Torin Douglas: U-turn on advertising is Christmas bonus for ITV

The ITC has granted an increase in advertising minutage, which is great news for ITV but could leave other TV networks fighting over revenue

The landscape of television, much ploughed up during 2000, will soon be altered again. The 10pm news slot, abandoned by ITV and taken over by the BBC, is about to be reclaimed by ITV on at least three days a week – resulting in the first head-on battle of the bulletins on the two most popular channels.

Suggestions that ITV and the Independent Television Commission would change their minds about switching the news back to 10pm once the BBC had made its uncharacteristically swift move have been discounted by both parties.

What no one has explained is why ITV’s quid pro quo for the deal – the highly lucrative increase in peaktime advertising minutes – was allowed to begin more than three months before it moved its bulletin. This early Christmas present allowed ITV to cash in even more heavily on its autumn bankers such as Cold Feet and Who Wants To Be A Millionaire?

It was on September 21 last year that the ITC announced that it had reached a deal with ITV to restore a 10pm news bulletin just days before ITV took the issue to the High Court. In a press statement the ITC said it had “agreed to the restoration of a 10pm news bulletin on ITV as part of a package of proposals put forward by ITV, to be introduced in the new year.” Twelve paragraphs later, on the second page, came the quid pro quo:

“The ITC has also agreed a series of modifications to its rules on advertising breaks which will provide ITV with additional revenue to invest in programmes. These changes include an addition of two and a half minutes to the limit on advertising over the hours of 6pm to 11pm, but the total limit of advertising will remain unchanged. The changes will also apply to Channel 4 and Channel 5.”

This was as remarkable an about-turn by the ITC as the agreement by ITV to restore a 10pm news bulletin – but it attracted far less publicity. For years the ITC resisted pleas by advertisers for an increase in peaktime minutage to offset the rise in airtime costs. At a stroke, under its new chief executive, it had conceded the principle – to most advertisers’ delight.

But the ITC did more. It allowed the terrestrial channels to reschedule their ad breaks, permitting an extra break inside one-hour dramas like Cold Feet and removing the need for breaks between programmes. That helped ITV disadvantage the BBC’s ten o’clock news bulletin by allowing Who Wants To Be A Millionaire? to over-run the 10pm junction and move straight into the Frank Skinner Show, so viewers would be less likely to switch over.

Unlike the other elements of the “package of proposals put forward by ITV, to be introduced in the new year”, the advertising changes were to start straight away. ITV got everything it asked for.

Commercial rivals were taken aback, not least at the total lack of consultation. Channel 4 and Channel 5 get far less financial benefit than ITV from the extra two and a half peaktime minutes a day, and Sky and the other satellite and cable channels, which already had a higher limit, got no benefit at all. Indeed, in the complex world of airtime buying, extra minutage can work to the disadvantage of the less highly demanded channels and anything that benefits the dominant channel, ITV, is likely to leave rivals proportionately worse off.

According to one estimate, the changes could bring ITV an extra &£80m to &£100m a year. Rivals claim this is not extra money coming into the market, but revenue already in the system, switching to ITV from other channels.

One source says the minutage within Cold Feet went up from six minutes to ten and a half. Instead of two three-minute centre breaks during the programme, there were three three-and-a-half minute breaks – with no end-breaks.

The changes benefit advertisers, according to research from CIA MediaLab. Using a computer model, CIA analysed advertising recall in Who Wants To Be A Millionaire?, before and after the minutage increase. The research shows that, with the extra minutage, advertising impact is improved by having more breaks within programmes.

But what does the increase do for viewers? Some claim viewer enjoyment is spoilt by three centre breaks rather than two and that in the long term viewing may be affected. And even if that 13.5 minutes of advertising is within the rules, do viewers really want that much?

The ITC’s director of advertising and sponsorship Stephen Locke says this was an unusual situation and, unlike changes to the advertising code, there is no requirement to seek consultation. He says the changes are well within the 12-minutes-an-hour limit imposed by the European directive, and they were brought in straightaway because they affected other channels, so it would have been unfair to tie the start date to ITV’s scheduling plans.

But what if the ITC were eventually to decide that, with the BBC News already on at 10pm, ITV need not go head-on against the BBC with its bulletin? Must the extra peaktime minutage be forfeited? After the precedent of the past three months – extra minutage without a 10pm news – the ITC cannot turn the clock back.

Torin Douglas Media is correspondent for BBC News

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