14 May 10

ITV fails in final bid to abolish CRR

The Competition Commission this week (12.05.10) dashed ITV’s remaining hopes that it would be allowed to raise charges for advertisers.

The CC said in its final ruling that the broadcaster was too powerful for price controls on its advertising sales to be removed. The restrictions were imposed in 2003 when ITV was founded by the merger of Carlton and Granada. Faced with plunging revenues and strong competition from satellite and digital channels, ITV asked in January 2008 for the controls, known as Contract Rights Renewal (CRR), to be lifted. In May last year the Office of Fair Trading agreed with ITV and advised the Competition Commission to abolish CRR. But the commission said in September last year that it was not minded to do so.

Diana Guy, chairman of the CRR review group, said yesterday: “ITV1 remains a “must have” for certain advertisers and certain types of campaign. Despite all the changes in this market no other channel or medium can come close to matching the size of audience that ITV regularly provides. “There has been virtual unanimity among the advertisers, media agencies, commercial broadcasters and trade bodies we have heard from that CRR should be retained in some form. We believe that ITV has overstated the cost and distortions imposed by CRR.” Ms Guy said that the broadcaster had a unique ability to deliver audiences of up to 18m. She gave approval for ITV to launch the time-delayed channel ITV+1 and the HD version, with the broadcaster being allowed to incorporate the viewing figures of these channels when setting their advertising rates.