Several things are likely before this year is out.
With rare exceptions, we won't be going back to double-digit station multiples," said Mark Fratrik, vice president of the BIA Financial Network and a former executive of the National Association of Broadcasters. The reason reaches beyond the recession to systemic changes occurring in all of media and advertising.
Advertising dollars are expected to be 10% to 12% lower than 2008, which was the second-largest-ever spending decline. Marketers are clearly paralyzed or bankrupt waiting out the recession, during which time digital technology is radically altering the media game board. When Madison Avenue revives in 2010, marketers will be spending less and seeking more of the target consumer connections and qualitative data they can only get on the Internet and connected devices.
"Every local media company must broaden its thinking about what they are and how they go about their business," Fratrik says. That means partnering with Google and adopting its online ad auction model, partnering with local newspapers and other stations, aggressively getting into e-commerce and multicasting, and charging for their unique local content and services on mobile handheld devices, he said.
Now, more than ever, it's time to ask what business you're really in.
