Unexpected Gains in Cable and Spanish-Language TV Cited

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NEW YORK ( -- Citing surprising gains made by some media, including cable, syndicated and Spanish-language TV, analysis firm TNS Media Intelligence/CMR
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boosted its full-year forecast for U.S. ad revenue growth.

Morning release
The new findings were released at this morning's "AdWatch: Outlook 2003" conference at the Grand Hyatt New York. Advertising Age, and TNS Media Intelligence/CMR are sponsors of the event.

In January, CMR had predicted ad spending for 2003 would rise 3.3% from 2002, to $117.5 billion. The company now puts that figure at $124.7 billion, an increase of 4.3% from a year ago.

'Better than expected'
"Things were better than we expected," Steven Fredericks, CMR's president-CEO, told Spanish-language TV showed the strongest performance, allowing CMR to boost that medium's growth estimate to 16.9% from 9.2%. Syndicated TV bettered its previously forecast increase by almost fourfold, with CMR estimating its growth to be 9.6% instead of the previously predicted 2.5%.

Cable networks' growth forecast increased to 7.2% from 4.8%, reflecting, in part, what Mr. Fredericks said was a quick "snapback" from war-related revenue declines. In fact, CMR data show that the Iraq war had "no impact" that persisted on total TV ad spending. The data showed that the initial fall-off of TV advertising owing to the war was around $70 million -- compared with a loss of $313 million that happened in the wake of Sept. 11.

The only ad categories now forecast to turn in weaker performances than had been thought in January are spot TV (1.8% vs. 1.9% in January), national and local newspapers (2.1% vs. 2.6%) and outdoor (3.3% vs. 3.4%).

Turnaround for 2004
Mr. Fredericks said that what the data shows is a broader economic turnaround in 2004 is now more likely. "We see advertising as a leading indicator," he said. "Even in the second half of this year, our estimates are increasing." In January, CMR forecasted ad growth to fall off to 2.1% in, but the revised forecast posits 4% growth.

In other key categories, the revised forecast doubles the previous growth estimate for consumer and Sunday magazines to 5.4% from 2.7%; keeps Internet advertising and business-to-business magazines steady at 7.4% and 3.6%, respectively; rises radio to 4.9% from 3.8%; and tick up network TV one-tenth of a percent to 2.8%.

Mr. Fredericks attributed his firm's caution on 2003 forecasts, which lagged most other estimates, to the torrid growth recorded in the last quarter of '02, in which ad spending rose 14%. He said the firm arrived at its new numbers after reviewing the performance of this year's TV ad selling season, known as the upfront, and revised gross domestic product data.

Other forecast
Not all forecasters share CMR's bullishness. Robert Coen, senior vice president and director of forecasting at Interpublic Group of Cos.' Universal McCann, New York, last week lowered his U.S. ad spending increase to 4.6%, after having predicted a 5% increase last December.

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