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"We continue to foresee long-term growth across most segments but at a slower pace, as the economy adjusts to new realities."
—--James Rutherford, EVP, Veronis Suhler
COMMUNICATIONS INDUSTRY FORECAST: PARTLY CLOUDY
This Year Will Suck, Next Year Will Suck Less
If people didn’t like to read predictions of the future, Miss Cleo wouldn’t be rich and there would be a lot of TV weather forecasters on the streets.

With that in mind, we perused media merchant bank Veronis Suhler’s 15th Annual Communications Industry Forecast (CIF) so you won’t have to. And believe us, we’re wishing that we didn’t have to either.

The bank’s CIF is the most comprehensive tracking of consumer and institutional use and advertising spending trends. For its purposes, the consumer market includes cable and satellite TV, box-office admissions, video/DVD rentals and sales, recorded music, newspapers, books, magazines, video games and Internet access.

The bad news first: Spending on business-to-business magazines will decline for the first time in a decade, thanks to Dubya’s slowing economy, the death of the dot-coms and smaller budgeting by advertisers. Great news for those of us in the b2b mag trenches and hoping for a raise. Veronis Suhler foresees a spending recovery in 2002, with a growth of 6% after a 7.1% drop this year. We’ll believe it when we see it.

Also, consumer spending will slow this year before rebounding next year. Veronis Suhler expects a nearly 7% growth rate from 2001-2005, with spending hitting $168.4 billion in 2005.

Radio advertising is expected to be down slightly, 0.7% in 2001 versus last year. It is predicted to land at $5.2 billion in national spot expenditures and $20.3 billion in 2005.

The good news: Uh, yeah. Let’s just say that it’s all relative.

Says James Rutherford, Exec. VP and head of investment banking at Veronis Suhler, "Americans became so accustomed to aggressive, unprecedented growth over the past five to seven years, which far outpaced GDP growth, that the recent slowdown has generated considerable doom and gloom reaction. In fact, we continue to foresee long-term growth across most segments but at a slower pace, as the economy adjusts to new realities. This is especially encouraging for lame-ass trade rags with websites."

Check back in four years to see if they were right… if we’re still here.

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