In Wake of TV Junk Food Ruling, UK Agencies Pull Ads

23 November 2006

LONDON: Following Friday's announcement by UK media regulator Ofcom that it proposes draconian restrictions on TV advertising and sponsorship by junk food and drink brands, media agencies are making contingency plans to pull or switch such spend from TV and into other media.

The new rules affect not only shows specifically targeting children, but also those that attract more than 20% of juvenile viewers. Which, say cynics, on many channels includes the greater part of an average evening's viewing.

The new proposals will not be enforced until the expiry of a consultation period on 15 December, with the finalised rules kicking-in before the end of January 2007. New campaigns commissioned after that point will be required to comply with the new rules.

Meantime, media buyers are frantically categorising the programmes and dedicated channels most likely to be affected by Ofcom's sucker-punch.

The regulator estimates its restrictions will reduce annual TV revenues by £39 million ($74.04m; €57.7m) annually. Buyers, however, believe the eventual figure could be much higher.

  • But it's an ill wind that blows nobody any good. The most likely beneficiaries of Ofcom's move are the online and below-the-line marketing industries.

    Says Simon Bevan, head of TV at Vizeum: "Some [of the shifted spend] will go into digital, but I think a lot of it will go into b-t-l marketing. The worrying thing is that brands that have been traditionally strong TV advertisers are going to be lost to the medium."

    ZenithOptimedia's Chris Hayward is slightly more optimistic. "Certainly I think some of this revenue will be lost to advertising full stop. But in outdoor and in online there are still opportunities, and also in press."

    Azon Howie, director of TV, radio and cinema at Carat , agrees: "Online and outdoor will be big beneficiaries. The big problem is that it is more money coming out of the TV market at a time it can ill afford it."

    Richard Oliver at Universal McCann was more pragmatic. "People knew it was coming," he said. "Every advertiser will have made plans about expenditure that they will take out of TV, although I'm not sure the effect will be massive."

    The media mavens were in accord on one point, however: clients will not risk being seen to flout the new rules.

  • Ofcom, meantime, has a second hot potato on its hands - that of BSkyB's dramatic intervention in the now derelict merger negotiations between NTL and ITV.

    Contrary to Monday's indications [WARC News: 21-Nov--06], the regulator has not washed its hands of Clan Murdoch's seizure of a 17.9% stake in ITV.

    It has invited both BSkyB and ITV to comment on whether the former's acquisition of shares in ITV represents a change of control of one or more of the broadcast licences held by ITV as a corporate entity.

    Were Ofcom to conclude that a change of control had taken place, it would then need to review the effects - or likely effects - of such a change of control on ITV's licensed services. It cites as examples original productions, news and current affairs programmes and regional programming.

    Other influence might also come into play, such as the Office of Fair Trading which is responsible for considering whether there is a merger for competition purposes.

    Likewise, the secretary of state for trade and industry might choose to ask Ofcom to consider whether there are any broadcasting and cross-media public interest considerations, including issues of plurality of ownership.

    Ofcom's current guidance on the definition of control of media companies can be access by clicking here.

    Data sourced from multiple origins; additional content by WARC staff