Revenue is declining as the industry adapts to the digital landscape
London, United Kingdom (PRWEB) February 26, 2013
During 2012-13, the Radio Broadcasting industry will generate an estimated £1.16 billion in revenue, which is a 2.9% fall on 2011-12 revenue levels. Over the past five years, industry revenue has fallen at a compound annual rate of 2.8%. The development of new technology has fragmented the media market. According to IBISWorld industry analyst Andrew Johnson, “rapid uptake of the internet has significantly increased the accessibility of content and added a new interactive platform for advertisers, who are the key source of revenue for commercial radio broadcasters”. As part of Digital Britain proposals, the UK government has targeted 50% of listening via digital platforms by 2015. The internet and digital audio broadcasting (DAB) technology signal the way through this transition, but neither have provided industry-wide success so far.
Alongside the technological advances, the economic downturn negatively affected both business profit and demand from advertisers, consequently commercial advertising revenue has fallen in the recession. In the face of worsened conditions, mergers in the industry have increased the concentration at the top of the market and forced smaller operators out the other end. As part of the consolidation, both enterprise and establishment numbers have fallen across the industry and cost cutting measures have contracted employment and wages. The Digital Economy Act 2010 has also reduced regulation in the industry to the benefit of smaller commercial stations.
Over the next five years, a recovery in the wider economy is expected to help the industry as advertising budgets expand in response to improved business profit. However, spending cuts at the British Broadcasting Corporation (BBC) will have a significant negative impact on industry revenue. Overall, revenue is expected to contract marginally over the five years to 2017-18. Johnson adds, “managing the transition to new technologies and making the most of the opportunities the internet provides will be crucial for commercial radio operators”. IBISWorld expects that the merger of Global Radio and GMG Radio will prompt further consolidation among the major players of the industry in the coming years.
The UK Radio Broadcasting industry has a high level of market share concentration, with the top four broadcasters expected to account for 84.2% of revenue in 2012-13. Over the past five years, the overall market share of the top four competitors has been increasing. Major companies include the BBC, Global Radio and Bauer Media.
For more information on the Radio Broadcasting industry, including latest industry trends, statistics, analysis and market share information, purchase the full report from IBISWorld, the nation’s largest publisher of industry research.
IBISWorld industry Report Key Topics
Participants in this industry broadcast and transmit radio programmes to the public, affiliates or subscribers. Broadcasts are transmitted via analogue or digital signals, the internet, or cable or satellite systems. However, operators in this industry do not produce, promote or distribute taped recordings of radio programmes.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalisation & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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