LEADER: Asia will feel pinch of China's strength

<p>All things considered, Asia appears to have gotten off quite </p><p>lightly by comparison to most Western markets this year. </p><p><BR><BR> </p><p>Redundancies, closures, down-sizings and reduced earnings were a fact of </p><p>life for much of the region in a year many would sooner forget. But at </p><p>the end of the day, while the shock of the September 11 attacks was </p><p>immense, the economic pain was never as deep as it has been in the US or </p><p>even Europe. In most major Western markets, a rebound in advertising, </p><p>the first sign that a recovery is underway, is only expected to happen </p><p>in late 2002. </p><p><BR><BR> </p><p>Contrast this with Asia. In some of the region's more resilient, read </p><p>that to mean protected, economies - chiefly China - the bigger problem </p><p>was media inflation. Then again, China does sometimes function quite </p><p>contrary to market conditions. The unilateral decision to cancel </p><p>television advertising contracts in Shanghai late into the year is </p><p>perhaps the most potent demonstration that the mainland is at times a </p><p>law unto itself. The bigger question is how will media inflation fare in </p><p>the new year? Things could go either way, but there are a number of </p><p>factors to believe that China could pull another rabbit out of the hat </p><p>for the media industry </p><p><BR><BR> </p><p>Not least is the mainland's very deliberate effort to strengthen its </p><p>media businesses even as it opens the door, only slightly, to foreign </p><p>competitors. On top of consolidating its TV stations, China is now </p><p>attempting to do the same to its unruly cable TV market through </p><p>state-owned China Cable Network. A US$5 billion war chest should </p><p>go a long way in dominating the cable sector. Fewer players can only </p><p>mean that rates have just one way to go - up. </p><p><BR><BR> </p><p>Plus, China's seemingly resilient economy continues to pull in investors </p><p>and a bigger share of regional advertising spend. That should help </p><p>regional spending rebound, as Zenith Optimedia predicts, but it could </p><p>also spell a tougher year for the rest of Asia. </p><p><BR><BR> </p>