| The success of national commercial radio stations has produced a sustained long-term growth in advertising revenues to the commercial radio market, and strong growth occurred between 1997 and 2000. During 2001, however, advertising expenditure in all media — including commercial radio — declined. Key Note estimates that, in 2002, the value of the commercial radio sector will remain static at 2001's figure. Key Note anticipates that growth in revenues will resume in 2003, at around 5% per annum, to give a market value of £666m in 2006 at constant 2002 prices.
Commercial radio's audience has not grown as fast as the number of stations, but revenue from advertising and other sources has soared. In part, this is because many of the new stations cater for specialist tastes; for example, XFM, one of London's newer stations, plays `alternative rock'. This has drawn in new advertisers keen to reach small but dedicated audiences. In spite of the segmentation of the audience, however, most of the new advertising revenue has come from mass-market brands, such as Coca-Cola and McDonald's. This report covers the industry, focusing primarily on the UK market.
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