Advertisers Welcome Report On Contract Rights Renewal
Advertisers have welcomed the independent adjudicator’s decision to monitor claims that ITV is using its dominant position in the television advertising market to force agencies to include ITV2 on their media schedules.
An industry-wide consultation carried out by independent adjudicator, David Connolly, shows that agencies are concerned over the newly merged broadcaster’s leverage of ITV2 as a ‘deal breaker’ when renegotiating their contracts.
Connolly has pledged to keep a close eye on the issue, which was highlighted in Ofcom’s first report on the controversial contract rights renewal system, which was set up to prevent the newly merged ITV from monopolising the market for airtime sales (see Agencies Voice Support For Contract Rights Renewal).
The adjudicator’s vigilance has been welcomed by the Incorporated Society of British Advertisers, which has been tirelessly campaigning for the introduction of tough restrictions to prevent the newly merged ITV from monopolising the multi-billion television advertising market.
ISBA’s director of media and advertising, Bob Wootton, told NewsLine: “We welcome that the adjudicator appears clear that his role and the issues on which he needs to be particularly vigilant continue to develop. ISBA looks forward to continuing to work openly with him and Ofcom into the future.”
The advertising industry body is also keen for Connolly, a former vice chairman at Starcom Motive, to continue to pay particular attention to ITV’s allegedly “rigid approach” to price and share of broadcast where big name brands are switching between media agencies.
However, ISBA recognises that adjudicator’s report is largely positive, showing that the majority of agencies, advertisers and broadcasters believe the complex CRR system is running smoothly and that ITV has generally behaved in a fair and reasonable fashion.
Wootton added: “The report confirms the overall integrity and confidentiality of the contract rights renewal remedy’s operation to date and suggests that the adjudicator’s advisory role appears to have averted formal disputes in several cases.”
Earlier this week it was revealed that ITV could face a deficit of around £100 million in advertising revenue as some of its biggest clients seek to negotiate more competitive terms of trade following the broadcaster’s recent decline in audience share (see Dip In Share Leaves ITV Facing Revenue Shortfall).
ISBA: 020 7499 7502 www.isba.org.uk
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