Clear Skies: Weather Forecasting Services in the US Industry Market Research Report Now Available from IBISWorld

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The Weather Forecasting Services industry is a mature industry. Consumers are always going to need weather forecasts to get dressed in the morning and some businesses regularly turn to weather forecasts as a proxy for demand. As such, industry demand is expected to continue experiencing the same relatively stable demand that characterized the past five years. Industry operators tend to benefit from an increase in natural disasters because more consumers and commercial enterprises tune into the services provided by weather forecasters during hurricanes, fires, floods, blizzards and more. Although weather is generally unpredictable, IBISWorld does not anticipate the number of natural disasters to repeat the high experienced in 2011. For these reasons, industry research firm IBISWorld has added a report on the Weather Forecasting Services industry to its growing industry report collection.

IBISWorld Market Research

IBISWorld Market Research

Mobile weather applications will continue to support demand and revenue

IBISWorld estimates that revenue for the Weather Forecasting Services industry will increase at an annualized rate of 0.4% to $510.2 million in the five years to 2012. In 2012, industry revenue is expected to decline 4.1% off the back of a spike in 2011 as a result of a large number of natural disasters that occurred—a trend that is not expected to be duplicated in 2012. “Industry operators receive a lot of traffic when natural disasters occur because the daily activities of consumers and businesses rely on the weather,” says IBISWorld industry analyst Kevin Culbert. “As such, dramatic weather events have a direct influence on how closely people pay attention to the weather.” In general, the industry benefits from relatively stable demand and its overall maturity.

Industry profit margins have improved marginally during the past five years as a greater proportion of weather forecasting is performed by computers rather than by human input. “Although humans are still needed to choose appropriate weather models, computers complete the majority of actual calculations,” says Culbert. The majority of companies in the Weather Forecasting Services industry get raw data from radars and satellites operated by the National Oceanic and Atmospheric Administration's National Weather Service (NWS). These observation stations are primarily located at airports and military bases and each state has a few stations. The NWS uses radar, which sends out radio waves that reflect off particles in the atmosphere, like raindrops or ice. A radar then measures the strength of the waves returning and how long the round-trip takes, which allows forecasters to see the location and intensity of precipitation. Currently, the NWS uses the Doppler radar, which also measures the frequency change in returning waves; this reports the direction and speed at which the precipitation is moving, which allows forecasters to see rotation occurring inside thunderstorms before tornadoes form.

The industry’s nature has led to market saturation because industry operators generally provide the same services. As such, the industry has started to consolidate as larger firms vie for market share and extend their reach through niche services. In the five years to 2012, the number of firms operating in the industry is expected to decline 1.5% per year on average to 199. The industry's consolidation was evidenced in the July 2012 announcement of The Weather Channel's plans to acquire former major player Weather Underground.

In the next five years, large industry operators will benefit from the continued adoption of smartphones and mobile weather applications, trends from the past five years. Although small players are not expected to experience as much growth as the industry’s leaders, they will still benefit from the necessity of weather forecasting for the general public. For more information, visit IBISWorld’s Weather Forecasting Services in the US industry report page.

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IBISWorld industry Report Key Topics

This industry provides forecasts of future weather activity for individuals, businesses and governmental organizations. These forecasts are then disseminated via TV, the internet and the radio.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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Gavin Smith
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