• by Masha Geller , August 14, 2001

Sorry to be the bearer of bad news, but 'The Numbers are Ugly.' That was the headline of a release that arrived in my inbox this morning from Myers Reports, outlining revised media expenditures that indicate the economic downturn is even more severe than it appeared to be as recently as three months ago.

According to its new Myers Mediaenomics data, ad spending across all major media will decline 4% this year from 2000. In May, Myers had predicted a 1.5% drop in ad spending.

"Having now seen the broadcast and cable upfronts pretty much play out, we are in a position to more thoroughly evaluate what the year-end numbers will look like," said Jack Myers, chief economist at Myers Reports. "And those numbers are, in a word, ugly. We see no indications whatsoever that the oft- mentioned 'fourth quarter turnaround' will occur, prompting us to issue what is probably the industry's most bearish forecast for this year as well as the next several years."

In addition to the 4% decline in 2001, Myers sees a spending decrease of 1.7% in 2002 and no change in 2003. The most robust year in the firm's six-year projection is the presidential election and Olympic year of 2004, in which Myers sees a 2.7% growth rate, which will then slow again, to 0.9% and 1.0%, in 2005 and 2006, respectively.

Interestingly enough, one area that will show strong growth is that of online media, though Myers said that the online spending forecasts of other firms have been "overly enthusiastic."

"We agree that online advertising will have the strongest growth of any medium for the next several years," Myers said, "but the numbers being thrown around by other forecasters for 2001 and beyond are way out of line with reality."

According to the Myers Mediaenomics projections, online media will generate $4.73 billion in ad revenue this year, up 10% from Myers' 2000 figure. Annual ad revenue growth from 2002- 2006 in the online sector will range from 12-20%.

There's obviously no way of knowing who's right and who's wrong when it comes to the future, but let's hope we'll all be around to see for ourselves.