, “driven primarily by the migration of advertising dollars from traditional to new media,” according to the study.

The report, though, classifies as “new advertising media” such consumer staples as cable and satellite TV, along with such newer inventions as satellite radio and the Internet. The category also includes ads on movie screens and in video games, and it is poised to grow 20.7 percent this year to $37.9 billion, compared with traditional media advertising that will grow 3.2 percent this year.

Through 2009, new-media advertising will grow at an annual rate of 16.9 percent, while traditional media advertising grows at a rate of 4.3 percent. Together, advertising should grow at an annual rate of 6.8 percent through 2009, surpassing the 3 percent rate of growth achieved in the five years leading to 2004.

Even radio is expected to grow at a healthy clip “as the unprecedented expansion of satellite radio accentuates the relatively tempered growth of broadcast radio advertising.”

Specifically, terrestrial radio advertising will grow this year at a 2.7 percent clip, while celestial surges 112.8 percent. While Sirius Satellite Radio and XM Satellite Radio feature commercial-free music, their news, comedy, talk and sports offerings carry ads.

But while overall advertising grows, consumers will spend less of their media time with ad-based media and more of it on consumer-supported media. The latter stood at 36.4 percent in 1999 and will be at about 45.9 percent in 2009.

The report says ad-based media consists of broadcast television and radio, satellite radio, newspapers and magazines, while consumer-supported media are cable and satellite TV, film, home video, interactive TV, recorded music, video games, Internet and books.