MEDIA FORUM: How digital changed the media landscape in 1999. With all this merger mania around, one or two people in the media business could be in for an extremely brief Christmas break. Along with all things digital, consolidation loomed large in the i

By ALASDAIR REID, campaignlive.co.uk, Friday, 17 December 1999 12:00AM

There was a digital angle to almost everything in media over the course of 1999 - the year which will be remembered for the fact that Emma Thompson provisionally named her new baby, jane.com. It had to happen - and Emma has to be congratulated for stealing such a prominent place at the leading edge of the zeitgeist. Marks off, though, for not allowing digital interactive coverage of the delivery.

There was a digital angle to almost everything in media over the

course of 1999 - the year which will be remembered for the fact that

Emma Thompson provisionally named her new baby, jane.com. It had to

happen - and Emma has to be congratulated for stealing such a prominent

place at the leading edge of the zeitgeist. Marks off, though, for not

allowing digital interactive coverage of the delivery.



This was the year in which BSkyB and ONdigital started offering free

digital set-top boxes, and Open, the interactive domain on the Sky

system, also launched. Digital was the issue that prompted a re-

examination, undertaken by the Davies Committee, of the future funding

of the BBC. And, if you stretch a point, it was also a major factor

behind a wave of consolidation, both mooted and actual.



In a world where traditional network TV faces an uncertain future,

mergers have looked a good way to hedge a few bets - and where the

sellers of airtime are consolidating. From a global perspective, the

biggest TV merger was between CBS and Viacom, but the UK could have its

own version with Carlton Communications and United News & Media already

having declared their intention to tie the knot. The complication is

that ITV’s third major power, Granada, could still be an uninvited guest

at the wedding. The proposed merger between Flextech and Telewest will

also have intriguing implications should it go ahead.



On the agency side of things, there were many proposals, modest or

otherwise, but only one union with possible short-term implications for

the balance of power among media companies - the merger between Leo

Burnett and MacManus.



In the UK, that could eventually see the amalgamation of three

specialists: Motive Communications, MediaVest and Starcom.


But the evolving ITV situation has to be the biggest talking point of

the year. Bob Wootton, the director of media and advertising affairs at

the Incorporated Society of British Advertisers, thinks so: ’It’s a

pretty big way to end a year or a century or a millennium, for that

matter. The BBC has been a long-running area of concern with us too -

and the fact that the BBC admitted it had a huge hole in its funds,

which in turn led to the establishment of the Davies panel, is a major

milestone. As for digital and interactive and online advertising, I

would say the defining characteristic once again has been the contrast

between the high level of hype and the variable nature of the delivery.

Generally speaking, companies towards the more futuristic end of the

spectrum should do more to meet their promises or, dare I say it, bring

their promises down closer to their ability to deliver.’



Was the proposed ITV consolidation alarming news for the rest of the

commercial TV market? Not necessarily so, Andy Barnes, the commercial

director of Channel 4, argues: ’They’re not doing it to become a great

British media company now, are they? Let’s face it, they’re never going

to form another Time Warner. They are doing it to take more money from

the market. But if the rules change to allow a single ITV sales house,

that would also allow us to join forces with others. That has to be seen

as an opportunity.



Aside from that, there were two massive events in TV - the decision to

move News at Ten, which wasn’t as successful in audience terms as ITV

would have liked, and the appointment of Greg Dyke as the director-

general of the BBC. The BBC has been in turmoil and it will take at

least 12 months to turn around, but he is incredibly bright, he has

total support within the BBC and has a mandate for change. That has to

be a powerful combination.’



For Jim Marshall, the chief executive of MediaVest, the MacManus merger

with Leo Burnett looms large in his assessment of the year’s events. He

agrees that the digital arena has dominated industry thinking but argues

that it has had its disappointing aspects. Marshall says: ’The move to

offer free set-top boxes was pretty significant and we’re already

looking at 15 per cent digital penetration by the end of the year - but

I’d have to say that, from an advertiser’s point of view, the issue of

interactivity has still to be addressed properly and digital television

may turn out to be merely about more viewing fragmentation. The lessons

for the advertising industry may well be that individual commercials

will have to work harder. I don’t want to sound like one of those people

who think that things were so much better in the past, but maybe ads

have to be better.’



Marshall also believes it wasn’t the best time for a row to erupt in the

press market - a few weeks ago, three Birmingham newspapers owned by

Trinity Mirror were found to have been producing fraudulent circulation

figures. ’It is continuing to create bad blood in the newspaper industry

and it affects agencies and a lot of advertisers. It focuses our

attention on accountability within the industry and could have far-

reaching implications,’ Marshall predicts.



It was, perhaps, unfortunate that the newspaper industry, which arguably

had a quiet year, drew attention to itself for mainly negative reasons.

But Carolyn McCall, the deputy managing director of The Guardian and The

Observer, doesn’t see it in those terms.



She says: ’Of course it’s hugely embarrassing for Trinity Mirror from a

public relations point of view but I can’t agree that trading currencies

have been undermined. Looked at overall, the Audit Bureau of

Circulations has been continually improving, and the National Readership

Surveys is delivering more than ever.’



McCall argues that, far from having a quiet time of it, the newspaper

business has had a ’watershed’ year. She says: ’The internet has been

massive news for newspapers this year. It has been behind huge revenue

growth - double digit growth in our case - for the newspapers themselves

and we’ve been launching dotcom businesses ourselves. We now have a

network of websites (run under the Guardian Unlimited banner) that are

all becoming businesses in their own right. All the major newspaper

players have internet businesses. We’ll look back at 1999 as the year in

which we really moved ahead in this area.’



This article was first published on campaignlive.co.uk

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