A strong ITV is essential to advertisers, but CRR must remain
ITV is still most major advertisers’ biggest and most important single channel to market. Its simultaneous delivery of massive audiences which, despite audience fragmentation, are still far larger than those delivered by any other channel, sets it apart and makes it unsubstitutable for many.
As Thinkbox’s Tess Alps frequently reminds us, TV viewing continues to run at a high despite all the other competition for viewers. ITV has had serious wins with some of its programmes over recent months – shows like X Factor and Britain’s Got Talent have been appointments to view for millions.
Advertisers are rooting for ITV to succeed and will celebrate its success when it does. Even in the digital world, it’s still the biggest player in town – and ITV.com is pretty big in digital too, ranking 61 on UKOM (UK Online Measurement).
Meanwhile, ITV and advertisers await a critical ruling as the Competition Commission concludes its review of the Contract Rights Renewal price control. The CRR was applied to the newly merged ITV because the deal put over half of the TV market in its grasp.
Many millions of pounds’ worth of advertisers’ budgets rest both on ITV’s performance and on the outcome of this review, which ITV has long petitioned for because it believes the CRR damages its business and should be overturned.
CRR must be retained as long as ITV remains dominant, which it does. Its market shares are still well above any level at which competition intervention is triggered. Most of its advertiser customers can only dream of such market power.
ISBA has argued consistently that the benign performance relationship CRR imposes on ITV must be retained as long as it remains dominant, which it does. ITV’s market shares are still well above any level at which competition intervention is triggered. Most of its advertiser customers can only dream of such market power.
Having failed to persuade the Office of Fair Trading and sectoral regulator Ofcom, the matter passed to the Competition Commission. During the process, ITV tabled two alternative proposals to CRR, neither of which offered appropriate reassurance to advertisers. The CC’s decision has now been put back to April, at which time any outcome passes back to OFT & Ofcom for implementation.
As one advertiser aptly put it, “It would be foolish to let the gorilla out of the cage and expect it to behave in a reasonable manner”.
Bob Wootton is ISBA director of media and advertising
