Veronis Suhler Stevenson: 2009 media spending down

Share this content:

Overall media and communications spending is projected to decline by 0.4% in 2009, according to private equity firm Veronis Suhler Stevenson (VSS) in a special mid-year update to its annual Communications Industry Forecast that was developed in response to the unprecedented economic downturn.

Mobile content and digital out-of-home will be among the few bright spots.

The industry is experiencing its lowest growth rate since VSS started collecting data on it 30 years ago. Not only is the continued negative outlook for the economy affecting the sector's overall growth, but there are also some major shifts taking place in the media and communications industry.

Generally, the communications industry segments that will decline in 2009 are traditional media segments that have seen an increase in competitive alternatives, which offer stronger proof-of-performance and ROI metrics at lower price points, according to the report.

"The media, information and education industries have been negatively impacted by the economic downturn,” said James Rutherford, EVP and managing director at VSS, in a statement. “However, as a whole these industries (which comprise the communications industry) have performed better than many other sectors of the US economy, and we are confident that over the medium and long term, the communications industry will regain momentum.”

The VSS research team reviewed hundreds of primary and secondary sources for up-to-date data and trends through mid-February for the report.

The newspaper publishing segment is estimated to contract by 16.2% in 2009, according to the report, compared to a decline of 13.5% in 2008. Broadcast television is projected to decline by 9% in 2009, vs. a drop of 0.5% in 2008. Consumer magazine publishing is expected to decrease by 8.5%, compared to a drop of 6.8% in 2008. Broadcast and satellite radio is projected to drop by 7.2% this year, vs. a decline of 5.8% in 2008. 

Marketing services, including segments such as direct marketing, promotions and branded entertainment, will decline 1.3%.

Advertising spending will drop 7.4% in 2009, the first two-year decline in 75 years as it also declined in 2008. 

While the downturn in the economy has accelerated the downward pressure on the more traditional segments of the consumer advertising and marketing services sectors, several newer segments continue to experience growth, albeit at a slower rate than previously.

The pure-play Internet and mobile services segment was previously expected to grow by 15.5% in 2009,  but VSS now projects an increase of only 9.1% for 2009.

Mobile content and videogames will record 34.2% and 19.5% growth rates, respectively.

Sign up to our newsletters

Company of the Week

Brightcove is the world's leading video platform. The most innovative and respected brands confidently rely on Brightcove to solve their most demanding communication challenges because of the unmatched performance and flexibility of our platform, our global scale and reliability, and our award-winning service. With thousands of customers and an industry-leading suite of cloud video products, Brightcove enables customers to drive compelling business results.

Find out more here »

Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here