Online or Traditional Media : Who will win during Recession ?

US economy is in recession. You have heard this everywhere. Now John Simmons in his article Bad news for Big Media says the real question is “how bad will it get?”

According to his article in CNN Money Fortune, If recent trends continue, the outlook is likely bleak for broadcasters, magazine publishers, newspapers, cable operators and the conglomerates that own them.

He explains that the threat is compounded by the fact Big Media companies are losing the battle against Internet competition - Online advertising and biggies like Facebook, Google, Microsoft and Yahoo.

[Goldman Sachs analyst Ingrid Chung used recent history to guide her take on how a recession is likely to affect large-cap media and entertainment stocks. Looking back at the 2001 recession, Chung observes that the media sector outperformed the S&P 500 for a brief time then too. “When the recession began in the first quarter of 2001, results and public statements did not reflect the recessionary impact until second quarter 2001 [financial] results,” Chung wrote in a note to investors last week. “We expect to see the impact on results begin in second quarter 2008. We believe …that as the companies report second quarter results in late July/early August, we will hear statements regarding a broader advertising slowdown, pressuring shares.” ]

Lesson to be learnt : To survive and thrive in bad times get online and overseas.

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