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Pastimes : Clown-Free Zone... sorry, no clowns allowed

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To: Lucretius who wrote (62441)1/28/2001 5:56:36 PM
From: Mark Adams  Read Replies (1) of 436258
 
Just some tidbits to keep the bearish flame alive; below is a heavily edited extract of a report on the state of advertising.

Media & Entertainment – 26 January 2001 (Continued)

We are increasingly concerned about the deteriorating trends within the US advertising market.

... we are now seeing signs that large advertisers are exercising cancellation options for upfront commitments.

Following a sharp decline in the health of the advertising market in the fourth quarter of CY00, trends thus far in CY01 appear to be getting worse. Given the abundance of overall weak economic signs coupled with a seemingly unending number of companies that have reported (or pre-announced) weak Q4 profitability, it should hardly be a surprise that advertising growth continues to wane.

While many have argued that advertising is not cyclical, i.e. insulated from economic factors, we would argue that in the near-term, companies under pressure to meet earnings estimates are likely to cut back on advertising as a first response.

Unfortunately, the current picture is bleak – and appears to be getting bleaker. We believe that GM is exercising its maximum cancellation option on network commitments of 50% of broadcast television.

Automotive and retail have joined dot-com as weak advertising sectors.
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