ITV faces £100m hit for lost viewers

ITV faces a shortfall of £100m in advertising revenue because its television audience share is declining, according to media buyers.

ITV faces a shortfall of £100m in advertising revenue because its television audience share is declining, according to media buyers.

Under Contracts Rights Renewal (CRR), a code introduced to prevent a newly merged ITV from exploiting its dominance over the commercial television advertising market, advertisers can negotiate lower rates based on how much the broadcaster's audience share shrinks.

Figures from the Broadcasters' Audience Research Board (Barb) show that despite huge recent success with Coronation Street, ITV's share of commercial impacts (one impact equals one person seeing an ad once) for most of its viewing groups is down.

If the decline is maintained over the year, advertisers will be able to negotiate a lower price for next year. Some trade estimates say it could lead to a decline of around 3 per cent in advertising revenues for 2005.

Total annual advertising spend on commercial television is around £3.3bn. With 51 per cent of the advertising market last year, ITV earned £1.7bn, but if its share fell by 3 per cent, this would knock off around £100m in revenue.

Chris Hayward, the head of television at media group Zenith Optimedia, said: "ITV's audience is not as strong as it would like. If it continues like this, ITV could drop £100m."

An ITV spokesman said the figures were overblown. Its average share of adult commercial viewers this year is 41.9 per cent, compared to 42.7 per cent last year. These figures imply a drop in revenue next year of around £30m.

Andy Roberts, the trading director at buying agency Starcom Motive, said: With Euro 2004 and programmes such as 'I'm a Celebrity ...' coming up later this year, ITV hopes its audience share will pick up."