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Internet radio appeals to advertisers
affordable fun for any budget
Poland’s Open.fm internet radio portal is branching out to Ukraine, reports Mediabusiness.com.ua (December 2). There will be 15 channels of Ukrainian and foreign music for listeners 15 to 30 years of age.
The program director for the Ukrainian service, Svetlana Germanova, is also targeting advertisers. “We focus on advertisers who are interested in conquering the Internet audience. Advertising on the network is affordable fun for organizations of any budget.”
Open-fm is attracting about a half million visitors a day in Poland. “What Ukrainian media can boast of such an audience? Advertising (there) is more expensive than in prime time on the very top-end TV channel in Ukraine,” said Ms Germanova. “That's what we want.”
You go, girl. (JMH)
ProfMedia Broadcasting President Alexander Varin dies
Suddenly… a loss
Alexander Varin, considered a pioneer in Russian commercial broadcasting, died, age 44, Tuesday (December 1), reported RIA Novosti. The cause of death was a heart attack.
“It all happened suddenly, very suddenly,” said a ProfMedia spokesperson.
“Sasha was a very talented man,” said ProfMedia General Director Rafael Akopov. “His talent lay in the fact that he combined being a major creative leader and a very serious administrator. All the media of Russia will feel the loss.”
Varin managed the ProfMedia radio and television stations. He was perhaps best known for directing the popular radio channel Avtoradio. He was also president of the Russian Radio Academy.(See more on Avtoradio here)
A memorial will be held Friday December 4 at the Moscow Aviation Institute where Varin graduated with a degree in mathematics. (JMH)
Christmas Used To Be THE British TV Season, But No More
In the good old days, as the old timers like to recall, the very best British TV would be on at Christmas. The BBC and ITV would compete like crazy to get Britons watching the telly – many factories would close down perhaps for as much as two weeks for the Christmas period so there were lots of bods sitting on the couch glued to the set. When a really popular program ended there was always a chance of a power cut because of the surge in electricity usage as the kettle went on in homes throughout the UK to make a cuppa.
Big money was spent to win the Christmas ratings – the latest movies, sometimes global world terrestrial TV premieres -- special editions of favorite programs and the like, but with money kind of tight these days at the BBC, ITV, and Channel 4 the times, they have changed. Today those still lucky enough to get long Christmas breaks heads for foreign shores instead of staying at home freezing in the depth of the British winter.
So, the British media has figured out that for this Christmas there will be some 600 hours of repeats during the two-week festive season which they figure is the most ever for Christmas.
The politicians, many of them probably deep now into planning their escape abroad, know a good issue to attack when they see it, so little surprise, for instance, that John Whittingdale, the chairman of the opposition Conservative’s culture, media and sport committee, would opine, “Certainly during peak time viewing, people are entitled to new programs. The BBC in particular should not be relying on old shows considering they receive £3.6 billion in license fees”.
So there!
Tribune Will Let Murdoch Try Pay Walls First
Sam Zell, who gets promoted, if that is really the right word, to chairman of bankrupt Tribune Group while Randy Michaels becomes the CEO, applauds Rupert Murdoch for moving to Internet pay walls, but he says Tribune won’t do it until it sees how successful News Corp. is.
Zell says there is no doubt that current newspaper business models are broken – if anyone knows that it should be he – and there is no doubt that giving news away for free doesn’t work.
In a CNBC interview he said, “I’m more than willing to let Rupert take the first sword. And if it works then I think everybody is going to follow him, and should have in the first place.”
Which Country Has The World’s Highest Newspaper Circulation?
If you answered China, you would be wrong, for India has now surpassed China to be number one with 107 million daily sales, and what may be truly surprising is that if you add the circulations in India, China and Japan together you have more than 60% of the world’s newspaper sales, according to WAN-IFRA. The US, by comparison, accounts for 14% of global newspaper sales.
Measured by the number of sales per 1,000 adult population, Japan leads with 612, followed by Norway with 576, and Finland with 482. In terms of reach, an astonishing
91% of Japanese read a newspaper daily. That begs the question, of course, of what is it Japanese publishers know that others don’t in maintaining their newspaper readership, especially considering how prevalent the Internet is in Japan.
As for readership, globally, 1.9 billion people read a newspaper every day – 34% of the world population -- while 24% uses the internet.
Advertising Falls All Over The World
PricewaterhouseCoopers reports that advertising revenues this year have fallen an estimated 20%in North America, 19% in eastern Europe, 16% in western Europe, and 11% in Asia Pacific. It says the US market was hardest hit, with Q3 advertising revenues falling nearly 29% in print and nearly 17% on digital platforms over Q3 last year.
"While we have systemic challenges, while we transition from a print only model to new forms of publishing over time and that we can exercise control over, there still remains outside forces namely the economy that we have little control over," said Timothy Balding, co-ceo of WAN-IFRA at the group’s annual meeting being held in India.
There was a little good news. Over five years, according to WAN-IFRA’s Press Trends survey, newspaper circulation increased in 100 of the 182 nations for which the group has reliable data.
Ad demand up, revenues down
Selling cheap
Turned on its head and shaken, media economics looks far different today than it did a year ago. Analyzing the spending of Poland’s biggest advertisers, analyst DGP found the biggest advertisers haven’t reduced spot buys at all, reported in Gazeta Prawna (December 1). In fact, eight of the top ten television advertisers have been spending more during the first nine months of this year. Spot TV demand from big advertisers like Unilever and Nestlé is up.
Spot prices, however, are down, as much as 50% said the report. TV broadcasters in Poland cut ad prices when local advertisers, hit by the recession, stopped buying. Big multi-nationals jumped in to take advantage of lower prices. The lower TV ad rates then forced all ad rates lower. (more on ad spending here)
“They buy cheap or not at all,” said one media executive quoted in the article. (JMH)
US News Organizations Get About $1 Billion In Subsidies Annually
With the US Federal Trade Commission opening hearings today on whether US news organizations need government financial help, the Online Journalism Review of the University of Southern California figures this is a pretty good time to remind everyone that big media subsidies already exist – ranging from tax breaks, postal subsidies, and legally mandated public service announcements – that are worth more than $1 billion annually.
The article’s two eminent authors – Geoffrey Cowan, dean emeritus of the Annenberg School for Communication and Journalism, and David Westphal, former Washington bureau chief for McClatchy newspapers, write, “The truth is that American government and the news business have always been joined at the hip, and not just through the government’s copyright protections, restrictions on anti-competitive practices and regulation of the airwaves. It’s also through the infusion of tax dollars.”
The article says that postal subsidies today are worth about $270 million annually, local, state and the federal governments spend hundreds of millions of dollars on small-type legal notices mandated by law that few people read, and the newspaper industry benefits from various Federal and state income and sales tax breaks worth around $890 million a year. The authors note that for various reasons all of these tax breaks are shrinking, but they’re still worth more than $1 billion a year.
So much for the argument of not accepting government subsidies for fear of government editorial pressures.
Where Do Global Advertisers Spend The Most?
The US is the by far the world’s largest advertising market so one might think that US gets the bulk of the spend by the 100 top global advertisers. But then one would be wrong for, according to the Ad Age Global Marketers study more than 60% of the spend by the top 100 last year was outside the U.S.
Procter and Gamble, the world’s largest advertiser, gets 61% of its revenues from outside the U.S so perhaps it was not that surprising that 65% of its advertising spend was outside the US.
And then there is Coca-Cola. About 25% of its total sales are in the US, yet only 16.5% of its ad budget was spent there. Near 50% went to Europe.
According to Ad Age, the 100 top advertisers spent $44.4 billion in the US last year which was about 38% of the total while Europe got $46.3 billion (39%). But whereas US advertisers seemed to concentrate overseas, the opposite was true by some of the non-Americans. Six of the 56 non-US companies in the Global 100 spent more than half their media budgets in the US, according to the study.
Gloomy report on broadcasting
Private sector revenue down, public up
Fiscal 2008 was dreadful for broadcasting in Germany. And 2009 has not been a significant improvement, says an economic study commissioned by the Bavarian Broadcasting Authority (BLM) released November 30. Recovery, however that’s divined, could be years away.
Results from the study – “Economic situation of broadcasting in Germany 2008/2009” – show the impact of shifting revenue models. Revenue losses at free-to-air TV and radio (assumed free-to-air) dropped 11% and 9%, respectively. Pay TV revenue dropped on 1% while teleshopping revenue gained 6%. Net income for all German private sector commercial broadcasters fell 7% in 2008 to €4.35 billion.
German broadcasters generated only 3.3% of revenue from online sales in 2008, €252 million. Experts quoted in the report expect online revenue for radio broadcasters to increase 6.5% by 2013 and 9% for television broadcasters.
German broadcasters are optimistic about a general economic recovery. Near half (46%) expect recovery to arrive in 2011. One in five expect recovery next year (2010). Fifteen percent believe economic recovery will appear in 2013 or later. (See more on media in Germany here)
While the economic crisis has hurt private sector broadcasters, German public broadcasters’ revenues have grown to €8,6 billion (2008) compared with €6.5 billion for private sector broadcasting. The operating profit for private sector television dropped to €629 million in 2008 from €1.06 billion in 2006. Operating profit for private sector radio dropped to €84.5 million in 2008 from €97.3 million in 2006.
Broadcasting employment has held steady overall, dropping less than 1% since 2005 to 74,914. The report notes that public broadcasters have been shedding workers since 2003 while private broadcasters – mainly due to organic growth – have increased payrolls. (JMH)
Inertia replaced by confusion in digital radio path
low blow to radio in France
Digital radio’s trajectory through the mire of inertia and finance has risen – in France, at least – a decibel level or two. The French digital radio support group DR France succeeded in facilitating a discussion on a way forward. When the four biggest commercial broadcasters appeared to back out, DR France called it a “low blow to radio.” (See DR France statement here – in French)
Digital radio supporters in France had been hearing mixed signals from the government until Culture Minister Christine Albanel stated emphatically that digital radio – presumably on the DVB-T platform – would be supported. Then French regulator CSA chartered an expert to lay out a framework for moving digital radio forward. In the midst of this the four major commercial broadcasters, under the banner of Bureau de la Radio, suggested a less expensive alternative to DVB-T might be explored, one like HD Radio (also known as IBOC).
Then CSA’s expert returned the verdict that digital radio as proposed would never fly as it defied economics. (See file item here) Rachid Arhab, chairperson of the CSA digital radio committee, answered by reminding the expert that his mandate was to chart the digital future not criticize it.
Another big meeting was held, hosted by French regulator CSA. Again, the plan was to chart a plan and not to un-do it. The discussion had been whittled down to one primary issue: finance. The presumed shift to a different radio platform will be, all agree, hugely expensive. But all the stakeholders seemed, at least, to buy into notion of sharing the expense.
That has unraveled. It’s unraveled in France as the big four commercial radio network operators changed their minds. They’ve been hedging their bets for months, keeping commitments vague.
This is and isn’t – typically French - just about cash. The big French commercial network owners are beyond rich; RTL, Lagardère, NRJ Group. Spending needlessly, even for the biggest, is not on; dismal economics raising tensions. DR France noted “the economic crisis does not justify the position (of the Bureau de la Radio members).”
It’s more likely that the big French commercial network owners now see a bigger nightmare from digital radio. That would be run-away competition on a platform they don’t control. None of this kills digital radio in France (or anyplace else) but it does put a different spin on the path of digital migration. (JMH)
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