Advertisers may be interested to learn of the suggestion that they should use their clout to regulate the media in the future.
This follows recognition that advertiser muscle has the ability to influence traditional and online media behaviour and that use of this muscle would be preferable to further government regulation.
In this respect, it is widely acknowledged that it was advertisers and not the government or the Press Complaints Commission (PCC), the soon-to-be defunct regulator, which led to the downfall of the News of the World.
On Monday 26 March 2012, Parliament’s Joint Committee on Privacy and Injunctions published a report which made proposals as to how the media should be regulated in the wake of the phone hacking scandal, following evidence being given by key figures in the media (but not advertising) industry.
The proposals broadly adopt those put forward by the recently appointed chair of the PCC, Lord Hunt.
It puts forward that there be a replacement to the PCC which is independent of government and the media, with the media involved in the drafting of the regulatory code.
Controversially, it is suggested that participation by the media should not be compulsory and that the body should not have a statutory underpinning.
In this regard, the PCC’s voluntary nature has been much criticised, particularly following the withdrawal by Richard Desmond of his Northern and Shell publications from the PCC, and with the phone hacking scandal leading to increased scepticism as to whether the media is capable of effectively regulating itself.
The proposed enhanced regulatory body would provide free pre-publication advice to the media and a complaints resolution service to those with content-related concerns.
It is also proposed that the body be ‘beefed up’ with powers to fine participants and have the ability to order the publication of apologies.
Of greatest interest is how the report suggests that the media (both traditional and online) should be incentivised to participate in the body.
It is proposed that those who do not participate in the new media regulation body should be penalised in terms of their ability to carry advertising.
It is vaguely stated for example, that: "… major advertisers should require membership [of the body] as a condition of advertising in news publications, including on blogs".
This recognises that all forms of media are reliant on advertising revenue and seeks to encourage participation by all.
This proposal could also resolve the problem of websites with servers based abroad seeking to avoid liability under UK law as they would nevertheless wish to participate in such a body to be able to attract UK advertising.
For example, it is understood that well-known Guido Fawkes political blog obtains 50% of the site’s revenue through advertising, but the server for the website is based abroad.
The proposal would also solve the so-called Richard Desmond problem.
Lord Hunt has also suggested that the participants could be given a form of a kite-mark which could be tied to advertising rates which could be achieved in conjunction with the Incorporated Society of British Advertisers (ISBA).
It was also suggested that those publications not part of the body should not be permitted to receive analyses by the Audit Bureau of Circulations (ABC).
However, critics may question that proposed sanction particularly given that this is one of a vast array of tools available to advertisers to assess where to place advertising online.
Dominic Mohan, The Sun’s editor, says that he has heard positive noises as to kite-marking from within the advertising industry.
Richard Wallace, editor of the Mirror, has highlighted the fact that big brands want to advertise in legitimate places and so kite-marking will assist all.
However, it is unclear whether it is envisaged that advertisers will be penalised by the Advertising Standards Agency (ASA) if they place advertising with un-regulated sites or publications.
If this is the case, there is likely to be widespread opposition from within the industry and the ASA will need enhanced powers.
Further, there are issues of funding. Advertisers may question whether it is right that their self-regulatory body which they fund should be used to regulate the media.
If the ASA is not be involved, it is unclear how the proposal might work in practice. Other questions for consideration include: Should sanctions be imposed through advertisers when a media outlet regularly breaches the Code? If so, should the advertising industry play a part in formulating that policy?
It is clear that creative proposals are required if the media landscape is to change and regulation is to be effective.
Lord Hunt has acknowledged recently that this is the start of a process which requires careful consideration and the advertising industry is yet to be properly consulted.
While this all represents a positive acknowledgment of the power of advertisers, it will be necessary for advertisers to keep a close eye on developments in this area and potentially make representations on issues which might affect the advertising industry at this early stage.