From Anchorage to Atlanta and Des Moines to Denver, voters are being pummeled by political advertising in states with competitive races for Congress and governorships. They break up Wheel of Fortune and punctuate the nightly local news. The airwaves are so packed in Des Moines that WHO decided to add another hour-long newscast — not because there’s a ton of news in Des Moines, but because it knew it could sell the time. At rates that can easily top $1,000 a minute, it’s a gold rush that ends abruptly Nov. 4.
Two constants have kept Boston a healthy media market in 2013: sports and politics. While most of the country took a break from politics following last year’s presidential election, Boston did not. Massachusetts held a special election for a U.S. Senate seat on June 25, and the run-up to that election drove TV ad spending in Boston during the first half of the year.
The unprecedented deluge of campaign commercials on local television left a massive cash windfall in its wake. Political groups spent more than $27 million this year in the Roanoke-Lynchburg, Va., television market, more than five times the amount spent four years ago.
The station owner says higher-than-expected campaign advertising changes its previously announced revenue estimates for political and full-year 2012 to record-setting $85 million+ and $400 million+, respectively.
SNL Kagan projects 68% growth over ’08. And if past trends hold true, the top 10 publicly held TV broadcast affiliate groups will see a 57.5% average increase in political revenue over 2008. Total political revenue for these groups would be $625.3 million, a 41.9% increase from $440.5 million in 2008. Journal and Scripps look to be the top gainers.
The resurrection of Newt Gingrich already is directing millions of dollars in local television advertising to the Sunshine State ahead of the end-of-month primary.
“Of the diversified media companies, CBS has the most TV and radio revenue exposure to the contentious political races of 2012,” says Wells Fargo’s Marci Ryvicker, who expects political advertising to reach $4.9 billion this year.
2012 will be a boon for TV stations. Bill Wheatley suggests they set up ‘Windfall tithing’ operations, pumping 10 percent of their bounty into solid election-year reporting to counter some of the misleading and even false commercials they will be running.
Media advertising analysts Ken Goldstein of Kantar says that should be a record take for local TV next year, driven by the proliferation of Super PACs spawned by last year’s Citizens United Supreme Court ruling.
TV political advertising spending could see rocketing growth next year, possibly climbing to just under $3 billion. Moody’s Investors Service says political advertising revenue for those pure-play broadcasters can expect gains of 9% to 18% over historically high political advertising levels seen in 2010, when spending on TV broadcasters got to $2.3 billion.
Tight political races and a surge in advocate and party spending drive the revenue surge at its 18 stations. The company awards its employees a one-time payment equal to two furlough days, at total of $1.5 million.