INSIGHTanalysis: Media Healthcheck – July 2006
July saw an in-depth discussion on the press at the MediaTel INSIGHT Future of The National Press seminar, with industry figures giving their opinions on the challenges ahead.
The huge success of freesheets was also a big talking point at the seminar, with Stuart Taylor, commercial director at Guardian Newspapers Ltd, saying: “I think Metro is a phenomenon. It’s not for everybody but I think they’ve been brilliant in capturing that moment in time when people are travelling and I think that’s extremely clever and very effective. Advertisers are falling over themselves to get space in there.”
UK press advertising will remain static year on year, according to ZenithOptimedia, who added that marginal growth in display will be offset by declines in the classified sector, with money from that market going more towards online.
The total UK advertising spend forecast from ZenithOptimedia said that it would reach £12.25 billion in 2006, up 4.1% on 2005 (see UK Adspend Predicted To Rise 4.1% On 2005), although this is lower than the 6.1% growth predicted globally and the 4.4% growth forecast for Europe as a whole and, when adjusted for inflation, UK growth is expected to be just 1.4%.
Additionally, the Q2 2006 Bellwether report, the quarterly survey of marketing spend from the Institute of Practitioners in Advertising (IPA), showed that the trend was continuing for traditional advertising to struggle, while internet and direct marketing saw their budgets grow (see Q2 2006 Bellwether: Marketing Budgets Revised Down For Fifth Consecutive Quarter).
From a global perspective, GroupM said that worldwide media and marketing services spend will grow 6.2% this year to $673 billion and is predicted to grow 6% next year to $713 billion, slightly ahead of 5%-6% expected growth in the global economy (see Worldwide Media And Marketing Spend To reach $713 Billion In 2007).
Elsewhere, it was forecast that 16 million European homes would adopt broadband this year, taking the total figure for residential subscribers up to 73.2 million, according to a report from Strategy Analytics.
The report also predicted that the number of residential broadband customers in Western Europe will reach 108 million, or 63% of all households in the region, by 2010 (see 16 Million European Homes To Adopt Broadband In 2006).
However, research from Nielsen//NetRatings showed that internet user numbers dropped slightly from May to June, with a decline of about 750,000 users across 10 countries (see Internet User Numbers Drop From May To June).
If, as Strategy Analytics predicts, broadband does continue to boom, then IPTV will no doubt be one of the applications that consumers increasingly make use of. The Diffusion Group (TDG) forecast that global IPTV subscriptions will jump from two million in 2005 to 34 million in 2010, with North America being quickest to adopt, at a compound annual growth rate (CAGR) of 78% (see Global IPTV Households To Near 34 Million By 2010).
Results of a survey from Accenture, in association with the Economist Intelligence Unit, predicted that the chief revenue generator for IPTV will be video-on-demand (VoD), with 34% of respondents believing that IPTV will generate significant revenue by 2009 (see Video-On-Demand Predicted To Be IPTV Revenue Generator).