Who’s in worse shape: The radio business, which is turning in month after month of putrid performance? Or the analysts who track the business, but keep underestimating the speed of its decline? Mediapost:
Radio revenues probably dropped 7% in June compared to the same month last year, according to veteran radio analyst Jim Boyle of CL King and Associates–delivering a heavy blow to the industry in what is traditionally the second-biggest month of the year in terms of revenue.
The report follows an 8% decline in May, traditionally the biggest month. The decline also exceeds Wall Street’s forecast of a 4% decline.
In fact, radio has underperformed Wall Street’s negative predictions in nine of the last 12 months–in most cases turning in a percentage drop at least double that forecast by analysts and investors.
What is Wall Street missing here? We don’t think radio is going to disappear completely, but there’s an obvious set of converging trends here: Stale product that hasn’t seen innovation in years now facing a host of competitors (iPod, Internet, Satellite, in-car DVD players, etc), plus an overall shift from traditional media to digital. Hard to see how that’s going to add up to anything but steady decline for years to come.