IPA asks OFT to look into ITV's acquisition of GMTV

LONDON - The IPA is demanding that ITV's attempted acquisition of GMTV be referred to the Competition Commission if it attempts to amalgamate its sales operation.

ITV is in the process of buying Scottish Media Group's 25% stake in the breakfast television franchise for £31m -- it already owns 50%, with the remainder owned by Disney.

However, in its submission to the Office of Fair Trading, the IPA said it is concerned that if the acquisition is permitted, any merger of the GMTV sales operation could allow ITV to increase the price of its airtime. It therefore wants the OFT to get assurances from ITV that it will continue to run a wholly separate GMTV sales operation before giving the green light to the purchase.

GMTV only attracts about 2% of net advertising revenue, which amounts to about £62m each year, but is of particular importance to advertisers, such as toy manufacturers and breakfast cereal manufacturers, that target niche audiences.

It also acts as a cost reducer for agencies, which use it with a combination of other commercial stations as a negotiation tool to get a better deal for ITV daytime.

The IPA said it was concerned there was the potential for ITV Sales to "conditionally sell" GMTV, forcing advertisers into shifting part of their campaigns into ITV daytime.

Jim Marshall, the chairman of the IPA media futures group, said: "Our concern is that it is a sales issue and that ITV will further strengthen its position.

"For certain advertisers that target children and housewives with children, GMTV is an effective cost-reducer. If ITV gets hold of it, we're worried they'll put the prices up so we want the sales points to remain separate."

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