Talks to commence over CRR alternative

LONDON - Talks aimed at finding an alternative to contract rights renewal are to begin in earnest between advertisers and ITV, with the Office of Fair Trading this week refusing to deny that it had been officially approached by the broadcaster to review the mechanism.

The OFT said it could not comment on reports because of "market sensitivity", but industry insiders believe it is poised to announce a decision, possibly in the spring, on whether it will take action.

The broadcaster is confident it can get a review of CRR, despite comments by Ofcom chief executive, Ed Richards, at the Incorporated Society of British Advertisers (Isba) annual meeting last week, when he appeared to rule out an immediate review of TV trading in the UK, while stressing a decision lay with the OFT.

ITV claims there has been a "mood change" among advertisers and rival broadcasters about CRR's "negative" impact on the TV market..

Media Week broke the news that ITV wanted an end to CRR in May 2005, but it was not until last summer that commercial director Ian McCulloch claimed it was making ITV1's business model "untenable".

At the time, Isba came out with a statement strongly backing the system, saying that CRR "remains crucial to securing effective competition for advertiser budgets".

However, a spokesman for the industry body said advertisers were now willing to listen to alternatives.

Bernard Balderston, associate director of media at Procter & Gamble, the UK's biggest spender on TV and a member of Isba's TV action group, said the time had come for ITV to put firm proposals on the table. He said: "The fact that Michael Grade has spoken to the City and Isba has taken the wraps off something that has been whispered about for months.

 "I'm sure advertisers will be willing to listen, but the onus is on the media owner to come up with alternatives because, currently, advertisers are protected by CRR."

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