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Forecasters Predict Drop in Ad Spending

Two forecasters are predicting declines in advertising spending, though they say signs of a recovery are becoming visible.

"After three big downgrades in a year" of estimates for ad spending in 2001, "our forecasts have stopped growing gloomier," said John Perriss, chief executive at the Zenith Optimedia Group in London, a media services agency owned by the Publicis Groupe and the Cordiant Communications Group.

He predicts a slowdown in the rate of decline, then a resumption of growth, as American ad spending falls 1.5 percent in 2002 from 2001 after falling 6 percent in 2001 from 2000. It starts to rise, he says, in 2003, by 1.6 percent from 2002.

"The terrorist attacks briefly disrupted but did not derail the advertising business," Mr. Perriss said. He is to discuss his forecast in detail this morning at the opening session of the UBS Warburg Media Conference in New York.

The other forecaster is Miles E. Groves, chief economist at the Barry Group in Bethesda, Md., who is predicting that newspaper ad spending will decline 7.7 percent in 2001 from 2000, then increase 2.3 percent in 2002 from 2001.

"Barring any further terrorist attacks, consumers should lead us out of this recession early in the first half of next year," Mr. Groves said, "with business investment doing its share by the second half."

He also estimates a possible increase in newspaper ad spending of more than 5 percent in 2003 compared with 2002.

Berlin Cameron in Talks

About Being Acquired

Berlin Cameron & Partners, a leading midsize independent New York agency, is involved in "very serious conversations" about being acquired, said Andy Berlin, chairman.

There has been widespread speculation that the WPP Group in London is seeking to buy Berlin Cameron and make it the headquarters office of Red Cell, a worldwide agency network WPP formed in January. The online edition of Advertising Age reported Friday that WPP and Berlin Cameron were in "the final stages" of negotiations.

Mr. Berlin said he was talking to several potential acquirers but declined to identify them. He described the offers as "serious and attractive, to us and to our clients," which include Coca-Cola, General Motors and Reebok International. Coca-Cola recently began working with another WPP agency network, Ogilvy & Mather Worldwide.

Berlin Cameron opened in 1997 after Mr. Berlin closed a joint venture with Fallon McElligott known as Fallon McElligott Berlin. He has been a partner in other New York agencies and before that was a founder of Goodby, Berlin & Silverstein in San Francisco, now the Goodby, Silverstein & Partners unit of the Omnicom Group .


ADDENDA, The New York Times December 3, 2001

Copyright © 2001 The New York Times Company. All rights reserved.