Take any TV conference held during the 80s and the subject of
inflation and the need for more competition in the commercial sector
surface as regularly as digital, interactive and audience fragmentation
do today.
The intense lobbying in the 80s - primarily by large, traditional TV
advertisers and their agencies - was partly a genuine desire to find a
mechanism to control inflation but was also a symptom of the desire to
punish ITV for its monopoly and arrogance.
As we approach the millennium, we have the competition that was so
deeply desired in the 80s. But I sense the level of dissatisfaction
among advertisers to be just as great.
There is no evidence that the increased volume of commercial airtime has
sig-nificantly reduced airtime inflation.
Indeed, the extra supply has encouraged a growth in the diversity of TV
advertisers and hence demand for the medium.
Audiences are now scattered across a range of channels and are therefore
available to advertisers in smaller quantities with the subsequent
problems of controlling coverage and frequency distributions.
The plethora of channels available today, growing almost by the minute,
has put a huge strain on administrative systems precisely at the time
when the intense competitive pressures felt by agencies are squeezing
margins. This will manifest itself in a reduced level of service.
The final irony, as far as the major advertisers are concerned, is that
the extra competition in the marketplace has eroded their ability to
command large discounts as premium money - previously used by ITV to
balance these discounts - has largely moved to new and ’cheaper’
channels.
This migration of premium money away from ITV, allied to changes in the
audience profile it has suffered, has resulted in a far more difficult
market than I can remember - except perhaps for the era of retail price
maintenance.
The brunt of these problems is felt by the very advertisers who so
vocally demanded competition in the 80s.
Against this background I find it surprising that the concept
(hypothetical, because of current legislation) of a united ITV with a
single sales point seems to be meeting such opposition.
Perhaps the memories of the afore- mentioned monopoly and arrogance
still haunt certain advertisers. If so, I believe they should be
reassured. The appointment in July of Richard Eyre, the former chief
executive of Capital Radio, as chief executive of the ITV Network Centre
can only be welcomed and a united ITV would be far from a monopoly.
Indeed, I suspect ITV’s attitude to its customers would improve should
its position be strengthened.
In my opinion, it is crucial that the majority supplier of commercial
airtime should be able to act like a market leader rather than indulge
in internecine warfare while the competition cherry-pick revenue.
A united ITV would be able to prevent wholesale migration of revenue
through appropriate sales policies and, if this revenue was correctly
invested, could enhance the quality of its programming.
A single national sell would reduce the burden of administration and
those agencies which have not lost the art of negotiation could see a
return to a situation where their large, well organised clients receive
the value they deserve.
It would, of course, create problems for those buyers whose only skill
is to over-invest in cheaper channels - but then the TV market has
always relied on a balance of winners and losers.
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