Local TV: By the Numbers
By Deborah Potter of NewsLab, Katerina-Eva Matsa and Amy Mitchell of the Project for Excellence in Journalism.
New to this year’s report is a streamlined data section that houses a comprehensive set of charts and tables telling the story of each media sector. For a narrative summary, visit the corresponding essay.
Local television stations got a split decision in 2010. Revenues rose substantially from a five-year low in 2009 but the audience for local news in key time slots on network affiliates continued to fall. Overall, however, the audience for local TV news held steady, thanks to a larger audience for news in nontraditional time slots and on independent stations, which added newscasts in more markets.
The most basic problem facing local television news is that its traditional audience is shrinking. In 2010, audiences continued to decline in all three key time slots: morning, early evening and late night. 1
PEJ analyzes data from Nielsen Media Research about individual stations and computes national averages for each time slot. We then compare those averages year-to-year. This year’s charts show only three of the four major sweeps periods – May, July and November. February is not included because there were no comparable data from 2009, when ratings were collected in March due to the planned switch from analog to digital broadcasting. Similarly, when calculating annual averages for the past four years, we left out all February/March data. (See backgrounders for more)
Early evening local news programs (5 to 7 p.m. Eastern Time or equivalent) on network affiliates had a roller-coaster year: Down in May, up in July and down again in November for an overall average decline of 1.1%. This is better than the year before, when they lost 5.3% of their viewers, on average.
The big picture for early evening newscasts remains challenging. Over the past four years, what used to be known as the “newscasts of record” on local network affiliates have lost more than 2.1 million viewers, or 8.5% of their audience.
Late local newscasts (11 to 11:30 p.m. Eastern Time or equivalent) on network-affiliated stations also continued to lose audience in 2010. The year-to-year decline of 6.8% in May was twice as severe as the decline in the same month from 2008 to 2009 (3.4%). Slight gains in July and November kept the average loss for the year to just under 2%. These data do not include the hour-long 10 p.m. newscasts on many Fox affiliates, which are analyzed separately. (See Fox section for more)
Late newscasts following prime time have been losing audience somewhat faster than early evening newscasts on network affiliates over the past four years. Their total average audience has dropped by 9.7%.
Morning news (5 to 7 a.m. Eastern Time or equivalent), once looked to as a potential growth area for local television, fared only slightly better. Overall, these programs lost 4.6% in May, bounced back a bit in July with a 2.3% gain but declined again in November, for an average loss of 1.3%.
Over the past four years, the audience for morning news programs has declined less than news in other day parts, but the overall audience is still down by 5.2% since 2007.
A pattern noticed a year ago continued in 2010. Our analysis found that ratings dropped more sharply than share for all key time slots in most sweeps periods. Ratings measure the percentage of households with TVs that are tuned to a particular program. Share measures the percentage of people who actually have their TVs on at a particular time and who are tuned to a specific program. A ratings decline, while share holds steady, means a program has fewer total viewers but the same percentage of the available audience. To put it another way, one reason local TV news in the traditional time slots is losing viewers is because people are turning off their sets when the news is on.
As network-affiliated stations continue to add newscasts in different dayparts, one might expect to see audience declines in one time slot offset by growth in another. (See news staff section for more) That did not occur in 2010. The audience for midday newscasts, for example, was down even more than other time slots. The rate of loss was almost twice as great as the year before (2.1%).
True, the midday audience loss since 2007 has not been nearly as steep as other dayparts, but there is no evidence of growth.
One time slot during which viewership did grow is in the very early hour, 4:30 a.m. As a consequence, more stations are beginning to air news there. Stations in 69 markets had news on the air in that time slot in 2010, according to a PEJ analysis of Nielsen data and news reports. That compares to 28 markets the year before. Not surprisingly, viewership has shot up as well, up more than 50% in just one year.
Another bright spot: Viewership was higher in all sweeps periods for local news that airs in the 7 p.m. Eastern Time slot or equivalent, after the early evening local news or network news. Traditionally stations aired syndicated entertainment or game shows during this time, but 291 stations aired news at that hour in November 2010, according to a PEJ analysis of Nielsen data.
Over the past three years, newscasts in this time period have held on to a larger share of their audience than local newscasts in other slots.
Local News on Fox Stations
Many Fox affiliates air an hour-long newscast at 7 a.m. Eastern Time or equivalent because Fox does not provide a network morning newscast for them in the same way the other three commercial networks do. These local newscasts continued to lose viewers, although the decline was much less severe than the year before. After losing about 4.9% of their audience in 2009, morning newscasts on Fox affiliates lost just 1% in 2010.
The audience for local Fox morning newscasts had grown in 2008, however, so the decline over the past two years is a new and worrisome trend for those stations, especially since the audience shrank even as more stations aired news in that time slot. The average number (for all the sweeps each year) of markets in which Fox stations air morning news grew from 61 in 2007 to 75 in 2010.
The numbers were even worse for prime time newscasts on Fox stations (10 p.m. Eastern Time or equivalent). While the audience losses in this time slot were not as steep as in 2009, when viewership was down more than 16.4% in November alone, these hour-long newscasts continued to lose audience at a greater rate than the half-hour newscasts on ABC, CBS and NBC stations that air an hour later. (See late newscasts section for more)
After a slight uptick in ratings in 2008, prime time newscasts on Fox stations lost 15% of their average audience in just two years.
Local News on Independent Stations
Independent stations have bucked the overall trend. As they have added more news, their audiences have grown. While these stations drew less than 3% of the total viewership of local TV news in 2010, their audience grew more than 35%. Especially telling is the year-to-year uptick in viewership for news at 10 p.m., where independent stations gained viewers even as Fox stations lost them. 2
Local TV News Economics
The general economic recovery combined with a free-spending climate for political advertising made 2010 a much better year for the local television business. For the first three quarters, actual spending on local TV was up 27% from same period a year earlier, according to a TVB analysis of Kantar Media data. A December report from BIA/Kelsey estimated total 2010 ad revenue for local stations at $18.5 billion, up 17% from 2009.
Political ad spending on local TV set a new record in 2010. Of the estimated $3 billion spent, $2.2 billion (73%) went to local television stations, according to Evan Tracey, chief operating officer of Kantar Media’s Campaign Media Analysis Group.
Stations made even more from political advertising in 2010 than in 2006, the previous nonpresidential election year, primarily because a Supreme Court ruling lifted some restrictions on spending by interest groups. Another factor driving political spending was an increase in the number of competitive races for both House and Senate seats, said Mark Fratrik, vice president of the media analysis and consulting firm BIA/Kelsey.
In addition, auto ads that had virtually vanished in 2009 returned to the air in a big way, up 77.2% from the year before through the first three quarters of 2010. Other sectors showing healthy increases year-to-date included financial (up 51.2%), home and hardware (up 37.9%), media and advertising (up 36.4%) and department stores (up 34.6%).
While the revenue picture improved in 2010, other data show that the long-term revenue picture for local stations that produce news is grim. When adjusted for inflation, average station revenues have dropped more than 46% since 2000.
A glance at local station revenue in the top 101 markets from auto ads over the past four years may help explain the sharp decline in average revenue.
As advertising recovered, station groups reported substantially higher revenue in 2010. Third-quarter numbers were strong compared to the year before, and the final quarter was expected to be at least as good because it included a large chunk of the year’s political ad revenue.
Broadcast stations also made up some ground in 2010 in the battle with cable channels for local spot advertising. (See Essay for more) In 2007 and 2008, local spot ad revenue on broadcast stations declined while spending on local cable ads increased. Local spot ad spending on both cable and broadcast declined in 2009 and grew in 2010, but estimates indicate that cable spending was down less than broadcast in 2009 and grew more in 2010. Broadcast still reaps about twice as much as cable from local spots, but estimates suggest cable growth will continue to outpace broadcast in coming years.
Stations in the top 25 markets lost the most revenue on average in 2009, the last year for which data are available. 3 This is largely due to the fact that they take in far more money than stations in smaller markets, so their total dollar loss is greater.
But measured by percentage losses instead of dollars, the picture changes. The pain in 2009 was spread almost evenly across market sizes, unlike the year before (2008) when revenues were down by 22% in the top 25 markets but only 3% in the smallest markets (151+). A PEJ analysis of BIA/Kelsey data found that proportional revenue losses in 2009 were within a few percentage points in all market sizes, with markets 26 to 50 taking the biggest hit (17%) and markets 51 to 100 losing the least (13%).
For the first time since 2004, less than half of all news directors in 2009 said their stations made a profit on news. That was a 5% decrease from 2008. And more than a quarter of news directors said they didn’t know if their stations were making a profit, a record high.
The strong revenue picture for local television stations in 2010 suggests that local TV news profitability most likely rebounded as well.
While still relatively small, online revenue is a growth area for local TV news stations and that continued in 2010. According to Borrell Associates, local stations brought in $1.34 billion from online advertising in 2010, an 8% increase from the year before. That’s far less than the 21% increase that Borrell had forecast for the year, but still a healthy uptick. Stations also captured a larger share of local online advertising – just under 10%, according to the Borrell data. Overall, however, online still makes up just 5% of local TV advertising revenue.
Local stations are also making a relatively small amount of revenue from mobile advertising (on phones and tablets). Stations brought in $29 million in local mobile advertising in 2009, Borrell reported. That is 12% of the total local mobile advertising market.
Revenue from ad sales on both online and mobile platforms is expected to increase in future years.
Newsrooms entered 2010 with budgets drawn up during one of the worst years ever for local station revenue. Two-thirds of news directors surveyed said their budgets were cut in 2009, up substantially from 40% in 2008.
Unlike the year before, when stations in the largest and smallest markets took the biggest hits, the pain in 2009 was spread across all market sizes, with well over half of all news directors reporting budget cuts. In midsize markets (51 to100), almost two-thirds of news directors said their budgets decreased. Presumably, those numbers would have eased in 2010, but those data are not yet available.
Indications are that newsrooms were hiring again in 2010. From interviews and other evidence, we estimate that likely additions to staff made up for all of the 2009 losses and possibly more. At the end of 2009, almost a quarter of news directors said they expected to increase staff in 2010, more than twice as many as the year before. And less than 10% expected to cut. At the end of 2008, by contrast, almost a third of news directors expected to cut staff in 2009).
Survey data indicate that local newsrooms cut staff by 1.5% in 2009, considerably less than the 4.3% reduction reported in 2008. Even so, the median staff size at all local TV newsrooms fell to the lowest level since 2003, around 29 people. Only independent stations, which make up just 8% of the sample, reported increasing staff in the depths of the recession.
As staffs shrank in 2009, salaries in local TV news actually grew overall by 2.5% compared to a 4.4% decrease the year before. Reporters, managing editors and graphics specialists had the largest gains, about 10%. Top news managers and sports anchors lost ground.
In 2010, more local TV stations let some of their higher-priced on-camera talent go, a trend noted in last year’s report. The impact of those staff changes may be reflected over time in average salaries.
Local TV News Content
There is every indication that the amount of news produced by local television stations on weekdays hit a new high in 2010, building on the record set the year before. More than nine-in-ten news directors surveyed said the amount of news they produced would stay the same (57.4%) or increase (32.6%) in 2010; less than 2% expected a reduction. The reason is simple: If audiences for traditional newscasts are shrinking, one way to build audience, and revenue, is to air more news. Generally speaking, stations can add local news more cheaply than they can buy syndicated programming.
Stations are also distributing news content in more ways than ever. More than two-thirds (68.8%) of news directors said their station took a “three-screen” approach to news, providing content on air, online and on mobile devices. The number of news directors who said their stations produce news for mobile devices shot up to 45%. That’s double the percentage that reported producing news for other platforms in 2008, including mobile. Those who said they ran local news on another station in the market remained steady, but more stations reported producing news for a station not in their market and for local radio outlets.
Local TV websites continued to add some features online but pared back on others. Text, still pictures and news video have become the norm on local station online sites, available on more than 90% of them.
Other online features have become more common, as well, on local TV station sites. The latest available data (2009) shows a noticeable increase in the use of audio, live cameras, recorded newscasts and blogs.
Local stations cut back on the use of other types of content on their websites in 2009, however, including streaming audio, podcasts and assemble your own newscasts.
- Over the past four years, the number of markets where local news airs in the three key time slots has been virtually unchanged according to PEJ’s analysis of data from Nielsen Media Research. ↩
- Nielsen Media Research revised the way it counts independent stations in August 2009, so reliable comparisons can only be made from November 2009 to November 2010. [1. Nielsen Media Research revised the way it counts independent stations in August 2009, so reliable comparisons can only be made from November 2009 to November 2010. ↩
- PEJ analyzes BIA data for stations that list a news director and that are commercial, English-language, viable (significant share of audience), with measurable revenue. ↩