ITV Gets Ruling On Competition

The Competition Commission has made a ruling that will allow ITV to continue to take the lion's share of advertising revenues - but to continue to be scrutinised.
It said this week that the broadcaster's unrivalled ability to deliver large audiences on ITV1 means that the Contracts Rights Renewal (CRR) undertakings are still needed.
These prevent the channel from exploiting its position to the detriment of advertisers and other commercial broadcasters, the Competition Commission (CC) concluded.
The CRR undertakings allow buyers of advertising airtime to renew their existing contracts with ITV, adjusted to reflect the change in ITV1's audience share.
In its final report on the undertakings, the CC has confirmed that the definition of ITV1 in the CRR undertakings will now be varied so that audience share on time shifted (+1) and high-definition ITV1 channels can be included in the CRR calculations.
The CC has also renewed its call for an overall review of the system for selling television advertising.
CC Deputy Chairman and Chairman of the CRR Review Group, Diana Guy, said: "ITV1 remains a 'must have' for certain advertisers and certain types of campaign.
"Despite all the changes in this market, no other channel or medium can come close to matching the size of audience that ITV regularly provides.
"So the essential reason for the CRR undertakings remains: to protect advertisers and other commercial broadcasters from the enhanced market position created by the merger of Carlton and Granada," she said.
She also said that there has been virtual unanimity among the advertisers, media agencies, commercial broadcasters and trade bodies we have heard from that CRR should be retained in some form.
"We believe that ITV has overstated the cost and distortions imposed by CRR.
"When it succeeds in making popular programmes which attract large audiences, CRR does not prevent ITV from reaping the rewards.
"We agree, however, that in order to avoid distortions, the definition of ITV1 should be widened to include +1 and high-definition channels," the Chairman continued.
"Many participants have told us that the system of selling television airtime is far from perfect and we repeat our concerns, also raised in 2003, about the potential anti-competitive effects of 'share of broadcasting' and agency 'umbrella' deals between broadcasters and media agencies.
"We continue to believe it appropriate for there to be a wider review of the whole system for selling TV advertising."
Among other things, the CC found that ITV1 retains the unique ability to deliver audiences of up to 18 million at a time, and in 2009, accounted for 982 of the top 1,000 most-watched programmes on commercial television.
Whilst ITV's share of commercial impacts (SOCI) has fallen since 2003, it remains by far the largest commercial broadcaster with a share more than double that of the next largest commercial channel (Channel 4).
Although the internet and the advent of many new digital channels provide possible alternatives for advertisers, these cannot yet replicate ITV's ability to deliver such large audiences on ITV1.
The internet's growing share of overall advertising expenditure in the UK has been driven by classified advertising.
Expenditure on internet display advertising - which is closest in nature to television advertising - was only a fifth of television advertising expenditure in 2009.
(BMcC/GK)