A special committee has been formed to look into the matter of the outstanding amount due to media houses from regional advertising firms, Mohamed S Almulla, Group Executive Director of Arab Media Group, confirmed to Emirates Business.
"A task force has been created comprising members who represent various media owners and their respective media buying units to mutually find a solution to the issue," said Almulla.
Spelling out the details Joseph Ghossoub, CEO and President of The Holding Group, said: "In the past, we have had a few issues like one in Saudi Arabia and we settled them with the involvement of a committee under the Chamber of Commerce of the country. It's worked wonderfully well in the past and its existence has led to a cleaner environment with very few issues in the recent past.
"We intend to replicate the same formula here and have formed a committee that includes representatives from media houses and advertising companies, and together we are confident of settling the issue," said Ghossoub.
He said more than seven of the leading advertising companies – which control almost 80 per cent of the business – are part of this effort. He said the GCC-wide dues figure of "between Dh350 million and Dh450m" is pending settlement, but did not share the breakdown for the UAE.
However, industry professionals said the lion's share of the settlement is for agencies in the UAE.
Advertising spend in the region in 2008 was to the tune of $4.512 billion (Dh16.5bn) in the GCC and $1.986bn in the UAE, according to figures released by Pan-Arab Research Centre (Parc) in its annual report on the media industry in the region. Since then, Parc has seen a decline of more than 13 per cent in the advertising revenue. However, industry professionals put that figure at 40 per cent and are expecting a recovery only in early 2010.
Elaborating on the role of the committee, Ghossoub said: "We intend to have the committee permanently for the future. Its core objectives are to start a dialogue between all the parties concerned and provide a platform for all to seek amicable solutions to any problems in future."
Almulla sought a positive approach to the crisis and hoped that Ramadan will bring additional revenue for the advertising industry.
"In the past few months, noticeable improvements have already been witnessed across most media; including outdoor [which was affected the most]. However, Ramadan media expenditure will play a major role in enhancing the market behaviour and future trends, especially since Ramadan constitutes more than 25 per cent of the annual income in some media [TV]," said Almulla.
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