With the numbers from the Naspers subsidiaries crunched and collated at the head office in Heerengracht Road, it looks like the full benefit of the reorganisation will take a few more years to kick in. But the company’s 2003 annual report has certainly boosted investor confidence.
Total revenue was up 14 percent on 2002, with revenue growth in the subscriber platforms (pay-TV and Internet) up by 17,6 percent. Though the Internet sector showed an increase in revenue from R547 million to R894 million, it still registered a negative operating profit of R244 million. The bleeding has stopped, though. Last year this figure was R464 million.
The problem remains: how to make it pay. Advertising revenue from the Internet remains elusive. The publisher of ITWeb, Jovan Regasek, told Lesley Stones of Business Day that the total amount of Internet advertising revenue was probably less than R60 million annually. This remains an estimate, as the biggest online publishers pulled out of the Audit Bureau of Circulation’s electronic division after disputes about user measurement. Now, the online publishers, including those within the Naspers stable, have formed the Online Publishers Association, which intends to provide some accurate measure of usage within the industry.
Revenue for Media24, the print media division, grew by 13 percent (Johnnic’s grew 10 percent). The general feeling in both camps is that the magazine and newspaper market is overcrowded and stagnant. Caxton’s closure of Pace and the rumours that Bona will follow suit seem to support this. However, the growth in circulation of Media24’s Daily Sun – now somewhere close to 200,000 copies per day – indicates that there are gaps in the market. The decision to increase the monthly TV Plus to a fortnightly publication (with a new editor, Izelle Venter, and new design, nogal) shows a bulllish attitude. Current sales are near the 140,000 mark.
Hardest hit was the book publishing division, Nasboek, which showed only a 3 percent growth, and the private education subsidiary, Educor, which grew revenue by 8 percent.
Internationally, MIH continues to explore the Asian market and saw an 80 percent growth in revenue to R493 million. Their latest venture into new media is an instant messaging service (IMS) called QQ that provides real-time communication from PC to PC and PC to cellphone. With more than 48 million active customers in China, IMS is becoming a popular channel for dating, chatting and browsing. M-Web has now launched QQ.co.za, but it’s still early days for local IMS.
Below the Bikini Line
There are numerous reasons for refusing to pay your bills, but touting your stupidity as one is, well, stupid. According to Marketingweb and various Cape Town sources, a group of advertisers are refusing to pay for adverts that ran in the Sports Illustrated Swimsuit issue, an annual publication from Highbury Monarch Communications. The advertisers say they thought they were advertising in SA Sports Illustrated’s Swimwear issue (published by Touchline Media).
Highbury Monarch Communications has a licencing agreement with AOL Time Warner to publish the Sports Illustrated Swimsuit annual edition in South Africa. It’s an annual publication, filled with American models (in bikinis), into which the publishing group slots local advertising.
Touchline Media publish SA Sports Illustrated, a monthly magazine for sports
enthusiasts that has an annual Swimwear issue with local content and local models (in bikinis). At last count (Jan-Mar 2003 ABC) it was selling more than 38,000 copies monthly.
The relevant media buyers and in-house marketing execs have something to answer for. If you can’t tell the difference between these two publications, you should probably go to bed a lot earlier. Or look a little higher than the bikini line.