Ad Spending Turns the Corner

The outlook for total U.S. media advertising, after a rough 2008 and an abysmal 2009, will bottom out in 2010 with total projected spending of $163 billion.   This will represent the lowest annual total since 1999, with the recent sharp economic downturn accelerating the migration of advertising dollars from traditional to digital media.  In the past, marketers were comfortable sending huge sums of ad dollars through traditional channels to maximize reach, despite knowing that the majority of consumers seeing their campaigns were unlikely to purchase their product.  The dramatic reduction in total available ad dollars has forced marketers to revisit traditional spending models and led to intensified demand for the lower-cost, more efficient access provided by digital media.

Lower tax revenues cause state and local governments to take another look at legalized gambling

Over the past fifteen months, as the U.S. and world economies have navigated through one of the most difficult economic periods in nearly a century, governments at every level, local, state and national, have felt increased pressure to revisit their position on legalized gambling and the related tax revenue impact.  Even though some positive signs of an economic rebound emerged during the third and fourth quarters of 2009, unemployment levels remain high, job losses continue and, consequently, consumer spending remains depressed. The result is substantially lower tax receipts for state and local governments at the same time that public expenditures are increasing because of certain entitlement programs.  Since governments are rarely as efficient as private enterprise at effectively lowering costs to cope with such situations, the only other alternative is to raise revenue.  Even the most liberal of politicians are hesitant to raise sales and income taxes during economic downturns for fear of a backlash from their constituents, so governments are trying to get creative to raise other forms of revenue and stimulate economic expansion.  One option that is now being discussed more frequently with many more proponents than in the past is the legalization of gambling.