STORM CLOUDS LOOMING: With a slowing economy and the dotcom dollars drying up, the future for Asia's regional print titles doesn't look too rosy. But they're fighting back with a series of relaunche

The heady adspend days of last year are over. It was only a few months ago that Asia's publishers were popping the corks on a bumper year. Revenues on regional print titles were up by as much as 50 per cent in some cases and ad directors were licking their lips as the cash rolled in. But, fuelled as it was by the free-wheeling, free-spending internet boom, it was all bound to unravel sooner or later. Telecoms, IT, banking and finance were the darling categories of the new millennium. But when technology stocks came crashing down, venture capital dried up, and dotcoms closed down, spends retracted across the board. All media had benefited, and all media has suffered - not just print. "Outdoor was a favourite in some markets," says CIA International Asia general manager Tess Caven. "We worked out that at the height of the madness, nearly 50 per cent of bus advertising in Singapore was taken up by dotcoms." Towards the end of 2000, media owners had begun to look over their shoulders. And their fears have been realised. In contrast to 2000, when research company CMR's ad revenue figures showed Time Asia up by 31 per cent from US$49 to 65 million, and Newsweek Asia up 34 per cent from US$33 to 44 million, first-quarter figures for this year show that total advertising revenue in Asia has increased by just three per cent - with Time Asia showing 0.9 per cent year-to-date growth and Newsweek Asia one per cent. As well as technology, telecoms and finance, other categories like travel and consumer electronics are down, says Caven: "Overall, I think that a lot of clients are holding back and spending on a piece-meal basis." No category is spending heavily. It is not that they don't have the budget, more that they're waiting to see what the US economy will do before they start spending. There is always hope in an economic downturn that companies will use the opportunity of discounted rates to build their brands. More often, advertisers focus on specific local markets in an attempt to concentrate on territories where they feel they can get most value for their advertising dollars. "There is a tendency for clients to retract their spend back to local market advertising in tough times, because pan-regional advertising is less quantifiable results-wise, and an easy thing for country managers to take pot-shots at," says Caven. "If media owners are in a position to split their feeds or localise, they can at least chase local dollars as well as regional." She adds that clients are increasingly looking for local-language options too, particularly in less English-friendly markets like Taiwan, Japan and Korea. MindShare business director, Ralph Szeto, agrees that some clients are moving away from regional media: "In Q1 and Q2, clients selected target markets and local media, not pan-regional media. Regional is seen as being for an elite group. "Budgets are down because of the overall gloom, which has made clients concentrate on individual markets. Driving sales is more important in a downturn. Companies still want to build a brand but they don't want to spend on it now." According to CMR, the revenues of Asiaweek, which relaunched on May 11 as a technology and business lifestyle publication, rose by just 11 per cent last year compared to 2000, and dipped 15 per cent in the first quarter of this year. Its rival the Far Eastern Economic Review rose by 42 per cent in 2000, and a further 25 per cent in the first quarter. Asiaweek's new look has attracted mixed reviews. "It is a big change, and it's now much more differentiated from Time Asia," says Szeto. "It is more Asia-focused and will interest our clients more. It's a good direction to go in because it can attract both local and pan-regional spends. The editorial is attractive, and in terms of flexibility it is a split buy." By contrast, another media director claims that the title had abandoned its brand equity as a respected regional news magazine, and gone too far down the "dotcom-Wired meets George meets Red Herring route". He adds: "There was even an article in one issue about how to tie a Windsor knot - how insulting to their existing upscale audience that they have hitherto flouted so proudly." However, Asiaweek associate publisher, Rick Gates, says he's confident that the relaunch will contribute to meeting the magazine's year-end targets, despite the economic climate. "This is in response to changes in the Asian consumer. There is a whole new group of entrepreneurial Asian consumers. These people are breaking the mould. They are driven by technology and business, not politics." Other publications have tried to tap into the technology lifestyle trend, but none as wholeheartedly as Asiaweek. "We are now more of a technology and business read," says Gates. " We're different because we're talking to Asians about Asian personalities and Asian trends." Another title that has changed, albeit subtly, is The Economist. While not making any radical editorial departure or deliberately aligning itself more closely with Asian markets to attract split-buy spends, the 158-year-old title has, in its own conservative way, made a break with the past. "It has been so well implemented and accepted that it's hard to remember what it was like before," says CIA's Caven. "It certainly makes it more approachable for many new and existing readers." The Economist still has ground to make up on competitors such as BusinessWeek. But its first-quarter figures are tentatively encouraging: a 0.7 per cent fall in advertising, compared with BusinessWeek's 20 per cent drop. BusinessWeek has been hit by the fall in US technology and automotive advertising. The title is trying to grow its non-traditional clients, in areas like travel and finance, and introduce new sections, one-off reports and incentives to book. "We are trying to hold our rates, but flexibility is built in where necessary," admits Business Week Asia managing director Alan Lammin. "Currently we are 10 to 15 per cent down on 2000, and about the same amount up on 1999." Time Asia and Fortune are also looking at adding Asia pages. "The slowdown hasn't hit Asia so badly, so we are making up shortfall through Asian pages," says Time and Fortune president, Andrew Butcher. He adds that the company is looking for new sources of revenue in China and India. Time Asia also publishes a trimmed insert, On, that focuses on technology. "It is developing as a reader franchise, and we are beginning to increase it," Butcher says. "There is no question that technology will be the driver of both business and lifestyle for the next quarter of a century." Newsweek Asia, like its rivals, is looking at its editorial product closely. This month, like last year, it is publishing a special edition dedicated to what it calls "the key issues in Asia". "It has been received well. It is very collectable and is one of the ways we can grow our business," says Newsweek Asia advertising director Teresa Yeung. She added that with Asiaweek trying to reposition itself as a technology-focused title, and Time going in the same direction, it had strengthened Newsweek Asia's positioning as an international magazine. Yeung is cautiously optimistic about the future. "I don't think we'll be seeing another 20 per cent year, but we shouldn't be seeing a fall - and that's without revising my revenue targets," she says. While the drop-off in revenue from internet companies has affected print media, the internet is still around, and it's an increasingly powerful competitor to print for ad dollars. In the context of a less-than-robust regional economy, it's just one of the threats that makes the future of pan-Asian print media an uncertain one. "The year may be on-par, plus or minus five to 10 per cent, if the US and Japanese economies don't belly-flop," says CIA's Caven. "If these go and Europe wobbles, I think that budgets could be held back, and the back-end of the year could be bad." This might be unduly pessimistic, and what we're feeling now might just be a necessary counter to the unsustainable, technology-fuelled growth print titles experienced during 2000. Whatever happens, one thing's for sure: it won't be as good as last year again for quite a while.

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