Goldman Sachs' Anthony Noto issued bad news for the media sector in a recent analyst report, saying that a U.S. recession-a 50/50 chance, he says, would lead to a downturn in advertising by as much as 10 percent. Of course, that doesn't include Web advertising, which many expect to rise more than 20 percent next year--but it may include more experimental forms of new media advertising, such as cell phones and perhaps, Web 2.0 sites like YouTube and Facebook.
"Clearly, the fringe areas would be much more impacted [by a recession]... the newer areas that have less of a track record in terms of their ability to have a direct marketing impact," Rino Scanzoni, an executive at WPP Group media-buyer GroupM, said. For example, online video--considered a risky investment for advertisers due to content and copyright concerns--attracts .01 percent of the audience generated by traditional television.
Nevertheless, Peter Levinsohn, CEO of Fox Interactive Media, owner of the social network MySpace, isn't worried. In a recession, "advertisers tend to move more toward accountability," he explains. "We still feel pretty good about our prospects."
Too much wacky tobaccy
What are these people thinking??
Firstly, they aren't people, they're news-crazed analysts with theiry eye on creating hoopla and fanfare on their crazy information.
First off 50/50 chance?? 50/50?! Everything is a chance of happening or not happening. Probability was a retarded subject. What difference does it make if there is a third of a chance of something happening, vs an 8th? If it happens in the end, it still was or wasn't going to happen!
Secondly, don't people realise that majority of the population is simplistic? They lead simple lives with common families and common mass market needs. ie. They watch TV, they use the internet and they listen to the radio when dropping the kids off at school. Most people are lazy, they'll do anything they can to sit on their asses. People like passive entertainment and entertainment is going nuts online. The only problem is too much fragmentation so all the little companies are trying to get pieces of the pie. There isn't enough pie for everyone, obviosuly. Some won't make it.
The whole article is just a mess, full of contradictions and conditions for certain market conditions. I also don't think many things will crash. Maybe Facebook's $15B valuation but that was ridiculous to begin with.