Smaller publishing firms 'may go under in economic crisis'

Dubai Job losses and the downfall of smaller print and publishing outfits is on the cards for the regional media sector as it begins to feel the pinch of the worldwide financial meltdown in the months to come.

Chairman of the DCCI Printing and Publishing Group Ahmad Bin Al Shaikh yesterday described the coming repercussions of the crisis as a "clean-up", in which the sector purges itself of "non-professional", smaller printing and publishing companies.

"Definitely some publications will go out of the market. It will be a streamlining of the sector," he said.

Al Shaikh said he did not expect larger media organisations to scale down their operations or decrease their workforce.

"This will not lead to such a big loss because it won't be the large very professional organisations which are closing," he said.

Twenty per cent of the printing and publishing sector's locally produced material is exported regionally and internationally. The companies connected to the international markets are more vulnerable.

Al Shaikh added, however, the pending fallout was not a crisis, but rather a time in which the exponential growth in the region slows down marginally.

"We must realise internationally growth has been between two and six per cent in the last few years, we have been exceeding 20 per cent growth. In 2009 growth is expected to slow down, maybe to the range of eight per cent. Still, compared to international levels it is high.

"We will be losing our abnormal growth, but that does not mean we are in crisis. No way," he said.

Cuts in the advertising budgets of many large companies may also affect the media sector.

General manager of the Pan Arab Research Centre Sami Raffoul said the effects of the crisis on the media sector would be "discrete", emerging only in the next six to eight months.

While acknowledging that advertising budgets would be slashed, Raffoul said they would not disappear completely.

Raffoul conceded that there would be some employee casualties as the crisis begins to pinch.

"Undoubtedly, yes, there may be job losses. But there should not be a great deal of concern over this because I think what will happen is there will be a redistribution of the workforces in the region, especially high and mid-level professionals," he said.

Countries such as Saudi Arabia and Kuwait traditionally have trouble attracting skilled media professionals and the backlash of the crisis may present an opportunity for workers who lose their jobs in Dubai, for example, to move to another country or another emirate.

Raffoul conjectured many companies would begin scrutinising their spending "with a fine-tooth comb" to control unnecessary expense.

Last week, it emerged City 7, a Dubai-based English television channel, and its 130 employees may be among the first victims of the global financial crisis as its owners reportedly evaluated its viability.