UK broadcast accreditation service TV Eye has been rapped over the knuckles by the Office of Fair Trading over its imposition of unreasonable conditions on the sale of advertising airtime to start-up media buying agencies.
The competition watchdog was alerted to this alleged heavy-handedness by the Institute of Practitioners in Advertising.
TV Eye is owned by commercial broadcasters ITV, GMTV, Channel 4 and Five. It was taken to task for imposing an "unduly strict registration policy on new media agencies; collectively setting the form of security to be provided by agencies to cover the risk of defaulting on contracts with broadcasters; collectively agreeing and enforcing the terms and conditions on which credit would be granted to media agencies (known as credit listing), without objective justification".
The OFT ruled that these practices "placed media agencies in an unduly weak bargaining position with little room for individual negotiation with the broadcasters, and that this dampened competition".
TV Eye has provisionally agreed to suspend such conditions and has assured the OFT it will no longer decide whether an agency has the required "creditworthiness" to negotiate with the broadcasters. It will "simply gather and provide on request, relevant financial information and analysis to individual broadcasters to assist them in making their own commercial decisions".
Says OFT chairman John Vickers: "These revisions will allow a freer, more competitive environment
Data sourced from Office of Fair Trading (UK); additional content by WARC staff