Media companies struggling to fund productions
Sixty nine per cent of key media figures are currently experiencing difficulty funding their productions, according to an online survey conducted by business and financial adviser Grant Thornton.
The survey also revealed that 85 per cent of respondents do not have all of their content tied up with one distributor, indicating the growing need to diversify risk during the current economic climate. 89 per cent regarded distribution income as a significant part of their growth strategy. In addition, respondents felt the Asian (72.7 per cent) market to be the most important sales territory, followed by North America (54.5), Europe (non-UK 45.4 per cent) and Australia/New Zealand (13.6 per cent).
According to Christine Corner, media partner at Grant Thornton, the TV industry is facing unprecedented challenges; a sharp drop in advertising revenues against the backdrop of a severe economic slowdown has inevitably impacted companies across the industry and there has been much talk of cost reductions and restructuring.
"Advertising levels are likely to remain flat for the best part of 2010 and the drastic fall in advertising revenues (by between 15-17 per cent in 2009) has led to the need to increase deficit funding. We are seeing a growing trend towards companies seeking alternative sources of funding; including overseas tax credits, advertiser funding and monies from NGOs and companies wanting to promote their CSR messages," says Corner.