Why ITV can’t deliver 21st Century TV  

Posted by diary of a madman in , , , ,

So is that a statement or is that a question? Either ITV can not deliver a channel in the 21st Century or why can’t they do it? They have Michael Grade at almost £1million per year at the helm – surely he has the vision, experience and balls to shake up ITV as he did so early on in his career?

And with that opening statement you should see where the issue lies quite heavily - “early on in his career” – Back in the day when he was an innovator and forward thinker around television content with Channel 4 and BBC – his aim was simple and blunt. Create a channel that has an output to cut above the noise of others, drive eyeballs to it and start to knock down barriers and boundaries! You know what he probably did that in spades and earned the respect and trust of his peers and fellow broadcasters while doing so.

However – zoom forward a couple of decades and here we are in 2009 – the world of television is a very (actually must emphasise that a bit more) VERY  different place. Advertising has been on the decline for years, and just as my take on the value of eyeballs of the internet is somewhat a skewed view based on perceived value of those eyeballs – this is the same on television. Back in the day when Grade was making a name for himself the naive nature was as such that television has an audience of XXmillion and this in turn is worth £XXXXXXXXX per 30second slot – and so television advertising became a main stay in campaigns and marketing plans – because of all those eyeballs glued to the screen while their programme was not on the screen!  I have always been very cynical of this approach no matter what medium – perhaps due to the fact that I do not feel the need to go and buy a sofa from DFS because they say that their sale has been extended or that a couple of kids with annoying CGI eyebrow movements makes me go and buy chocolate. This is the same with the internet – mass coverage of banners back in the 90s were a main stay across the web, pop ups (remember them both) however it soon became apparent that this blanket approach was not working and before you know it a search engine realised that if they start to actually target ads based on what an internet user was searching for then that would become “targeted” advertising. Google Ad Words was born and at the same time pop up blockers and ad blockers were the norm – the noise was turned down and in most cases switched off all together… The rest is Google history and everyone has been trying to catch them up ever since..

Now lets use that same example above and specifically with TV and directly at ITV. At the moment there is no exact number of audience figures for programmes and what those behavioural patterns are – so a blanket approach is still used today – and the Advertising Standards Agency ensure that there is no “unfair” advantage so while watching CSI Miami Amazon would not be allowed to advertise the latest CSI Box set – as that is too targeted??!! Excuse me… isn't that the whole point Amazon would quite like to target the people who are watching the programme that they are advertising. So companies would pay money for ad slots from ITV based on the BARB viewing figures from a base of 5,100 households!! What!!! 5,100 – we are a country of over 60million (of which there is 30million TVs) and the viewing figures are based on this small subset based in regions!?!?!

So let me go back to an earlier point… “PERCIEVED”  value of the eyeballs – at least with the web you have stats to say that Facebook has had 24million views yesterday – these are facts that are based on fact and actually we know where they came from and where they went off to next. So did it really come as a surprise to Michael Grade and ITV when they saw revenues fall off a cliff – where smart advertisers were putting their money on web advertising r- which could be targeted and actually get a report based on number of eyeballs and how many converted to either browse the site or in the end purchase. TV could not hold that up as it was still based on what 5,100 households were doing. Once the UK moves fully digital I would hope that we can stop this incredibly expensive (for the advertiser) guessing game – but can you imagine if in the cold light of day we suddenly find that Coronation Street actually only pulled in 3million viewers while Shameless pulled in 11million viewers!! I think there would be some cause for concern if there were actual true representations that skewed these figures.  However the truth must out – and once we are back on a level playing field and we have an actual true picture of the viewing figures then I guess advertisers will start to move back to the television – especially when we can use technology as a pair & matching looking at what Samsung are doing with Internet@TV with Yahoo…

How does this effect ITV and Grade’s immediate future – apart from commercial suicide, has he not learned from his current ad revenue drop – that advertisers are not spending as much on ITV as they used to?? Surely he and his team knows this and can see it?? So if your ad revenue is falling off a cliff – how would you plan to attack that and start to get some monetary value back into your business.

Well we know what Grade has announced..   and to plough more into his reality shows that prove big ratings wins…

..and lets stop right there!! Closing down local regional areas of the business, axing studios and long term drama shows… In a time where we are very much global as well as local centric and aware regional (I’m also not going to talk about Friends Reunited – apart from WHY!!! and what a bad decision to make to buy that site – and yes we were all saying that when they bought it as it had already outlived its stay on the web!!)

However I just wanted to finish of with some final points on how you should go about generating that revenue… Creating monstrous rubbish such as I’m a Celebrity.. X-Factor and other such reality shows – especially those that enlist the “Z-List” of celebrities that may well flank the pages of OK Magazine in the UK – outside of our little island no one cares or gives an ass about who these people are. If your lucky they may get a slot in 10sec clip of the most disgusting thing done in a closed space type show in Australia – apart from that your resell, syndication, distribution, RSVS feeds diminish into £0. These shows especially the reality shows cost very little to produce compared to a drama or sit-com that takes a great deal of investment – but also generates additional and continued revenue. Look at the Friends brand and its revenue and syndication rights continue even today – BBC paid over $22million for Heroes Season1 – and that's just one country.

So as a parting shot across the bow – why can’t ITV deliver 21st Century TV – because the thinking is still stuck in the latter 20th Century and when you are convinced that the advertisers will come back if you produce (perceived) large audience programming the advertisers will return….

…not if they have already spent their money elsewhere on the web with Yahoo & Google as well as Lulu or other online studios that have direct content traffic conversions – while others such as Fox continue to flourish because of continued revenue from syndication rights and license deals of their shows, as well as embracing them online with various multiple distribution points that are tracked and delivered…

Unless the ITV board realise that there needs to be new thinking – ITV will be switched off from out television screens by this time next year….

This entry was posted on 5 Mar 2009 at 3/05/2009 and is filed under , , , , . You can follow any responses to this entry through the comments feed .

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