Views on ad-land from the industry regulator, OFCOM.

23 March 2016
The communications infrastructure is changing and it is changing the way content is consumed. Since its inception OFCOM has been dealing with the issue of convergence. The definition has been changing over the years.

The communications infrastructure is changing and it is changing the way content is consumed. Since its inception OFCOM has been dealing with the issue of convergence. The definition has been changing over the years.  In 2003 OFCOM defined it as merging of different industries and in 2008 OFCOM thought to reassess that definition and asked itself what is convergence in the light of great strides made in the digital world.

In 2016 convergence is more relevant to OFCOM than ever before. In 2003 radio spend for advertising was bigger than the internet and half the TV viewing was via analogue. In contrast convergence in 2016 changed dramatically since 2003 ad tech has transformed the industry that is overseen by OFCOM.

The vision from OFCOM and the few issues that OFCOM is dealing with.

  • Availability of broadband and the struggle of people to get decent broadband coverage

Increase in competitions by encouraging more companies to invest in building an ultra-fast network.

  • Opening up BT infrastructure to encourage new investment
  • Introduction of performance tables which provide consumers information on which providers provides good services
  • Reforming structure of OpenReach

Encourage the telecom sector to

  • Innovate
  • Invest
  • Compete

This will allow for faster and more reliable connectivity.

TV on the other had has proven to be economically resilient. Its resilience is proven by the recent £5 billion it received from advertising. With ad funding remained a crucial part of the UK TV ecology. This has caused the surge is some great content that we enjoy readily. TV is said will stay in our life for years to come. The only threat to TV has arisen form online advertising as advertisers are shifting to online more aggressively. However only is facing its own battles, with ad blocking, viewability ad fraud etc etc.

There are also other effect on the market that needs to be considered and seen as a threat to TV. The emergence of subscription services such as Netflix and Amazon has encouraged meny young people to switch to watching content view these aforementioned platforms. To make matters more interesting some young people don’t know if the program they are watching has been on TV before. This is a relatively new phenomenon and its effect on the market remain to be seen.

Other issues that the market will face will come in the form of regulation from the EU, the rise of new product placement, obesity and debt will renew our focus on the role that may or may not be played by advertising.

OFCOM reiterated the emphasis on opening up BT openreach the IMPORTANCE OF COMMERCIAL TV AND AD FUNDING. Virtuous circle, for now, but noted the shifts to online viewing

1 - ad-free subscription services could overtake broadcasters’ online services

2 - Online video may no longer play to incumbent broadcaster strengths Implications for programme investment and for advertising Comments about AVMS & implications for ad minute rules vs consumption, as symmetry between broadcast constraint and online freedom.

Product placement under AVMS - immersion instead of tie dipping Again, contrast with online Wild West Ofcom engaging on obesity

With rise and improvements of tech relating to infrastructure different AV is becoming more and more interchangeable. There is a vision at OFCOM that There opportunity for the telecom industry is to provide faster broadband and additional services for all.

Content can be consumed anywhere but in essence TV remains robust with regards to advertising, the landscape is changing with the emergence of online and streaming options and consumer tastes are changing rapidly.

You can watch Tony Close give his view on the major issues facing the industry here.

Leave a Comment

Please login to add comments.