Streaming Video to Aid Local TV Sites

Stations to Rely More on Web Business

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Local-media research firm Borrell Associates predicts that Web sites for local television stations will be their "financial saviors," in a report released this week.

"Some of them now generate millions in revenue and significant profits, and have high potential for continued growth," the report said. "Another strong indication of the fundamental changes taking place in the media industry: Local Web sites generate important value for their owners, especially for owners that have positioned their sites for growth in key high-demand advertising categories such as e-mail, streaming video and paid search. Some of these local Web sites are worth between $300 million and $450 million, and even small sites are seeing values in the low millions of dollars."

TV Web sites are among the local media properties best positioned for future growth, Borrell said. In fact, local TV stations will take in $1.2 billion in revenue from their Web sites this year, up from $770 million last year.

In addition, local radio and TV companies generate about 3% of their revenues today from digital sales; that number will jump to 5%-6% in 2011.

Online video ads will contribute to that growth. Today, streaming audio and video ads accounts for 19% of local online revenue and will rise to 59% in 2013, Borrell said.
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