Complacent newspapers battle twin threats in Korea

<P>After years of what industry insiders term complacency, Korea's newspaper titans are facing a fight for survival. This year at least, the evidence is mounting that the landscape is fast approaching a critical juncture.</P> <P>Critically, media reforms are posing a twin threat: on the one hand featuring a potential relaxation of government controls on television advertising sales; on the other, the enactment of controversial legislation that could favour small titles at the expense of the country's larger newspapers.</P> <P>Traditionally, newspapers - specifically the three dominant dailies, Chosun Ilbo, Joong-Ang Ilbo and Dong-A Ilbo - have existed as the preferred advertising medium, leaving brands with little choice when faced with decisions on where to place their advertising budgets. </P> <P>But, since the early 90s, print's share of advertising expenditure has dropped from 40 per cent to just 24 per cent last calendar year, as estimated by Korea's adex monitoring body, KDD, or Hungul Data.</P> <P>Amid this shift, the Korean government has proposed offering financial assistance to help smaller print media owners - some say because of displeasure with criticism from the big three. While the legislation was rejected by Korea's Constitutional Court, many believe this is the first stage in a media reform process that will ultimately weaken the dominant dailies.</P> <P>While print adex has faltered, television advertising levels have enjoyed a healthy climb since 2002; terrestrial television now garners as much as 30 per cent of the nation's overall adex annually, while cable and online media continue their solid growth, albeit from a smaller base. </P> <P>Advertising airtime for the incumbent terrestrial TV players KBS2, MBC and SBS is currently sold at a set rate through the government body, the Korea Broadcast Advertising Corporation, with no discounts available. </P> <P>However, there is no guarantee the body will remain in perpetuity; if discounts do - as expected - become available, TV can expect an adex surge.</P> <P>According to many analysts in, the big three have little to cheer about. </P> <P>"Newspapers in Korea have only themselves to blame for their current malaise," says Neil Drewitt, a Hong Kong-based marketing consultant. "They've operated a sellers' market even in lean years, and have done little to market themselves beyond traditional relationship selling. </P> <P>"Indeed media in Korea is among the worst and most complacent in Asia, in spite of the availability of perfectly good research," he adds.</P> <P>"The top three or four Korean daily newspapers in particular have historically attracted a disproportionate share of adex by operating a cartel" .</P> <P>Industry watchers strongly believe that the three dailies must begin cooperating with the smaller players in marketing the potential of the channel as a whole if they wish to weather the upcoming story. </P> <P>Few, however, expect this to happen. Should the twin threats become a reality, then engendering a new spirit of cooperation will be the least of the big three's worries.</P>