Ad forecaster: Worst is over, but recovery will take a while

— -- An advertising forecaster said Monday that the worst is over for the U.S. ad slump but that across-the-board revenue growth won't resume until well into 2011.

Magna, a unit of the Interpublic Group, estimated second-quarter ad revenue fell 18% and said revenue will fall 14.5% for the year — the worst showing since the Great Depression.

"The economy accounts for the bulk of that decline," said Brian Wieser, Magna's global director of forecasting. "Every sector is being pulled down by this decline, every media that takes ad support."

The slump in ad revenue should moderate to a decline of 2% next year, with some media outlets showing growth such as local broadcast, national cable TV ads, online and outdoor, Magna said. Overall growth is not expected until the second half of 2011, and the average annual growth from 2009 to 2014 is expected to be an anemic 1%.

Magna's report, which is widely followed in the ad industry, this year began tracking ad revenue received by media outlets instead of ad spending by advertisers. Magna said the data is more accurate because of better sources.

The shift is a sea change since veteran forecaster Bob Coen began making ad predictions for Magna over half a century ago. Coen stepped down in March and remains a Magna adviser.

Magna said search advertising, ads that surround search results like ones offered by Google, is the only category not expected to show a decline in 2009.

While online media continues to fare better than other ad-supported outlets, Magna said television still has the widest reach and use. It said TV consumption is up for all audiences, and ad revenue for traditional TV is expected to dwarf online video for years to come.

Still, TV, like most major media, faces ad weakness. TV ad revenue is expected to total $47.7 billion, down 14% for the year. Its five-year growth rate is forecast at 3.2% on average per year.

Local TV ads are expected to fare much worse than national TV, mainly as a result of the downturn in local automotive advertising.