The London office of Publicis Groupe's ZenithOptimedia is less than euphoric at this year's growth prospects for UK television advertising expenditure.
The media agency's latest UK Television Forecasts, trims its 2005 TV adspend growth estimate to 1.5% - having in April predicted an increase of 5.2%. It cites the sluggish state of retail sales as a factor in the writedown.
However, ZO sees brighter prospects for 2006, especially in the light of next year's soccer Word Cup, which should boost TV ad growth to 4.3%. In the four years 2007-2010, an annual growth rate of between 4%-5% is predicted.
Over optimistic? Not so, says ZO: "This [growth] may seem implausible in the face of the threat to television advertising posed by personal video recorders, but this threat is counterbalanced by the boost to commercial viewing provided by the spread of digital television."
But the agency is less bullish about the revenue prospects for ITV, Britain's largest commercial broadcaster. Disappointing current-year viewing numbers could trigger a 4.8% decline in ad revenues, bottoming-out at around £1.59 billion ($2.81bn; €2.34bn).
The downward trend is set to continue through 2006, believes ZO, attracting only £1.53bn in adspend as compared with £1.67bn in 2004.
As to the UK's smallest terrestrial channel, Five, owned by Bertelsmann's RTL Group, ZO speculates that its steady increases in audience share may have peaked. A knock-on effect of which will be a standstill in advertising revenues.
However. the agency acknowledges that acquisitions or alliances with other broadcasters might boost both viewing and revenues.
Data sourced from BrandRepublic (UK); additional content by WARC staff