ITV Rivals Discuss UK Ad Sales Consolidation

10 October 2003

Talks have begun in earnest to create a giant UK television airtime sales operation to rival that of network ITV.

Terrestrial broadcasters Channel 4 and Five; satellite operator BSkyB; IDS, which sells advertising for multichannel stations owned by Flextech; and Viacom's UK channels – all are locked in negotiations about pooling their sales operations.

Earlier this week, the government approved the merger of ITV's two dominant shareholders Carlton Communications and Granada without forcing either to spin off its sales house [WAMN: 08-Oct-03]. The result will be an entity controlling over 50% of the nation's television advertising market.

Ad groups responded with warnings that rival broadcasters would seek to merge their sales houses to keep up. ITV's competitors had discussed this possibility before the government's decision, and are now in urgent talks about it.

"The discussions are a lot more intense now," one insider commented. "The question is whether egos can be set aside in favour of commercial reality."

Should a deal be reached (and it would require a change in ad regulations to go through), just two airtime sales groups would control British TV advertising – a scenario marketers are dreading.

Meanwhile, staff at Carlton and Granada's sales houses are bracing themselves for redundancies. The two units between them employ around 700 staff, up to 300 of which could go after the merger.

Data sourced from: multiple sources; additional content by WARC staff