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Ofcom reviews changing TV ad breaks

Ofcom reviews changing TV ad breaks

UK regulator Ofcom has said it will review the time and frequency of TV ad breaks, with results expected later this year.

In a review of Channel 3 (ITV and STV) and Channel 5’s broadcasting licenses, Ofcom said sponsorship and product placement in TV programmes will also be reviewed.

Ofcom stated in the report: “We noted that the regulation of content that is subject to commercial arrangements, such as sponsorship and product placement, as well as rules on the scheduling of advertising on broadcast channels is also relevant to PSB sustainability.”

On scheduling of TV advertising, it said it was looking at “the rules that set the frequency and length of advertising on TV” but recognised these rules are “complex” with stricter limits for public service broadcasters than commercial.

Ofcom has had “initial discussions” with stakeholders, and expects to outline next steps later this summer.

Currently public broadcasting channels can show an average of seven minutes of ads an hour throughout the day, while private channels are permitted nine minutes and then three minutes for teleshopping.

Liz Duff, head of commercial & operations at Total Media said of the review by Ofcom: “This is coming from good intentions. Ofcom is trying to protect broadcasters from the streamers by boosting opportunities for revenue to help them fund production and content acquisition, but this is short-term thinking”

“Increasing the volume of ads pushes us towards the state of the US TV market which is overly cluttered with no stand-out advertising moments – creating a poor experience both for the viewer and for the advertiser,” she said, adding, “The strength of the UK market is the quality of the TV content and of the ad environment. That’s why advertisers spend on TV: they know it’s a high quality environment.”

“While the short-term benefit to the advertisers is potentially paying less per slot, which is important in an inflationary market, the reality is more clutter turns people off. We’ll see lower attention, lower engagement and it may even push viewers away towards the streaming environment – the very outcome Ofcom wants to avoid. Broadcasters need to find other ways to drive that revenue aside from ads, through things like merchandising and product placement which the streamers are so good at. A change in mindset is required, not a change in ad break length,” she concluded.

Ofcom also said it will engage with stakeholders in the industry, the UK Government and other regulators on other matters such as new restrictions on advertising of high fat, salt and sugar products and online advertising.

The report also stated that as viewers and advertising revenues shift to online platforms, “commercial sustainability could come under increasing pressure”, but that this could be strengthened by the adoption of proposed Government legislation to make public service broadcasters’ services and content easier to discover online.

In addition, the regulator said it is conducting audience research to gain a better understanding of attitudes towards “commercial references” in programmes and “the potential trade-off” between exposure to more advertising versus more in-programme branding.

It noted: “Any changes to our approach on commercial references is likely to be seen as a benefit for all broadcasters. We expect to have an update on this work later in the year.”

The same report found both Channel 3 (ITV and STV) and Channel 5 are likely to “continue to make important contributions to public service broadcasting” over the next licence period, collectively spending an average of around £860m a year on a wide range of original network content that meets different audiences needs and interests.

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