MRG Conference – Amsterdam – Day 1
Yesterday at the MRG conference in Amsterdam Len Sanderson, Ad Director of Daily Telegraph plc. followed Rupert Miles.
Len Sanderson put an equally eloquent case for the Newspaper of the Future – “Electronic, interactive, convenient, on-line and complementary to the current printed vehicle” – illustrated by an impressive presentation which illuminated the paper’s editorial and advertising, through the addition of sound and vision. He anticipated a time when for some the electronic paper maybe their weekday information source; the printed version their weekend reading. The electronic paper would offer advertisers depth of information, interactivity, and the possibility of more effective targetting and regional flexibility. “All companies must respond or die”, concluded Sanderson.
The presentation demonstrated very effectively the multimedia opportunities of the future – media owners could no longer work in isolation to achieve this, as Len Sanderson accepted during the question time. (Larger allegiances would have to be formed). However, as Jonathan Shier pointed out later it was difficult to see where the newspaper as we know it ended and the (tele) vision began.
David Mansfield, Group Commercial Director of Capital Radio, saw a future for radio with one presenter’s output being fed to hundreds of stations, whilst behaving locally. He would control the advertising breaks and promotions himself. The station would pay no money for the service but would barter airtime in return for the service which is packaged by the supplier into individual sells. This is already happening in the USA. Earlier Mansfield had explained the complicated regulatory arrangements with regard to station ownership, and welcomed the launch of Classic and Virgin, and the coming third station.
Jonathan Shier held the conference’s attention with a sharply delivered delve into the global TV picture. His views on the current scene:
BBC –
Must articulate its message or mission
ITV-
Will remain brand leader through the 90s.
Research and development will make or break ITV.
C4 –
Has proved that perception is crucial in the new media world.
C5 –
There is a gap in the market for a national channel with local opt-outs.
As to the future he is in broad agreement with Zenith’s view of cable and satellite penetration – conveniently equal by the year 2000 – but “cable is the future”, and Rupert Murdoch knows this, said Shier.
The new players must understand that “broadcasting is retailing”, and in future the broadcasting business will be changed by the new technology which is likely to allow videos to be sent down existing phone lines. It is the company which owns the video signal (which has more capacity) that will win, Shier added.
The size of the future players was graphically illustrated – Time Warner is the largest audio visual company in the world, but BT is three times its size. It is the communications company who will be the future key players – either owning, or working with, today’s media owners.
A view, he concluded (not his own) is that in 20 years there will be no advertising on television. With everything on demand through video why should anyone watch the advertisements.Murdoch has got it right with the heavy bias towards subscription revenue and the ability to retain his newspapers to promote his broadcast empire.
By 1999 channel subscription revenue will be equivalent to the total terrestrial TV advertising revenue.
Gillian Pollach, Director of Media Audits, reviewed the media scene in Europe and drew several comparisons between Spain and the UK. Spain, she said, is a more mature market than the UK in terms of competition. Buyers are able to use real market information; they must live on their wits. In the UK we rely on market price, which in itself is the subject of some mockery at this moment.
Referring to recent speculation, Pollach was firm in her belief that “bringing back Net Revenue would be a backward step”.
The first morning was concluded by the client, John Cheese, who has just announced that he is leaving his position as Marketing Director (Personal Sector) at Barclays Bank. He welcomed the greater use made of creative media, brought about by budget cuts, and hoped it would continue post- recession. He also applauded the increased editoral/advertising ratio over the last three years. Some publishers, he felt, “had become a little greedy with the premiums they placed on colour” – there were large variances across the national press. His own company had cut back their TV spend over the recent difficult years – it would be useful to have more research to show the relative effect of reducing TV budget.
In the future, he warned that concentration of ITV ownership would lead to a loss of regionality, and welcomed the mixed funded approach on the BBC.