IPA Hits Out At ITV’s Commercial Rivals
The IPA has accused Channel 4 of strong-arm airtime sales negotiating tactics, saying they have netted the broadcaster up to £65 million in extra revenue over the past year.
The Institute of Practitioners in Advertising, which represents advertising agencies accounting for 85% of UK advertising, has accused Channel 4 of exploiting the contract rights renewal regime governing ITV airtime sales to demand 50% of the ad revenue the broadcaster has lost because of sliding ratings.
At the time of the Carlton/Granada merger that created ITV plc more than two years ago, the CRR was created to try to prevent the network from abusing its dominant market position in UK television advertising.
Under the CRR, ITV agreed to suspend advertising airtime prices at current levels for three years and undertook not to penalise advertisers who reduce their spending in accordance with declining viewing levels.
The IPA claims that Channel 4 and ITV’s other commercial rivals are exploiting the process and may be reducing competition. The body said there was also a “similar laziness” in approach being adopted by some other broadcasters who have also focused their sales policies on simply acquiring a share of the advertising money moving away from ITV under CRR.
The IPA praised ITV for working much better within the regulation in the third year of CRR (to March 31) than previously. The number of guidance inquiries sought by agencies about ITV dropped significantly from more than 100 in the previous 12 months to 68 last year.