Group M Forecast Slightly More Optimistic for '08

Projects a Modest Increase in U.S. Spending of 3.7%

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NEW YORK ( -- The blizzard of year-end media forecasts -- like snowflakes, each unique -- continued today as Group M projected a modest 2.8% increase in U.S. ad spending for 2007 and a 3.7% bump in 2008. Global ad spending will rise 6% this year and 7% next year, Group M said.

Those numbers are a bit more encouraging for media companies than some others that have just emerged. Universal McCann's well-regarded forecaster, Robert Coen, this week predicted U.S. growth of 0.7% this year -- which is well below the rate of inflation -- and 3.7% next year. At the same time, ZenithOptimedia pegged U.S. growth at 2.5% in 2007 and 4.1% in 2008.

High on digital
But Group M's report and the others share some basic themes, including the continued ascendance of digital media. Internet-ad spending will comprise more than 10% of global ad spending for the first time next year, according to Group M, which is part of the WPP Group. In one country, Sweden, the web will even collect more revenue than any other medium for the first time.

The ongoing strike by the Writers Guild of America isn't likely to hurt U.S. ad spending, Group M added. But the longer it continues, the more likely it is to hurt network TV while benefiting cable and possibly other media as well. "A prolonged strike could delay pilots and thus impact the 2008 cable marketplace," it said. "An upfront delay would add to uncertainty and nervousness, but might force broadcasters into innovation with new formats."

Group M said next year's numbers will have much to do with the presidential election here and the Olympic Games in Beijing.
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