No love lost between ITV and advertisers as regulator calls for 'vigilance' on pricing

ITV has been rapped over the knuckles by the media regulator's referee, who adjudicates in disputes between the commercial broadcaster and advertisers.

Charles Allen's group has become increasingly "inconsistent" in the way it complies with new rules designed to protect advertisers, according to the adjudicator, David Connolly.

Mr Connolly was appointed by the regulator, Ofcom, to make sure that ITV, formed by the merger of Carlton and Granada last year, did not abuse its newly dominant position by forcing up advertising rates.

His criticism comes as broadcasters - including ITV - prepare to call on the Government to scrap plans to give the BBC more power.

In his latest six-monthly report, Mr Connolly said that ITV had become less "co-operative". He noted there was concern at alleged threats of reprisals by ITV against those media agencies and advertisers which cut their advertising spend with the broadcaster.

Mr Connolly said: "Concern remains about specific aspects of ITV's behaviour and the adjudicator considers that this demands continued vigilance by his office, Ofcom and the Office of Fair Trading."

According to media buyers, ITV is lobbying Ofcom for an early review of the rules. ITV and Ofcom deny this. Under the Contract Rights Renewals (CRR), ITV must link the cost of advertising on ITV1 - its main channel - to its audience share. Like other terrestrial channels, ITV1 is losing viewers as more households take up multi-channel television. To comply with the rules, ITV must cut the price of its advertising slots.

But media buyers claim ITV has been trying to maintain prices by offering supplementary advertising on its digital channels, ITV2 and ITV3, which are not covered by CRR.

Matt Blackborn, the executive buying director at Starcom Mediavest, said: "ITV has worked out the boundaries which it can push. Where there isn't absolute clarity on the CRR rules, ITV has tried to exploit this and bring into play its digital channels. But you can't blame it because ITV1 is struggling."

Separately, ITV and Channel 4 are preparing responses - due in at the end of the month - to the Government's proposals outlined in the Green Paper on the future of the BBC. They will call for greater restrictions on the state-funded broadcaster.

ITV and Channel 4 are concerned over recommendations that the BBC Trust - the proposed replacement for its board of governors - be given the power to introduce new services and channels or to change the remit of those that already exist.

Ofcom would carry out a market impact test to assess the changes, but the trust itself would decide whether to go ahead with them. Under the existing rules, ministers make such decisions.

One source close to Channel 4 said: "It's unrealistic to expect the trust to be objective in issuing new licences for services."

Also this week, when it reports its annual results, the radio and magazine group Emap will be come the latest media company to highlight faltering demand for advertising. Its report comes as concerns over the UK economy deepen. The owner of Kiss FM and FHM magazine is expected to meet profit targets for the year to March, but Deutsche Bank analysts are estimating negligible growth in the current year.

Simon Baker, an analyst at Société Générale, said: "The market will be seeking reassurances that the economic slowdown is not flowing through into the performance of [Emap's] UK consumer magazine division."

Its radio division in particular would be suffering in line with the rest of the sector, he said, but the division contributes less than 10 per cent of group revenues.

Media buying agency Starcom has been revising down its estimates for total advertising spend in the second quarter of this year from an initial prediction of 2 per cent growth. It now forecasts a 2 per cent fall.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
News
ebooksNow available in paperback
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Marketing Services Manager - (communications, testing, DM)

£32000 - £35000 per annum + benefits: Ashdown Group: Marketing Services Manage...

Guru Careers: Finance Account Manager

£Neg. (DOE) + Excellent Benefits: Guru Careers: A Finance Account Manager with...

Ashdown Group: Java Developer - Hertfordshire - £47,000 + bonus + benefits

£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...

Ashdown Group: Direct Marketing Manager - B2C, Financial Services - Slough

£45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...

Day In a Page

Homeless Veterans appeal: 'You look for someone who's an inspiration and try to be like them'

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Could cannabis oil reverse the effects of cancer?

Could cannabis oil reverse effects of cancer?

As a film following six patients receiving the controversial treatment is released, Kate Hilpern uncovers a very slippery issue
The Interview movie review: You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here

The Interview movie review

You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here
Serial mania has propelled podcasts into the cultural mainstream

How podcasts became mainstream

People have consumed gripping armchair investigation Serial with a relish typically reserved for box-set binges
Jesus Christ has become an unlikely pin-up for hipster marketing companies

Jesus Christ has become an unlikely pin-up

Kevin Lee Light, aka "Jesus", is the newest client of creative agency Mother while rival agency Anomaly has launched Sexy Jesus, depicting the Messiah in a series of Athena-style poses
Rosetta space mission voted most important scientific breakthrough of 2014

A memorable year for science – if not for mice

The most important scientific breakthroughs of 2014
Christmas cocktails to make you merry: From eggnog to Brown Betty and Rum Bumpo

Christmas cocktails to make you merry

Mulled wine is an essential seasonal treat. But now drinkers are rediscovering other traditional festive tipples. Angela Clutton raises a glass to Christmas cocktails
5 best activity trackers

Fitness technology: 5 best activity trackers

Up the ante in your regimen and change the habits of a lifetime with this wearable tech
Paul Scholes column: It's a little-known fact, but I have played one of the seven dwarves

Paul Scholes column

It's a little-known fact, but I have played one of the seven dwarves
Fifa's travelling circus once again steals limelight from real stars

Fifa's travelling circus once again steals limelight from real stars

Club World Cup kicked into the long grass by the continued farce surrounding Blatter, Garcia, Russia and Qatar
Frank Warren column: 2014 – boxing is back and winning new fans

Frank Warren: Boxing is back and winning new fans

2014 proves it's now one of sport's biggest hitters again
Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas