[2008-08-28]  Nation Media Group Posts Dismal Half Year Results
East Africa's largest newspaper publisher and broadcaster, Nation Media Group, half- year profit after tax rose a mere 14% in the six months ended June 2008 mainly due to revenue increase from it Uganda and Tanzania subsidiaries. 2008 open on a bad note with the country faced with a botched general election that was crowned by country wide violence. High oil prices and escalating inflation have not worked well for the Groups revenues from sales and advertisements.

The traditional media industry in Kenya is facing the challenge of a slowing economy and migration of readers and advertisers to the internet. NMG is following cue and has recently improved its online look to make its website more customer friendly. The high inflation rate has also affected the purchase of newspapers or magazines as they are usually placed at the bottom end of consumer’s budget.

The Group introduced a Swahili radio station-Q FM. At the moment the Kiswahili fm radio station industry is crowded with the likes of Citizen and KBC as dominant players.

NMG biggest rival in Kenya, the Standard Group (SG), revamped its newspapers to increase it market share. NMG does not expect this new outlook by SG to have any impact on its market share. A similarly surprising threat was when Nairobi Star introduced free classified advertising. Competition in the media industry is taking a more aggressive turn and NMG will have to up its game to keep its dominant market share.

Going forward the group will concentrate more on its digital division as Internet costs come down by next year due to the completion of the fiber optic network layout. This will mean that consumers will have an easy and cheap access to information via their phones and PC’s as is the case in developed countries. Presently, the annual growth rate of global digital media industry stands at 33% p.a.

Source: NAIROBIST