AOP predicts digital revenues to grow 16%

LONDON - There is optimism online as UK publishers predict a 16% growth in their digital revenues in 2009 despite the downturn, according to the Association of Online Publisher's annual survey.

The survey, the AOP's seventh annual Census, reveals that digital publishers remain pragmatic about the long-term future of their businesses, but are intent on continued investment with 63% saying they expect to increase their digital investment in 2009 and only 7% anticipating a cut.

The Census, carried out from February 9 to March 2, identified downward pressure on advertising pricing and the development of multi-media sales teams as the main challenges faced by publishers in this year's survey.

The survey also highlighted that the revenue model for advertising doesn't appear to be significantly shifting.

Tim Cain, AOP's head of research and insight, said: "Whilst we're seeing CPC increasingly adopted as a pricing mechanism (up 50% year on year) the advertising model is still predominantly led by CPM (89%) and sponsorship (84%), which are also being used more widely amongst publishers."

Digital investment is likely to focus on developing better skilled teams, primarily in the area of offline and online cross-media, which was cited by 51%, and technical infrastructure with a focus on technology and innovation that was mentioned by 28%.

The building of offline and online cross-media teams is one of the main trends to emerge from the study as publishers seek to integrate staff across traditional and digital businesses. As many as 65% of respondents said they expected more functions across departments including advertising planning/research; editorial; product/brand research and advertising sales to be integrated in 2009.

Alison Reay, AOP chairman and digital & multi-media director at the Telegraph Media Group, said: "Given the global trading climate we're operating in, this is a motivating insight into the mood of UK publishers for the coming year - and it's encouraging that they remain focused on developing their offering for their audiences in both B2B and B2C areas.

"AOP members are able to draw on a diverse range of revenue streams, and are less dependent on advertising income only. They are therefore able to offer a strong and credible stance in defending their business position in 2009."

The latest survey has been split into two for the first time. The initial Census report published today provides an overview of the online publishing industry and future planning including business achievement and revenue. The second due to be conducted and published later in the year, will cover content, content delivery, trends, opinions, threats and opportunities.
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AOP members, which between them were responsible for a total in excess of £800m in digital revenues in 2008, include AN Digital, BBC, BSkyB, Channel 4 New Media, Condé Net UK, Dennis Publishing, Economist Group, Financial Times, Guardian Media Group, Haymarket Media Group, Hearst Digital, IPC Media, ITV, News International, Telegraph Media Group, Thomson Reuters and Trinity Mirror.