The ad firm’s forecast will set an upbeat tone for the Monday kickoff of the UBS Annual Global Media and Communications Conference, the widely watched series of CEO briefings that runs through Wednesday in New York. Zenith’s projected 3.5% growth, to $160.3B, contrasts with +2.2% in 2011. Much of the improvement is attributable to the predicted excitement around the Summer Olympics in London, as well as the recovery of Japan’s economy following the earthquakes and tsunami in March. That will help to drive large financial companies, retailers, and auto makers back into the ad market. Television will be the main beneficiary, with a 5.1% increase to $61.9B. But the Olympics won’t be enough to stop the ad slide at the major broadcast networks (-1% to $16.9B). The problem is the time difference with London: That “will mean fewer events airing live than there were for the Vancouver Olympics,” Zenith says.  It predicts that more viewers will “tune in online to watch their favorite events rather than wait to watch pre-recorded versions.” Syndication will suffer a bigger decline (-12% to $2.2B) as studios struggle to find a daytime host who can match the popularity of Oprah Winfrey. But national cable networks including USA, TBS, and FX will continue to improve (+10% to $20.1B).

In other media: The Internet is still soaring (+16.4% to $30.3B) and will be helped in 2012 by political candidates hoping to reach voters on social media destinations led by Facebook. The Olympics and political campaigns will enable radio to hang in (+2.1% to $16.7B) despite the growing popularity of streaming services such as Pandora. Movie theater ad sales will improve (+5% to $725M). But consumer magazines won’t be so lucky (-2.2% to $18.2B). And newspapers will continue to to lose ground (-8% to $25B).

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