the online opportunity: doing the deal april 20, 2006 introduction by gordon borrell, ceo
TRANSCRIPT
The Online Opportunity:Doing the Deal
April 20, 2006Introduction by Gordon Borrell, CEO
Growth of Local Online Adv.Since 1998
Growth of Local Online Adv.Since 1998
© 2006 Borrell Associates Inc.
$987
$420
+91.8%
+151.1%+19.5%
+18.0%
+25.9%
+29.3%
$4,390
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
1998 1999 2000 2001 2002 2003 2004 2005 2006e
Lo
cal O
nlin
e A
dv.
($
in M
illio
ns)
Local Online Ads
Local Paid Search
$1.17
$1,650
$2,078
$2,687
$243
$1,398
$466
$1,170
$4,769
+79.0%
+19.7%
TV Web Site Revenue Growth, 2002-2006 projected
($ in Millions)
TV Web Site Revenue Growth, 2002-2006 projected
($ in Millions)
© 2006 Borrell Associates Inc.
$55$75
$119
$283
$410
$0
$500
2002 2003 2004 2005 2006p
Source: Borrell Associates, Inc.
Some Local Sites Now LargerThan Biggest Radio Station in Mkt.
Some Local Sites Now LargerThan Biggest Radio Station in Mkt.
© 2006 Borrell Associates Inc.
$42.9
$31.7
$17.0
$15.0
$9.0
$17.0
$5.8
$8.0
$47.0
$10.7
$2.8
$45.8
$8.1
$35.0
$26.8
$12.7
$9.0
$7.6
$1
1 2 3 4 5 6 7 8 9
Largest Local Web Site: 2005 Revenue
That Site's Projected 2006 Revenue
Largest Radio Station $ in Same Market
$50 M
$1 M
Large Markets Small MarketsMedium Markets
The Web’s Contribution to TV for Eight Station Groups
© 2006 Borrell Associates Inc.Source: company reports to Borrell Associates, Inc. Nov. 2005
Online Revenues as
% of Gross Co. Revenue
Broadcast Co. #1 2.6%
Broadcast Co. #2 2.1%
Broadcast Co. #3 1.9%
Broadcast Co. #4 1.7%
Broadcast Co. #5 1.5%
Broadcast Co. #6 1.1%
Broadcast Co. #7 0.5%
Broadcast Co. #8 0.4%
Average: All Stations 0.6%
© 2006 Borrell Associates Inc.
TV Web Site Share of Local Online Advertising in the DMA, 2005
TV Web Site Share of Local Online Advertising in the DMA, 2005
0%
5%
10%
15%
20%
0 210
DMA Market Size
Sh
are
of
Lo
ca
l On
lin
e A
dv
ert
isin
g
TV Web Site Profitability
• Average margin +29.6%• 65% were profitable, 35% were not• Of the profitable sites, avg. margin was 79%• Confidence level in reporting: 93%
© 2006 Borrell Associates Inc.
Ad Categories Expected
to be Top 3 Growth Areas in 2006 Ad Categories Expected
to be Top 3 Growth Areas in 2006
© 2006 Borrell Associates Inc.
0% 5% 10% 15% 20% 25% 30%
Telecom/ISP
Movies
Job Listings
Real Estate
Local Retail
Restaurants/Ent.
Banks
Auto
Health Care
Source: Borrell Associates, Inc.