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Media
Media buying agency predicts magazine and newspaper closures
By CMU Editorial | Published on Thursday 4 June 2009
So, if you thought the music business was in a state of disarray, sit back and relax and enjoy finding out the media is in a much worse position. Or at least that’s what the media-buying operation of advertising industry giant WPP reckons. Group M says that ad spend with print media will decline even more than expected this year, leading to some smaller titles losing their share of the advertising pound completely. The result, the agency says, is that dozens of magazines and newspapers, some “household names”, could fall of the proverbial cliff.
Group M’s predictions differ from previous commentaries which predicted the advertising recession would reach its trough this summer, enabling the sector to recover a little in the latter half of the year. But the WPP division reckon national newspapers will see their ad revenues fall 18.6% for the whole of 2009, while regional newspapers will see ad monies fall a massive 32%. Consumer mag income with be 20% down.
Group M futures director Adam Smith told reporters: “No previous ad recession has put household media names at risk like this one has, from local newspapers to high-street magazines to national TV channels. Advertiser demand is set to remain weak this summer so it is possible mergers, restructures and closures will accelerate as we move into the fourth quarter”.
It doesn’t help, Group M add, that the ad slump has come as paper prices have risen, and as media companies need to continue to fund loss-leader online activity to ensure long term success. The result, they reckon, is that smaller and weaker media firms may hit the wall, meaning that the big boys who can better weather the storm, like Rupert Murdoch’s News International, will become stronger long term. Which is a lovely thought.
Group M’s report follows a recent survey by InPublishing which found magazine owners generally optimistic that business would start to pick up again later in the year, though that report did find that some of the publishers surveyed were optimistic partly because they expected some competitors to go out of business, giving them a bigger share of the market.
