U.S. Media Industry Revenue Rose 3.1% in 2010 for First Gain Since 2007

The U.S. entertainment and media industry last year grew 3.1 percent, its first gain since 2007, as marketers returned to advertising online and on television, according to the accounting firm PricewaterhouseCoopers LLP.

The U.S. media sector, which includes movie studios, TV networks, radio stations, newspapers and the Internet, will grow 3.5 percent this year, New York-based PWC forecast today in its annual industry overview.

Online advertising and Web access, pay-TV subscriptions, billboards and movies will lead the industry to mid-single-digit percentage gains between 2012 to 2015, PWC said. Spending on recorded music and newspapers will be lower in 2015 than in 2010. Overall growth will average 4.6 percent compounded annually, with sales rising to $555 billion in 2015 from $443 billion in 2010, according to PWC’s report.

Digital products will account for 59 percent of worldwide growth in the media industry during the next five years, while they contribute about 25 percent now, PWC said. In the U.S., digital products will account for 29 percent of entertainment and media spending in 2015, compared with 21 percent last year.

U.S. advertising spending climbed 5.4 percent in 2010 after declining 14 percent in 2009, PWC said. Overall advertising will increase at a 4.2 percent compound annual rate to $208 billion in 2015 from $170 billion in 2010.

Online advertising will average 12 percent growth compounded annually, while video games and movie theater advertising, the two smallest segments, will grow by 8 percent and 6.7 percent, respectively, on a compounded annual basis, PWC said.

TV advertising, the largest category, is expected to grow at 4.9 percent. Spending on newspaper ads will shrink 0.2 percent, along with directories, the only advertising categories expected to decline, according to PWC’s forecast.

The S&P 500 Media Index fell 1.08 to 215.48 yesterday. It’s gained 8.7 percent this year.

To contact the reporters on this story: Andy Fixmer in Los Angeles at afixmer@bloomberg.net

To contact the editor responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.