Moody's Says TV Broadcaster Ad Revenue 'Under Attack' Amid Tech Competition

The broadcast TV industry's 12- to 18-month outlook “remains stable,” Moody's emailed investors Monday. “Companies will continue to face serious headwinds as declining viewership drives down advertising revenue and consequently hinders earnings growth.” Ad revenue will continue to experience negative growth, analyst Jason Cuomo said. "Broadcasters' earnings are heavily influenced by the health of the advertising market, given their revenue mix is still weighted toward ad revenues, but today this ad-supported business model is under attack." Viewership of the top-four news channels is declining, and broadcasters are losing market share to Google and Facebook, Moody’s said. The ad market problems are being balanced by retransmission consent rates, “up by approximately 23% in 2017, much higher than previously anticipated,” Moody’s said. “Cyclical events, including the Olympics and mid-term Congressional elections, will provide an additional lift for broadcasters in 2018.”