ITV fails to agree ad deals for mobile offer

ITV will roll out its mobile service without advertising revenue following its failure to reach a deal with mobile operators.

In a blow to its plans to turn mobile into a major distribution channel, the broadcaster has been unable to find a compromise over the rights to sell advertising when it makes its content accessible via mobile.

Media Week can reveal that it will make its content available through tie-ups with three operators - O2, Orange and Vodafone.

Its content is currently only available on its dedicated off-portal WAP site, which requires users to pay a more expensive tariff and higher data charges than operators' portals.

According to ITV, of the three deals with operators, one will launch in two weeks, one in one month and one in two months' time.

But because both ITV and the three operators have refused to relinquish control of their mobile inventory, the services will launch without advertising, denying ITV revenue from video advertising and banner ads. The adverts that appear on ITV1 shows will appear when the programmes are streamed to mobile, but advertisers will not pay any extra.

Melissa Goodwin, head of mobile at ITV, said: "There are no ad agreements as yet and we may not manage to reach agreement on all of them. Currently our on-portal plans will not have advertising, but our view is that it is better to go live without inventory."

The stalemate means that ITV's revenue share with the operators will rely on one source: a slice of the cost that punters pay for clips of ITV's footage.

Goodwin was adamant that ITV would not cede control of its advertising inventory, but said that there is room for negotiation.

"We could work it so that we have a period of handling the advertising and then the operator could do it for a period," she said.

Despite the setback, ITV is seeking its first mobile sales manager to sit alongside the broadcaster's head of red-button advertising and head of online advertising.

O2, Orange, and Vodafone refused to comment.

Meanwhile, ITV has extended its contract with mobile ad sales house 4th Screen Advertising for a further year. But Goodwin said that ITV will work to take its mobile ad sales operation in-house within 12 months.

"Next year the big three operators will offer flat-rate tariffs which will lead to 2009 becoming a big year for mobile," said Goodwin.

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