Dramatic changes must be effected if the media in Eastern Europe is to cope with the wave of free competition which is characterising the current political changes, according to a report from Carat International – A Guide To Eastern Europe.
The report details the present state of the media in Hungary, Poland, Romania, Czechoslovakia and Yugoslavia, as well as providing a political and market overview. The report highlights that the recent privatisation of many media, and the resultant cessation of state subsidies, has led to a considerable number of the print media experiencing problems. Although a new source of income has been created through increasing advert- ising opportunities, there must be dramatic changes if the most is to be made of this free competition.
Currently, all foreign advertisers have to pay for advertising in hard currency, with barter deals being possible in a number of cases. Most rate cards operate on net prices and do not include agency commission. The report goes on to point out that market research is still highly restricted. The recent political changes in Eastern Europe have allowed freedom of speech to the media which, as a result, are becoming an increasingly important source of information for the population. In addition, the media are striving to provide more interesting and entertaining programmes and articles, often in conjunction with Western media. Parallel to this, satellite dishes are spreading and cable is taking off. Although 1989 and 1990 were difficult years in eastern Europe, 1991 is expected to see a slowing in the rate of decline. In 1992, the IMF expects recovery to at last begin, with an average growth in GDP of 2.8%. This is forecast to increase to an average annual growth of 4.4% over the 1993-96 period.
Although there is almost no monitoring of advertising expenditure anywhere except in Hungary, Carat International estimates the total market for the whole area at $100m for 1990. Advert- ising expenditure is unlikely to stay at its current level of less than 1% of GDP in Eastern Europe, and is actually poised to grow quickly, probably much faster than the economy as a whole.
