2009 will be like 1999 for digital media
October 3, 2008
Sly Bailey, the chief executive of Trinity Mirror, is warning digital businesses to beware of the inevitable bubble-burst. She highlighted how the digital growth of recent years had slowed and suggested there were "tough times ahead".She also renewed her attack on the BBC’s plans to spend Â£68 million (E85.6m) launching 65 local video websites, claiming the scheme could only hamper the development of fledgling digital business and calling it "anti-competitive, unnecessary"."Digital businesses can no longer rely simply on a rising tide of growth. The latest market figures show that the downturn in the economy is now affecting digital media, with growth rates in internet advertising revenue falling in 2008 and the market expected to be more challenging in 2009 and as we’ve seen even Google is not immune," Bailey said."Only the strong will survive. Building new digital audiences is the right thing to do. Attracting millions of unique users to your digital brands is great. But if businesses can’t convert those users to revenue and then to sustainable profit then they will simply run of cash. This is no time for vanity publishing."Our business models have to be sound and our investment plans have to be able to withstand short-term economic shock. I’m firmly of the belief that there will be casualties in the coming months. Remember 1999? Well 2009 will be like Groundhog Day. For the lucky we should expect consolidation and for the less fortunate failure."