By Scott Longley The slump in advertising shows no sign of abating. Reports are circulating...
By Scott Longley
The slump in advertising shows no sign of abating. Reports are circulating from media buyers that revenues will be down as much as 20% in April with suggestions that things will not be any better in May and June. Much of the decline is being blamed on the demise of the business-to-consumer dot.coms, which boosted revenues this time last year.
ABN Amro media analyst Mike Hilton said that times were tough for ITV companies. He added: "Until we see signs of an upturn both Granada and Carlton shares will stay at depressed levels." ABN Amro also points out that the stream of downgrades from US media companies is making assumptions of a second-half recovery "highly questionable".
Better news has come from the smaller players in the digital radio market. Last week, Radio First announced a five-year agreement with BSkyB to broadcast football-related digital radio stations on the Sky network. This opens up Radio First's service to 4.7 million Sky subscribers. As part of the deal BSkyB will be issued warrants to subscribe for up to 18% of Radio First within the next five years. Analyst Catherine Bond at housebroker Seymour Pierce said that the audience projections of 5% of Sky subscribers was modest and that unofficial research suggests that they could reach 17%.
Also making moves in the digital radio arena is Aim-listed Channelfly.com which was last week named as a partner in Digital Radio Group's bid for the third London digital radio licence. Channelfly, which will hold a 6% stake in the consortium, will broadcast its SBN student radio network on the proposed multiplex. The consortium also includes GWR, Scottish Media, Carphone Warehouse and The Wireless Group.