Taiwan adspend collapses to first quarter's NTdollars 12.6b

<p>TAIPEI: Taiwan's total adspend collapsed by 10.2 per cent in the </p><p>first quarter against what has been described as abnormally high </p><p>spending levels achieved because of last year's presidential race. </p><p><BR><BR> </p><p>Just released statistics from Rainmaker Industrial show adspend of </p><p>NTdollars 12.6 billion (USdollars 383 million) in the first quarter </p><p>compared with NTdollars 14.1 billion last year. </p><p><BR><BR> </p><p>K. F. Lee, chief executive officer of Carat United Media Services, </p><p>blamed last year's presidential race for the sharp downturn. "Adspend </p><p>for 2000 was high because of the presidential election on March 18 so </p><p>this year is low in comparison," she said. </p><p><BR><BR> </p><p>"The other is that record companies began a boycott of cable TV when it </p><p>announced it would raise its rate card. That was late February." </p><p><BR><BR> </p><p>Rainmaker's figures bear out Lee's observation. In March, Taiwan's cable </p><p>TV spend plummeted by 41.4 per cent compared to the same month in 2000 </p><p>after January and February's double-digit growth. Terrestrial TV also </p><p>took a hit that month, dropping 19.5 per cent, a significantly larger </p><p>decline from the 6.8 per cent and 13 per cent dips of the first two </p><p>months. </p><p><BR><BR> </p><p>Bessie Lee, general manager of MindShare Taiwan, said terrestrial TV's </p><p>woes stem from a long-standing problem. "The government terrestrials - </p><p>TTV, CTS and CTV - have been losing market share to cable TV since the </p><p>mid-90s," she said. "The privately-run cable TV companies have much </p><p>better business sense." In fact, 2000 was the first year that Taiwan's </p><p>cable TV adspend surpassed that of terrestrial TV. This was again true </p><p>in the first quarter of this year. Cable TV's NTdollars 3.8 billion in </p><p>adspend was 30.4 per cent higher than terrestrial's NTdollars 2.9 </p><p>billion. Combined, they account for half of Taiwan's ad revenue. </p><p><BR><BR> </p><p>As for March's drop in adspend, MindShare's Lee described it as </p><p>"seasonal" to a certain extent. "The economic situation isn't so good </p><p>now, and clients usually cut budgets right after Chinese new year." </p><p><BR><BR> </p><p>Another key factor is a slowdown in telecom spending. "Mobile phone </p><p>penetration is nearly 80 per cent. The need for advertising for new </p><p>customer acquisition is no longer there," said Lee. </p><p><BR><BR> </p><p>ESTIMATED EFFECTIVE ADSPEND </p><p>Media 2000 Adex 2001 Adex </p><p> Jan-Mar Jan-Mar </p><p>Unit: NTD'000 </p><p>Terrestrial TV 3,378,498 2,929,123 </p><p>Cable TV 4,336,130 3,818,665 </p><p>Newspaper 4,287,701 3,853,985 </p><p>Magazine 1,530,278 1,488,157 </p><p>Radio 530,599 545,007 </p><p>Total 14,063,207 12,634,938 </p><p>Source: Rainmaker Industrial Ltd. </p><p><BR><BR> </p>