Agencies' Fears of 'Confrontational' ITV Are Unfounded

12 June 2006

British agencies' concerns that last year's senior sales management changes at ITV would lead to a more confrontation negotiating stance have proved unfounded, according to the latest annual report from the Office of the Adjudicator at TV and telecoms regulator Ofcom.

The adjudication role was created after the merger in January 2004 of the UK's two largest commercial TV companies (Granada and Carlton Communications) to create ITV.

At that time the merged company controlled over 50% of national TV ad revenues - a dominant position enjoyed by few other broadcasters in Europe or North America.

Fears that this could lead to ITV's abuse of its dominant position were resolved by the Contract Rights Renewal mechanism - a deal between broadcasters and agencies brokered by the Competition Commission and overseen by an independent adjudicator.

In 2005, reveals the report, sixty-eight "guidance enquiries" were filed by advertisers and media agencies and three major disputes were resolved, two in favour of the complainants.

States the report: "In the last twelve months ITV's compliance and cooperation with the undertakings has been satisfactory. However, [its] willingness to comply with the undertakings may be tested during the course of and immediately following disputes, when the relations between agency and broadcaster can become fraught."

The report also note with intriguing ambiguity that although ITV's negotiating stance was "forceful" in the latest series of trading negotiations, the adjudicator had not received "the same type of complaints" as in previous years.

Ever hopeful, ITV ceo Charles Allen, an accountant by profession [and instinct], is currently campaigning for the abolition of the Contract Rights Renewal scheme, complaining that it " handicaps ITV's trading position".

Data sourced from; additional content by WARC staff