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Introducing the British Television Industry

The Broadcasting Board has the authority to issue an eight-year franchise to a commercial television company. As the franchise holder is the only commercial broadcaster, the Board imposes strict conditions on programming standards. There is a defined balance between drama, comedy, children’s programmes, sports, and other types of entertainment. There are also rules about what sort of programmes can be transmitted at certain times, and more rules about the content of programmes and commercials. These rules are taken very seriously. Any franchise holder who does not abide by the rules is in danger of losing the franchise and hence the whole of the business. This may sound pretty tough, until you know what a franchise does for the holder.

A franchise means that a television company is the only supplier of broadcast commercial airtime within its area. If an advertising agency wants to reach an audience in the Midlands, Piccadilly is the only source of supply. There are cable and satellite stations active in the same area, but broadcast television commands the lion’s share of the audience. Commercial airtime is expensive, and while having a franchise is often likened to a license to print money, the franchise holder’s rates must be competitive to attract its share of the national advertising budgets.

The success of a commercial television company depends upon its ability to sell advertising. Before spending money with Piccadilly, advertisers must believe that people will watch Piccadilly Television’s programmes and the commercials broadcast along with them. Selling advertising, then, is all about convincing advertisers that enough of the people likely to buy their product will watch Piccadilly’s programmes.

Figure 1.1.2

Figure 1.1.2: Great Britain is divided into fifteen transmission areas. The franchise for each area is held by one commercial television franchise holder.

Here’s how it works. Let’s say that an advertising agency is running a television campaign for a product targeted at homemakers. Remember that each of the fifteen television companies is restricted to a specified transmission area. If the advertising agency wants to reach householders in the south of England, the agency must spread the budget over the five television companies operating in that part of England. These companies are competing for a share of the agency’s advertising budget. The one that can offer the largest numbers of householders watching its programmes and that can sell time at the most attractive rates will get the biggest share of the budget.

Audience measurement bureaus track the number of viewers of each of the television channels, with a combination of questionnaires, surveys, and electronic monitoring equipment. These audience numbers, or ratings, are analyzed by programme type, audience type, time of day, television company, and any other break down that makes the ratings salable to the television companies. Every week, the bureaus provide the ratings to the television sales executives who use the information as ammunition for selling airtime to the advertising agencies.

Figure 1.1.3

Figure 1.1.3: Audience measurement statistics are an important aid in selling airtime.

But just having the numbers is not all there is to it. The same advertising time slot can be sold for a number of different rates and, naturally enough, the advertising agency wants to pay the cheapest one. However, it doesn’t always pay to be a cheapskate. Some of the cheapest rates are sold on the basis that another buyer who is willing to pay more for the time can preempt the first buyer. This results in the first buyer’s losing advertising time that might be a key element in a campaign. The rate structure for selling commercial television time is complex, and discovering all its intricacies is an analysis treat that lies ahead of you.

There are all sorts of rules about when certain advertisements may or may not be shown. For instance, alcohol advertisements may be shown only after 9 p.m. If an actor is in a programme, a commercial containing the same actor may not appear within the forty-five minutes preceding or following the programme. If an advertisement for floor cleaner is broadcast, then no other floor cleaner advertisements may appear within the same commercial break. As you work on the project, you will come across other rules like this. Keep in mind that the Broadcasting Board can, and probably will, change any of these rules at any time.

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