Local media becomes profitable business in last decade

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Local media has become a profitable business in the last decade in Romania, with a loyal public and direct access to local advertisers, and with local media groups having started to draw the attention of such large customers of advertisers too.
 
The regions in Romania having recorded the most significant demand for advertising were found to be such areas having reached the most significant development pace too, such as: Transylvania (central Romania), Banat, in the west and Oltenia in the south.
 
The local radio market numbers more than 90 stations with total estimated revenues from advertising in 2008 standing at some 40 million euros. Most of independent radio stations fight for advertising with such networks belonging to large trusts as Lagardere, Intact, SBS Broadcasting, MediaPro or Realitatea-Catavencu.
 
Addressingd to a public aged between 20 and 45, Radio Hit from Iasi (eastern Romania) reached 200,000 euros in 2007 turnover, that is a 10 percent rise on 2006. Most of the company’s revenues, some 60 percent, came from local advertisers. Moreover, the radio station in Iasi estimated this year will be even more profitable than last year due to the first three months’ revenues from advertisements having increased by 25 percent compared with the same interval last year. Representatives of the Radio Sky station from Constanta (southeastern Romania) said that the demand for advertising January through March was much higher compared with the same interval in 2006.
 
The local press has consolidated in the latest years. Last week, two of the most important players on the market, European Media Investment (EMI, a branch of the German group ARBOmedia) and Media Sud Europa (MSE, the publisher of the best read regional newspaper in Romania, Gazeta de Sud) have announced they are to conclude a strategic partnership, with a new structure to result.
 
There will emerge thus the most important publisher of local press in Romania, with a portfolio to include 11 newspapers, eight of which to come from EMI and 3 from MSE. The two companies also intend to develop on the TV, radio and online media markets.
 
In terms of the total rating of the titles in portfolio, the main publishers of local press in Romania are EMI and MSE (with a total of 510,000 readers) and Inform Media (280,000 readers), according to Capital weekly.
 
MSE is a group owned by local shareholders, EMI is a joint venture company, while Inform Media runs on Austrian capital.
 
The weight of the revenues from advertising stands at some 60 percent in the case of Inform Media and at 55.5 percent in the case of MSE. The contracts with national customers (operators in the telecommunications field, banks and retailers etc.) represent between 25 and 30 percent of the total revenues from advertising of newspapers belonging to EMI, 29 percent in the case of the newspapers belonging to the MSE and 18-20 percent in the case of Inform Media.
 
The weight of advertisements in the local press, as translated in number of pages, varies between 30 and 50 percent.
 
The best read local newspaper is Compact (which is distributed free of charge in Bucharest), with an average of 262,000 readers, followed by Gazeta de Sud.
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