Taiwan authorities may be downgrading growth forecasts for the overall economy this year, but buoyant turnover and a highly competitive market mean the advertising industry remains Asia's most robust. Government economists have reduced official forecasts for 1998 growth from 6.7 per cent to 6 per cent, but the self-contained market has left the economy in fairly healthy condition. The media is no exception to the general growth trends in the economy. Advertising expenditure grew 32 per cent last year from 1996, and estimates for the first half of this year point to a 31 per cent increase compared with the same period a year ago. Total media expenditure, excluding outdoor and radio, amounted to US$1.8 billion in 1996 and $2.23 billion last year. The half-year total this year is estimated at $1.25 billion. Terrestrial television is the largest recipient of ad spending, with 45 per cent of the pie. Newspapers take 35 per cent, cable TV 11 per cent and magazines 9 per cent. When Formosa TV began transmission last year, it became Taiwan's fourth terrestrial station after Taiwan TV, China TV and China Television Service. The newcomer attracts about 10 per cent of ad revenue with the others drawing about 30 per cent each. Taiwan is the cable TV capital of Asia with about 80 per cent of its five million TV households now watching up to 100 channels. But, although the medium has 50 per cent of the viewership among homes able to get cable, it falls well behind in terms of advertising turnover. Hwa Wei & Grey media director in Taipei, Susan Wang, said that while each channel's individual numbers were small, together they formed a significant number. The terrestrial channel's method of selling airtime also ensured their primacy over cable. 'The rates are the same for every programme, it does not matter if it is high or low. If you want to buy something on the popular evening news bulletin though, you also have to take slots on lower-rated programmes,' she said. Nevertheless, 85 per cent of advertising time on the terrestrials was booked. Another Hwa Wei & Grey executive, Wang Shaw-Hu, said this arrangement had created the strong trend of hiring agencies-of-record. Procter & Gamble used Grey for individual products such as Pringles, but the agency did all of its TV media buying. 'We can get better deals for them because we have a basket of goods to buy for. It's when the relations an agency has with the terrestrials comes into its own,' she said. In the past, the cable TV sector has not helped itself attract clients. Many operators regularly strip out pre-paid spots, especially on foreign-originated channels, replace them with home-grown ads and pocket the revenue. The international arm of Hong Kong's terrestrial Television Broadcasts, TVBS, transmits five channels, covering news and entertainment, making it the leading cable TV channel supplier overall. HBO says its average night-time ratings in Taiwan have made it the island's most-watched cable TV channel. In the prime-time slot from 9pm to 11pm, Monday to Saturday, HBO has a 2.1 rating, 23 per cent higher than the second-highest rated cable channel, TVBS' flagship Superchannel. These findings by ACNielsen (Taiwan) were compiled for the first half of this year in homes capable of receiving HBO. In the newspaper sector, United Daily News (UDN) and China Times have enjoyed a long-standing duopoly of newspaper sales, with circulations of about one million each daily. But in the past three years, newcomer Liberty Times has made an astonishing upwards flight into the top five best-selling newspapers, with advertising revenue doubling last year. What this represents in cash terms is difficult to tell; Taiwanese newspaper executives are pathologically shy when it comes to disclosing figures. Long-standing plans for an official audit of the UDN stable, which includes Economic Daily News, United Evening News and the sports and entertainment title Ming Shing Bao , and of the China Times titles including Commercial Times and China Times Weekly , continually founder because the companies will not participate. This buccaneering state of affairs is likely to end soon if the cabinet-level Fair Trade Commission has its way. In August, the commission issued regulations which order newspapers to state clearly how they calculate their figures, and to provide reliable statistics to back up these figures. Fines up to $1.5 million can be levied under the terms of a Fair Trade Law under scrutiny by legislators as the government tries to create an island-wide audited circulation system.