Unveiling the Government's plan to implement the EU Audiovisual Media Services Directive (AVMS) - the set of rules put in place by Brussels to regulate the TV industry in the EU - culture secretary Andy Burnham said there was a lack of evidence about the benefits of allowing product placement. Product placement is currently banned on any UK made programmes.
Burnham said: "I have listened carefully to the arguments on both sides around product placement, and concluded that it should not be permitted in programmes made for this country. There is a lack of evidence of economic benefits, along with very serious concerns about blurring the boundaries between advertising and editorial."
An ITV spokesman said the decision "is perverse" and rules out an "important new revenue stream for those who are committed to investing in and making UK-content".
ITV Executive Chairman, Michael Grade, said: "Our audiences are savvier than the Government thinks. It is simply not in our interest to "contaminate" programmes with product placement which would irritate them and prompt them to switch over.
"Given the extraordinary economic pressures ITV, and others, face, we can't let a decision like this simply go through without trying to fight it. We are considering our next steps and I am consulting my legal team as to whether we have a strong case for judicial review."
Last week, both the Lib Dems and the Conservatives, responding to news that ITV is shedding 600 jobs, called on the Government to allow product placement on British-made TV programmes. Guidelines from Brussels suggest allowing product placement as a way of helping broadcasters generate new revenue streams in response to declining TV ad revenues.
Today, Burnham said that while he was "well aware that a number of commercial broadcasters are facing difficult economic times", his preference was to consider "all other avenues" before allowing product placement. However, the government said it will review the position on TV product placement in 2011/12.
In response, Lib Dem Shadow culture, media and sport secretary, Don Foster said: "Ministers claim they understand the crisis facing British broadcasting, but have so far completely failed to provide the real help struggling broadcasters desperately need."
As part of other plans to implement AVMS into UK law, the Government today also called for the video-on-demand industry to form a co-regulatory body that will maintain standards of VoD content.
The body, led and funded by the industry, will take on responsibility for regulating programme content on video-on-demand services in the UK. Under the new rules, all UK providers of VoD services will need to notify the co-regulator that they are providing a service and Ofcom will be given "backstop" powers to deal with serious or repeated breaches of standards.
The third main area of the Government's implementation of AVMS will see satellite television channels from outside the EU, which are uplinked from the UK, being required to have a broadcasting licence issued by Ofcom.
The AVMS directive came into force in December 2007. The UK and all other EU member states have until December this year to implement it in their domestic law. AVMS revises and updates the Television Without Frontiers Directive, adopted in 1989 and amended in 1997.
.jpg)
.jpg)