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PQ Media: DOOH Growth Remains Strong, Global Growth Outpaces U.S.

A new forecast from PQ Media has hacked its prediction for digital out-of-home growth for 2009 and 2010.

While PQ Media previously called for digital OOH growth of more than 6% this year, the research firm is now saying DOOH will grow just 2%, to $2.5 billion, in the U.S. Next year, DOOH will grow 6.2%, to $2.62 billion, down from a previously forecast 10%. DOOH will grow at a compound annual growth rate of 9.4% through 2014 in the U.S.

Last week, a report from BIA/Kelsey predicted that DOOH spending will continue to soar in coming years. BIA/Kelsey said the medium will increase at a rate of 13.5% annually, from $2.2 billion in 2009 to $3.7 billion in 2013, by far outdistancing traditional out-of-home’s 1.4% growth (which will grow from $4.4 billion to $4.6 billion).

PQ Media’s CEO and president, Patrick Quinn, said a number of things need to happen before DOOH becomes what he calls “the real deal.” Most important, the medium needs to solve problems of fragmentation, scalability and measurement. BIA/Kelsey predicted that some of those issues will be resolved in the next few years, with consolidation, partnerships and interoperable platforms becoming more integrated and spurring growth.

Consolidation has been taking place in the market at a high rate of speed in the last year or two. Most recently, Zoom Media acquired Gym Screen Media in the U.K., adding 160 venues to its fitness network.

PQ predicts video advertising networks, the largest segment of DOOH, will grow 1.2% in 2009, with cinema up 6.1%. Video advertising networks will grow 5.7% in 2010, PQ predicts, following a compound annual growth rate of 17.2% from 2004-2009. The next largest DOOH segment (and the fastest growing), digital billboards, will be up more than 9% for the year, and will grow by 13.2% in 2010.

DOOH will account for 34% of the total out-of-home market in 2009, and will make up 41.5% of the total OOH market by 2014.

India, China, Brazil and Canada lead the international growth markets. Eastern European and Middle Eastern countries were hurt by the credit crunch and falling oil prices and this will continue to affect them throughout 2009. Asia/Pacific will be the fastest growing region of global digital OOH, rising 10.7% in 2009 to $2.18 billion, an acceleration of the 8.8% gain in 2008, when that region already was stuck in a recession before most of the rest of the world.

DOOH expenditures worldwide will grow 4.7% to $6.69 billion this year, and 10.1% over the next five years.