The adjudicator is the independent person appointed by Ofcom to police the Contract Rights Renewal mechanism. CRR was the price ITV had to pay for the merger of Granada and Carlton. Now Procter & Gamble is asking Ofcom for a timetable for its abandonment. Why?
When Ofcom indicated that it would support the ITV merger, there was widespread concern that a unified ITV would wield too much power in the airtime market. Advertisers, P&G among them, foresaw their ITV prices soaring unless some sort of restraint protected their deals from monopolistic inflation. Hence the CRR "remedy".
CRR has worked well. The first adjudicator, David Connolly, is regarded as having done an excellent job of setting up and running the system.
There have been very few actual adjudications, the parties preferring to - as it were - settle out of court. But perhaps it has worked too well.
Rather like high interest rates dampening down the economy, CRR has dampened down ITV. The danger now, as voiced by P&G's Bernard Balderston, is that unless the shackles are removed at some point, ITV may well fail.
P&G is not alone. Agency voices now question the value of CRR too. Don't be fooled that ITV's customers are feeling sorry for the old beast, they just don't want it to die while it still has a big role to play. Although in disconcerting decline, ITV audiences remain the biggest ratings you can buy and, as such, are of great value to advertisers.
What, then, should Ofcom do? Dump its elegant solution without ceremony?
Cling on to it for dear life? Or come up, as suggested, with a timetable for it to go?
No, not dump it. The resulting jolt to the airtime market would be disastrous.
Cling on? No, the times are changing fast and CRR cannot last forever.
But a timetable? It's rather like Tony Blair's dilemma: he is going to go at some point and has said so. "But when, Tony? When?" they cry. Canny Mr Blair knows that once he says when, he's dead. Once we know CRR will go at, say, the end of 2007, it too will be a lame duck and Ditcham's role hollow. Ofcom must keep CRR under continuous review and manage industry expectations to the point when CRR is quietly, but uncontroversially, put to sleep.
- Simon Marquis is the chairman of the National Readership Survey and the former chairman of ZenithOptimedia.