Kate Bulkley, Media Analyst.

Levelling the ad playing field

By Kate Bulkley

Broadcast News

For Broadcast May 13, 2010

Changes to advertising rules must be acceptable to all - not just ITV.

The Archie and Adam Show - ITV’s latest double act - took to the public stage for the first time last week, at the company’s AGM on 7 May.

But while the country’s voters were bemused by an election with no real result, Norman and Crozier tried to show the TV world that ITV has fresh, clear, forward-thinking leadership.

Did they succeed? Well, Crozier (is it just me or does he look ever so slightly like Nick Clegg?) was about as loquacious as a silent-movie star. To be fair, he is not yet experienced in the running of the company, so his straight-bat presentation was to be expected.

Meanwhile, Norman blustered that he did not want to be “a company constantly complaining about regulation”, and promptly did so for several minutes. That’s the kind of leadership his erstwhile Conservative colleague David Cameron might pin on Gordon Brown.

It’s a good time to challenge him and ITV on regulation, because Ofcom’s independent econometric report on TV advertising issues - including a controversial ad-minuteage analysis - is due out this week.

Currently, ITV, Channel 4 and Five all run an average of seven minutes of ads per hour, while the multichannel broadcasters (including the public-service spin-offs like ITV2) have nine.

Not surprisingly, ITV wants - at the very least - more flexibility to use its minutes wherever it will make the most money (aka peak time).

Meanwhile, the multichannels typically want the status quo; they worry that any change will simply suck ad cash from them and give it to ITV, rather than increase the whole TV ad-spend pie.

It’s an important enough subject that lots of people are already weighing in. In fact, several senior multichannel execs met with Ofcom boss Ed Richards last month to put their case and argue that any increase in the minuteage would be “diabolically awful”, according to one person who was there.

Even flexibility in how and where minutes are used would, in the present system, reward ITV at the expense of smaller broadcasters.

And that is the point. The present system needs to be reviewed in the round, including minuteage, CRR and how to fund public-service content in the future, rather than rushing to fix one bit of the landscape to the detriment of another.

Also, the assumption that analogue switchoff will create some kind of advertising level playing field is unlikely to be correct; ITV will still wield market power unless the whole system is revamped, including a look at agency trading models, ad-share dealing arrangements, media auditors and so on.

TV is evolving and the traditional equation of mass reach to cost-per-thousand doesn’t take into account the value of niche channels and targeting, and advertising around VoD, for example.

Tory deregulation promises are likely to be further down the political agenda given the tipsy mandate from the country over who should be in power - but this is an opportunity to get some more nuance and future-thinking into the ad-sales environment that could benefit all the commercial channels.

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