Raymond Snoddy on Media: ITV Must Live with Ratings-Linked Ad Deals

Marketing, May 25, 2005 | Go to article overview

Raymond Snoddy on Media: ITV Must Live with Ratings-Linked Ad Deals


According to the headline writers, there really can be no doubt that ITV is 'poised for showdown' over the Contract Rights Renewal (CRR) process.

In fact, the only surprise is that poise of any kind is involved where CRR is concerned, and that open hostilities have not broken out already.

Granada and Carlton may have had to agree to that condition to ensure that their merger went ahead, but at the time they would have sacrificed almost everything to get the deal away. You didn't expect them to mean it, did you? Surely the advertising industry is not expecting ITV to honour a deal entered into such a long time ago, before Celebrity Love Island - or even Celebrity Wrestling - were gleams in a controller's eye?

With stellar programmes like those in the schedules, could any reasonable person have really predicted that ITV1's ratings would just continue to slide? Anyone can see that agreeing to CRR was one thing, but actually permitting the advertising industry to reduce its share of spending without loss of discounts in line with plunging ratings is clearly quite another.

There would be something wrong if ITV executives were not suggesting that the CRR mechanism should be modified to take account of the viewing figures of the new digital channels.

When ITV plc talks to the City, the argument goes along predictable lines. The viewing share of ITV1 may continue its inevitable slide as multi-channel advances, but add back the viewers watching ITV2, ITV3 and, soon, ITV4, and hey presto, the performance of corporate ITV is not quite as bad as it might have appeared.

The advertising industry will simply have to recognise these fundamental truths and learn to be a bit more flexible, for goodness' sake - or else.

Actually, it is not like that at all. Given the history of the relationship between these two sides it is not surprising that the marketing industry is prepared to believe the worst of ITV. Yet strip out the conspiracy theories and the mundane truth is that CRR is working remarkably well.

Overall, that is what the latest report from David Connolly, the Ofcom-appointed adjudicator, actually says.

He identifies a bit more tension, a little less consistency from ITV, a number of complaints and some worries about the odd whiff of conditional selling involving ITV1 and digital channels. …

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