Magazine article Marketing

Raymond Snoddy on Media: What's All the Fuss about Capital/GWR Merger?

Magazine article Marketing

Raymond Snoddy on Media: What's All the Fuss about Capital/GWR Merger?

Article excerpt

The advertising world is getting itself into its usual tizzy about the planned merger of Capital and GWR. Sometimes it looks as if you just have to show the industry a bit of consolidation and everyone comes over all faint.

Both the Institute of Practitioners in Advertising (IPA) and the Incorporated Society of British Advertisers (ISBA) have put out ritual statements that they are carefully studying the 'exact' implications of the agreed merger.

At the same time, hands are wrung and concerns expressed about anything that might reduce competition.

Although competition is obviously a good thing, it would be nice if the organisations representing the advertising industry could manage, just for once, to set aside their sectional interests and welcome something that will be good for the whole industry.

A statement from them could read something like this: 'While reserving judgement on the precise competition implications of the Capital/GWR merger, IPA and ISBA jointly welcome such a bold move, one that is so obviously in the interests of creating a stronger commercial radio industry and that should benefit the advertising industry in the long-term.'

The chance of reading such a statement is very low and the usual curmudgeonly performance is likely to continue.

It was just such thinking that led the industry to oppose every step in the consolidation of ITV. Can anyone dare to think what the economics of the main commercial channel would have been now, had the arguments of the advertisers been taken seriously and ITV remained a patchwork quilt of duplicated costs? It's not as if the merger of Capital and GWR can have come as a great surprise to anyone.

It's virtually government policy for a start.

Many advertisers support the merger privately, just as quite a number saw real merit in the creation of one ITV. To the extent that there is a competition issue, it can be dealt with by the regulatory authorities.

The argument that 40% of the radio advertising market should not be merged into one group holds little water. After all, ITV has more than 50% of commercial television and there is no sign of the sky falling in.

Commercial radio has become a strategic medium precisely because of the emergence of national stations and large groups. …

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