MQT: ITV Must Scrap CRR
ITV must get rid of the Contract Rights Renewal, take a good look at its programming and scheduling and appoint an inspiring leader if the broadcaster is going to survive in the modern world.
This advice to the broadcaster emerged at MediaTel Group’s annual Media Question Time event, held in London last night.
“[ITV] does need a breath of fresh air,” said Jim Hytner, group marketing director of Barclays. “I feel sorry for the people at ITV who just want some inspiration.”
Richard Eyre, chairman of the IAB, argued that ITV had to get rid of the CRR. “The television industry has got to let them get rid of CRR otherwise they will just lop the top off ITV,” he said.
“That is priority number one for the new chief executive,” he continued. “The chief executive equally won’t get any support from the advertising industry unless he or she guarantees them that he or she is going to maintain the programme budget and not just slosh money into the hands of a private equity company or into fund managers.
“You’ve got to say ‘I guarantee that we will spend a billion pounds on programming in the next three years’, and if that costs you your job in three years or one year then so be it. It seems the only way to go that in order for the advertising community to say ‘ok, we value that promise, we are prepared to back it with our advertising support’, at that point you retain an ITV that can give you premium ratings.”
He concluded: “It seems to me that as a marketing tool, ITV is unique. It delivers more audience at one moment than anything else that you can buy in the UK, that’s remarkable and I think worth preserving.”
Phil Georgiadis, founding partner of Walker Media, was also highly critical of the CRR. “There’s a massive issue at the moment, which is because of CRR if you wanted to support ITV in their quest to drive better programming, investing more with them can’t generate a better return because they have no more return to give,” he said from the floor.
“Normally if you invest more you expect to get more, they can’t give you more. Getting rid of CRR is a good idea with one big proviso or health warning: agency deals have to come under the scrutiny of Ofcom first,” he continued.
Georgiadis said that agencies were nervous of scrapping the CRR. “If you’re faced with trading with ITV without CRR, you’re in a very weak negotiating position,” he said. “ITV represents 40% of the revenue at the moment [including the likes of ITV2 and ITV3] and it knows that the agency dealer cannot walk away from 40% of the revenue and say ‘I don’t want to trade with you’.”
He continued: “We’ve got this strange situation… agency deals need to be re-examined, they need to abolish the primacy of the agency deal. At that point ITV will be able to take more money from the market for better return and accept that on some advertisers, they’ll get less for a lesser return and the real market dynamic would exist, and the benefits of higher reach and high ratings and great new programmes on a Sunday night would be rewarded, but not by everyone.”
Richard Eyre felt that the broadcaster had lost confidence in its programming, and that its troubles affected the entire television industry, whilst Hytner thought that programme commissioning is ITV’s biggest problem. “When I was [at ITV], the commissioning editors were becoming very old fashioned and out of date,” he said. “At ITV if you said to talent or even the commissioning editor ‘we want to start on ITV2, ITV3… then it’s going to go to ITV1’, the commissioning editor, never mind the talent, will go ‘oh god no that will be awful.’ The talent would refuse where now that’s actually the real world and that’s what they should be doing.”
Hytner also said that he felt ex-Ofcom boss Steven Carter would get the top ITV job. “I’d like Ed [Richards, now head of Ofcom] to say to Steven Carter ‘You got ITV in to this mess, you get them out of it’ when he takes that job.
Eyre was critical of the communications regulator. “I think Ofcom don’t regulate enough,” he said. “Having been a regulator three times you might find that hard to believe but I think that they are very easy going. ITV decides it would like to do less public service broadcasting because they’re in a difficult position and Ofcom let them.
“The point of having a regulator is every now and then to say we the public don’t like what the market is doing, we don’t like the fact that it’s heading towards the lowest common denominator programming,” he added.
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