TV product placement revenue to be small
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ThE MaStEr
2010-10-21
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TV product placement revenue to be small
BroadcastingChannel 4 and Channel 5 have claimed that revenue from TV product placement will be modest, while ITV holds "clear commercial advantage" in attracting the best deals.
In written evidence to the Lords Communications Committee, Channel 4 warned that the potential benefits of product placement should not be "overplayed", reports The Daily Telegraph.
The Department for Culture, Media and Sport believes that placement of commercial products in British TV shows could be worth up to £100 million per year if the US market can be replicated.
However, Channel 4 said that the revenue would more likely be at the lower end of estimates, probably around £25m over the first five years.
The broadcaster also warned of the potential risk of product placement shifting money away from the more lucrative advertising sources, such as sponsorship.
Passed into law in February by the previous Labour government, the new product placement rules permit recognised brands to appear in popular TV shows, such as Coronation Street and Hollyoaks.
In June, Ofcom stipulated that placement of alcohol, tobacco and gambling products is not permitted, along with high fat, salt and sugar foods. There is also still a complete ban on placement in all children's television programmes.
In a separate submission to the committee, Channel 5 said that product placement will provide a "modest new revenue stream" with limited impact compared to spot advertising, especially in the early years.
Channel 5, which is now owned by media baron Richard Desmond, said that product placement is best suited to particular genres of programming, such as dramas and big entertainment formats.
The broadcaster claimed that ITV will have a "clear commercial advantage" in the market as it is best placed to invest in such genres.
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