Free TV channels face battle for survival

Commercial broadcasters battling for viewers with on-demand subscription channels have been given short shrift in the current review of EU broadcast legislation. Strict rules on the timing of advertising slots and limitations on alternative funding models could leave ‘free’ TV channels, which are dependent on advertising revenue, battling for survival.

The outlook is grim. Rigid rules on spot advertising, or those advertisements aired during programme breaks, will probably remain unchanged. In its review of current legislation (Television Without Frontiers), the European Commission had proposed that broadcasters would have to wait 35 minutes before inserting an advertising break in programmes. This period has now been reduced by five minutes to the current limit of 30 minutes by the European Parliament. Broadcasters will hardly be jumping for joy at this minor victory.

Part of the trouble is that traditional advertising breaks crowbarred into the middle of programmes look increasingly outdated when compared, for instance, to zippy web-based adverts. Broadcasters have good reason to fear a flight of advertisers to new platforms. In a world where people can choose to watch what they want, when they want, on digital channels, those clunky ad slots are becoming more and more of an annoyance. All too aware of this, big brand advertisers are not as eager as they used to be to snap up slots. The five-minute concession will not change this.

The advertisers that fund free channels would prefer to see far more flexible arrangements being put in place. Being able to choose more appropriate times for breaks, timed so as not to coincide with those pivotal moments when everyone is glued to the screen, for example, would immediately make broadcasters’ advertising packages more attractive, according to Malte Lohan, public affairs manager at the World Federation of Advertisers. "What we call television today isn’t what we called television ten years ago," he says. "There’s more choice, more platforms on which to access content and a lot of user control. Basically advertising needs to become more engaging and less interruptive."

Product placement, an alternative means of raising funds, could also be subject to strict controls following Parliamentary debates on the matter. The technique, often described as hidden advertising, consists of including a product or service in a programme. MEPs are generally in favour of allowing broadcasters to use the technique, but only on sports and fiction programmes. Product integration, which involves embedding product references within programme scripts, is to be banned outright.

Consumer groups would like to see a ban on all stealth techniques. "Product placement is hidden advertising and should not be allowed," says Jim Murray, director of BEUC, the European consumers’ organisation. A prohibition on product placement in children’s programmes is all well and good, says the group, but since minors spend 71% of their viewing time watching programmes aimed at the general public, protection offered is minimal.

Commercial broadcasters battling for viewers with on-demand subscription channels have been given short shrift in the current review of EU broadcast legislation. Strict rules on the timing of advertising slots and limitations on alternative funding models could leave ‘free’ TV channels, which are dependent on advertising revenue, battling for survival.