Regulation and technology continue to play a key role in the television market, whilst concerns over consolidation remain prevalent.
As regulation and consolidation continue to play an important role in the television market, ISBA continues to influence a number of reports, decisions and consultations, with significant advertiser input. Changes made in 2011 by media regulator Ofcom to its Broadcasting Code, now permits product placement, opening up new opportunities for broadcasters.
As the uptake of web-enabled TV devices proliferates, advertisers attempt to identify the associated creative and commercial opportunities available. However, the volume of planning tools being developed in the area serves to confuse the notion of universal industry metrics.
Issues currently being discussed within the television industry include:
The speculation of a potential government sell-off in early October 2015 with a leaked document being photographed outside No.10 prompted ISBA, on behalf of its members, to contribute to a document commissioned by Channel 4. To view the ISBA response to House of Lords - Select Committee Channel 4 Sustainability Apr 2016, please click here.
At the beginning of May, Sky announced that it would be handling Channel 5’s £250m TV ad sales business from June 1st. Sky has effectively extended its existing deal with Viacom, which acquired Channel 5 last year, to represent the TV ad sales for its portfolio of channels until 2020.
As airtime sales has concentrated thus, so the delivery chain for commercials has become slightly more complex. Advertisers should give attention to which channels they are using and how their commercials are distributed to those channels. For a summary and suggested action, click here.
TV Inflation has been a key issue for ISBA’s Audiovisual Action Group and members continued to show appetite for understanding how the TV landscape and trading situation is developing throughout Q1 and looking into Q2 of 2015. Click here for further information.
At the beginning of 2013, BARB, the body that conducts television audience measurement in the UK, made some changes to its rate card and terms. These included some necessary tidying up to prevent certain companies (and even potential competitors) avoiding payment to access BARB data. You can download a briefing paper here.
In December 2011, Ofcom published findings of its UK TV Ad Trading Review and decided not to refer the market to the Competition Commission for a market investigation. The Review found no clear evidence of harm to consumers – whether TV viewers, advertisers or end users of products advertised on TV.
The final decision not to refer to the Competition Commission was excellent news for advertisers who were unenthusiastic about a reference, expressing concern over the likely cost and burden. A Competition Commission Review was estimated to last around 18 months – the maximum would be two years.
ISBA members can find out more details here.
One of ISBAs most significant legacies is the introduction of the Contract Rights Renewal price control mechanism, linking the share of budgets ITV can command from advertisers to its audience delivery. ISBA urged its imposition when the two sales houses Carlton and Granada merged in 2003, to form ITV plc.
Despite recommendations made by the Office of Fair Trading (OFT) to the Competition Commission (CC) that CRR
should be relaxed in 2009, the CC decided to keep the pricing mechanism, recognising
advertiser and agency concerns that ITV
clearly continues to have significant market power. The CC rightly acknowledged that developments since its inception in 2003, such as time-shifted and high definition channels, could justify some variation. ISBA
collaborated with the OFT and Ofcom
to implement suitable adjustments to CRR
. ISBA members can find out more details here.
In July 2010, Ofcom undertook the decision to remove rules governing the way TV advertising was sold to media buyers and advertisers. Despite some objections from broadcasters, the Airtime Sales Rules were scrapped from September 2010.
The rules were split into two parts – the ‘Withholding Rule’ and the ‘Conditional Selling Rule’ - both intended to ensure fair and effective competition. Advertisers expressed their disappointment and concern at the decision. However, Ofcom said it will monitor the effect of the removal of the rules and warned that broadcasters engaging in "anti-competitive conduct" would face "enforcement action".
Throughout 2010, the House of Lords Communications Committee conducted an inquiry into the (economic) regulation of TV advertising. Following the Committees’ call for evidence, ISBA
provided both a written and verbal response to the inquiry. In February 2011, the Committee published its findings and made three key recommendations; removal of CRR
, replaced with “binding undertakings” from ITV
to invest proportions of any additional revenues from advertising into creating UK-originated programming and training; harmonisation
of advertising minutage
at an average of seven minutes per hour (same as all public-sector broadcasters (PSBs
); and a “short, focused” review of the television trading system, conducted by a "small expert panel".
ISBA dismissed the Lords’ report suggesting that investment in quality content is not a direct substitute for CRR. The Department for Media, Culture and Sport (DMCS) also rejected the House of Lords’ calls for CRR to be abolished, stating its removal would likely result in higher prices.
However, DCMS endorsed Ofcom’s wider review of the television advertising market that was announced at ISBA’s Annual Conference in March 2011. Ofcom’s Chief Executive, Ed Richards, stated that “the time is right to consider whether the current trading mechanism prevents, restricts or distorts competition in the sale of TV airtime.” If the regulator concludes there is a cause for concern, the case will then be referred to the CC to examine. ISBA has responded to Ofcom’s consultation questions, offering the views of its members
The television market has experienced sales house consolidation amongst the sellers of commercial TV airtime as the number of major sales houses have fallen from seven to four in the past two years. Concentration within ITV, Channel 4, Five and Sky, has raised concerns over competition, which ISBA continues to remain close to.
As the future of audiovisual media becomes more digital, with the increasing adoption of web-enabled set top boxes and televisions, there is greater need to provide more accurate information about the increasingly ‘connected’ audience.
BARB, the organisation
traditionally responsible for providing the official measurement of UK television audiences, is progressing with a new measure of TV viewing on PCs
, laptops and tablet devices, following the introduction of a web TV-viewing meter to UK households. However, the concept of a standardised
online video metric is increasingly becoming distorted by the volume of similar planning tools either already in existence or in the process of being developed. ISBA members can find out more details here.
After several rounds of consultation, legislation passed to permit paid Product Placement on broadcast media, allowing media owners to access a new source of revenue. Ofcom has outlined the regulations that are to govern the practice with the publication of its new Broadcasting Code rules with respect to Commercial references in television and radio programming. ISBA members can find out more details here.
The European Commission announced plans to revise an “interpretative communication on certain aspects of the provisions on televised advertising
” to incorporate new issues relating to the new legal framework. The doc, adopted in 2004 and revised in 2007, applied to the old TV Without Frontiers Directive. The communication is non binding. The revision will aim to take into account news forms of commercial communication defined by the AVMS Directive. ISBA members can find out more details here