Regional financial media expands as general media slumps
Posted on 08 April 2010 with no comments from readers
The largest Middle East business news and information website AME Info would hardly be up for sale if business life for the regional media was all that good. AME Info depends on advertising for the majority of its revenues, and advertising is well down across all media.
Indeed 2009 was an annus horribilus for the Gulf media in particular. The real estate crash that followed the credit crunch of late 2008 impacted regional advertising very hard. Most media companies lost a lot of money in 2009 as they failed to cut overheads as fast as the fall in revenues.
Expansion plans
It is amazing then to note the regional expansion of Thomson Reuters and Bloomberg in this same period. Are these two global giants of financial data preparing for a new era of economic expansion in the Gulf, or did their managements far away in the West make a big mistake, and expand into a falling market?
Easy enough sat behind a desk in London or New York to think that somehow the Middle East is different to the rest of the world. Besides in corporate bureaucracies a manager who secures money for expansion does not tend to give it up easily.
Why else would Thomson Reuters have added 104 people in the region last year, bringing it up to 520, with plans to add another 100 this year? Bloomberg now has 50 staff in Dubai, and has boosted the number of staff covering the Gulf from Dubai from 12 in January 2009 to around 25, according to the Financial Times.
The same article quoted local rival Zawya as claiming just a two per cent fall in its 5,000 members last year, who pay $5,700 for its full service. Bloomberg did not give a specific number for the installations of its famous terminal but claims installations rose three per cent last year, and forecast a 10 per cent rise in 2010.
Everybody down except us?
These claims do seem heroic in the face of the appalling regional media market downturn last year. It has so frustrated AME Info’s owners Emap plc that the leading business information and news website is flagged as up for sale and open to offers. This electronic media is not doing so well.
It is to be hoped that the recovery in regional financial markets that Thomson Reuters and Bloomberg are gearing up to cover with their huge staffs is forthcoming. But surely last year demonstrated that downturns can happen in the Middle East, just like anywhere else, and actually the real estate crash in Dubai was bloody by any global standards.
Any upturn is regional financial markets is likely to be muted and characterized by liquidations, loan rescheduling and consolidations. Something to report on but not a great deal to get excited about.
