NEW YORK, June 24 /PRNewswire/ -- Pointing to significant increases in digital device and service revenue, an overwhelming majority of U.S. communications and media executives see a trend of improving business conditions and a more gradually improving employment picture in their sector for the rest of this year and in 2011, according to the results of a recent survey by KPMG LLP, the audit, tax, and advisory firm.
A total of 83 percent of the survey respondents said they expect revenue increases from digital device / services this year, with 46 percent of them predicting that their revenue growth will be 7 percent or more. At the same time, they view new product introductions, wireless / mobile applications, and digital device platforms as the biggest revenue drivers over the next three years.
Displaying emerging optimism about business conditions, 65 percent of the respondents believe revenue and profitability is better now than a year ago, and 75 percent think both metrics will be better a year from now in 2011. They see sector employment recovering more gradually as 53 percent expect their companies to add headcount this year, while 22 percent project headcount reductions.
"Communications and media executives clearly believe that their industries will resolve current challenges and benefit from the opportunities tied to the rapidly evolving convergence of digital and wireless worlds," said Tony Castellanos, KPMG U.S. Communications and Media National Sector Leader. "In fact, nearly three-fourths of the executives said the deployment of new personal digital devices, and emerging technology that enables new markets, will positively impact their companies much more so than other market drivers."
Strategic Focus on Investing for Growth
When asked in the survey if their current strategic focus was on cost cutting or investing for long-term growth, the executives indicated they were investing for growth by a 2 to 1 margin. The vast majority of the communications and media executives who said their companies were cost cutting nevertheless cited new product introduction as a key revenue driver in the coming years.
Keys To Sector Recovery
While communications and media executives don't expect full recovery of the U.S. economy until early 2012, they anticipate their sectors will recover sooner. They see that sector recovery tied to consumer confidence, hiring and availability of capital. Almost 70 percent said improved consumer confidence is the most important trigger for economic recovery, followed by an increase in hiring as a result of improved business conditions (59 percent), and improved access to capital (46 percent).
The survey results also provided insight into how executives see the relationship between sector economic triggers and market drivers. According to the results, executives who cited "consumer confidence" as the most important economic trigger are most likely to believe that new product introduction is a key revenue driver, while executives who identified "increased hiring" as the most important trigger are most likely to believe that wireless / mobile applications are key revenue drivers.
The KPMG Communications and Media Industry Survey
The KPMG survey was conducted in April - May 2010 and reflects the responses of 81 CEOs and other C-level suite executives in the communications and media industry. Of the 81 respondents, 38 are with companies with revenues exceeding $1 billion, 24 are with companies with revenues in the $250 million-$1 billion range, and 19 are with companies with revenue below $250 million. Clarion Research Inc. conducted the survey and compiled the data.
About KPMG LLP
KPMG LLP, the audit, tax and advisory firm (http://www.us.kpmg.com), is the U.S. member firm of KPMG International Cooperative ("KPMG International.") KPMG International's member firms have 140,000 professionals, including more than 7,900 partners, in 145 countries.
SOURCE KPMG LLP