In its formal response to Britain’s Office of Fair Trading, ISBA (the Incorporated Society of British Advertisers) has, as expected, come out strongly against the proposed merger of the nation’s two largest commercial TV companies, Carlton Communications and Granada Media.
Neither broadcaster, ISBA submitted, had persuaded it that the deal would benefit advertisers. The ISBA submission calls for the planned merger to be scrutinized by the Competition Commission for its likely effects on the UK advertising sector – a plea almost certain to be heeded.
Were the merger to go ahead as mooted, ITV would control over 50% of all British commercial TV viewing and around 54% of all TV advertising revenues. “This,” warns the society, “would hand Carlton/Granada an effective monopoly position, giving them excessive dominance in the market for TV airtime for the foreseeable future.”
ISBA also fears the merger would drive the other main commercial broadcasters - terrestrial channels GMTV, Four and Five into a unified sales alliance with satellite giant BSkyB, creating just two sales points for the whole UK television industry.
This would present “a very concerning prospect for ISBA members”, says the body [although it apparently overlooks a possible third force – the two US owned cable operators NTL and Telewest].
ISBA also challenges the assumption by the ITV duo that their marriage would lead to a “virtuous circle” of cost savings … leading to greater expenditure on programming … leading to larger audiences … leading to a better product for advertisers. But “neither Carlton nor Granada has yet put a clear case as to how exactly advertisers might benefit from a merger,” the society complains.
• ISBA's submission was echoed virtually word for word by that lodged the same day by the Institute of Practitioners in Advertising, representing marketing communications agencies.
Data sourced from: MediaGuardian.co.uk and IPA Online (UK); additional content by WARC staff