ICT Cabinet Secretary Eliud Owalo has called for media outlets to diversify their revenue streams in a bid to reduce government spending on advertising. Owalo expressed concern over the excessive amount of money allocated to advertising revenue and emphasized the need for media organisations to adapt to the digital age and explore new sources of income.
“You cannot continue doing your business the way you used to do before. We are in a digital age and you cannot look at the government as the single source of revenue for the media,” remarked the CS
During a recent address to the media, Owalo highlighted the significant expenditure incurred by the government on advertising, particularly in print media. He specifically mentioned the example of the ‘mygov’ State publication, stating that the government had been spending approximately Ksh.60 million to print it. Owalo went ahead to point out that a state agency could reproduce the publication for only Ksh.3 million.
Owalo emphasized that in the digital era, it was crucial for media outlets to evolve their business models and not rely solely on government revenue. He stated that his actions as the ICT CS must make sense from a business perspective and that continuing to spend large amounts of money on advertising revenue in the digital age did not make sense to him. He expressed his intention to introduce certain changes once he received approval from relevant levels.
“Anything I do as the ICT CS must make sense from a business perspective. I won’t continue spending that large amount of money on advertising revenue in this digital age. It doesn’t make sense to me and once I get approval from relevant levels I will definitely introduce certain changes” announced ICT CS Eliud Owalo.
The call for media outlets to diversify their revenue streams comes at a time when the industry is facing financial challenges. With the rise of digital media, advertising revenue has declined, and many media organisations are struggling to stay afloat. Owalo’s message is a timely reminder that adaptation is necessary for survival in the digital age in order to remain sustainable.
Some suggestions offered by the CS and other Kenyans who offered their feedback include expanding into new markets, developing new products and services, or finding innovative ways to monetize their content.
Owalo’s comments serve as a wake-up call for the media industry to embrace change and explore alternative revenue sources.
“You have to adapt to change. We are in a digital economy. You cannot continue doing your business the traditional way and expect solely to rely on government revenue. You are getting it wrong.” explained CS Owalo
While Owalo hinted at plans to reduce government spending on media advertising, he assured the media that his intention was not to make them redundant. He clarified that the government was not obligated to finance the media and encouraged the press to think outside the box in order to sustain their businesses.
“I don’t see why the government should continue spending the amounts of money that it has been spending on advertising revenue,” said Eliud Owalo, ICT CS. “We are going to re-engineer that space in the not-so-distant future, but we are not against the media.” he added
It is worth noting that Owalo’s remarks follow a similar directive from Trade Secretary Moses Kuria, who instructed government agencies to stop advertising with Nation Media Group. However, Owalo’s focus is on promoting diversification of revenue streams rather than targeting specific media outlets.
The future of the media industry remains uncertain, but those who adapt to change will have a better chance of survival. As technology continues to advance and consumer behaviour evolves, media organisations must be proactive in finding innovative ways to thrive in the digital economy. Diversifying revenue streams is not only necessary but also an opportunity for media outlets to explore new avenues of growth and ensure their long-term viability.