CRR: “Something must be done about the current state of sterility”

In response to Raymond Snoddy’s column ‘CRR: “Something must be done about the current state of sterility”‘, David Spon-Smith, consultant at Accenture, believes there is no need to single out ITV any longer…

CRR made sense five years ago, but the TV landscape (especially looking forwards into 2011 and beyond) has changed considerably. The main reason for CRR was to facilitate the merger of Carlton and Granada whilst at the same time protect advertisers from an overly dominant ITV.

There have been many headlines surrounding ITV and CRR over the last few years, particularly around ITV trying to remove the shackles of this agreement. In the most part the majority have clearly supported CRR, but recently there has been a growing voice suggesting that perhaps it is time for an overhaul.

The TV market is now split into ITV Group, C4 Group and Sky Group, with a smaller Channel Five group as well. The reality is that we now have three pretty evenly matched players controlling the UK TV market as both Channel 4 and Sky have absorbed VBS and IDS into their operations. It seems potentially difficult to penalize one TV sales network with CRR (i.e. ITV) and not do something similar with C4 or Sky given the strength of these 3 players in the market.

Each sales group brings something different to the table for advertisers and can command a decent presence on any schedule. However, most TV buyers around town will admit to having the toughest negotiations in recent memory, as these three groups look to battle it out over increased share of market and the inevitable price hikes that will accompany this. We have already seen stand offs with some FMCG’s and Sky over VBS pricing in 2010, we could expect to see more of the same in 2011.

The message is that advertisers need to be protected from this media owner ‘chest thumping’, but singling out ITV with CRR seems to be potentially a little unfair.