AccessMyLibrary provides FREE access to over 30 million articles from top publications available through your library.
Create a link to this page
Copy and paste this link tag into your Web page or blog:
Are those driving adland's boom sector missing a trick?
How inconvenient for Andy Duncan, Channel 4's chief executive. No sooner had City gossip columnists begun whispering his name in connection with the still-vacant chief executive's job at ITV, than he found himself creating headlines in the business pages with a controversy about a structural step-change in the advertising industry.
Duncan was pointing out that Google in the UK was likely to outstrip his channel in ad revenue terms this year. Google is likely to take pounds 900 million, Channel 4 around pounds 800 million. The implications were obvious, weren't they?
Well, no, actually. Senior industry figures were not slow to point out that the central thrust of Duncan's thesis - that the internet has started eating television's lunch - was fundamentally flawed. Total television revenue across the whole market has been holding up remarkably well - and even growing marginally - over the past few years.
So, the rise of the internet does not necessarily equate, in a zero-sum game, to a decline in television. Especially when you remind yourself of one small, but rather important, fact - that the money is coming out of different pots in the first place. They're in very different businesses, Channel 4 and Google. One's still in the classified advertising market, the other in display.
On the other hand, it's useful to be reminded of one rather interesting, but often neglected, consideration - that online media owners are now very much in the big league where their ad revenues are concerned. But are their sales teams similarly top drawer?
1 Google continues in its effortless ability to excite the anger of the UK's media buying community, despite the appointment of Mark Howe as the UK managing director in February. Last year, without prior consultation, Google unilaterally scrapped the traditional 15 per cent commission system, and imposed a sliding-scale incentive scheme designed to give greater rewards to bigger-spending customers. Agencies were not exactly happy about this. When operating in his previous role as the sales boss of the Flextech sales operation, ids, Howe was widely respected for making every effort to work in partnership with agencies and advertisers - and his determination to understand their overall marketing communications goals. Well, he would, wouldn't he, the cynics say. When you're bottom of the pile, you tend to try harder. Now he's market leader in his sector, it's a completely different story. More understanding observers are prepared to cut him slightly more slack - Howe's US bosses, they reckon, leave him little room for manoeuvre.