Online gambling ads can’t save ITV from turmoil
April 10th, 2009When gambling advertising was allowed on British television from September 1st 2007 one broadcaster in particular had cause to celebrate.
For ITV this was a highly significant ruling as it gave them a revenue stream which other channels would not benefit from in the same way and the BBC couldn’t tap into because of its public service mandate.
As the largest privately owned television station in the UK ITV with it’s recently formed extra channels sat back and watched the gambling adds and millions of pounds in extra advertising revenue roll in.
Of course ITV is the UK’s largest commercial public service broadcaster, watched by more than 80% of the population every week. The core channel, ITV1, is a mixed-genre public service channel providing a range of programme genres. ITV invests some £1 billion in programming every year, far more than any other commercial broadcaster in the UK.
However in recent years the channel has stumbled from one controversy to another as it has tried to introduce more gaming and quiz TV.
While the levels of televised gambling advertising have remained steady during the economic downturn the same cannot be said of other sectors and as a result ITV today announced that they are in serious trouble.
The station has announced that it is cutting 600 jobs across its businesses, and plans to make other “significant” savings.
The announcement came as ITV reported a loss of £2.7bn for 2008 after a huge write-down in the value of its assets.
About 150 of the jobs will be lost in Leeds with the closure of its Kirkstall Road studio, which makes programmes such as Heartbeat and The Royal.
ITV, which has been hit by a sharp drop in advertising revenue, also plans to sell the website Friends Reunited.
Excluding the write-down in the value of its broadcasting and online assets, Britain’s biggest commercial broadcaster reported a profit of £167m, down 41% on 2007.
Chairman Michael Grade said: “Current conditions in the advertising market are the most challenging I have experienced in over 30 years in UK broadcasting.”
ITV’s advertising revenue has fallen with the growth of niche commercial channels and the internet.
The company estimates its net advertising revenue for the first quarter of 2009 will be down by about 17% on the same period last year.
Blaming the growth on online advertising ITV chiefs may be more reliant than ever on the gambling industry to help them ride the current wave of economic depression.