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TV3 HAS SAID it is considering pursuing RTÉ for significant damages after the national broadcaster confirmed it would be scrapping its ”share deal” advertising sales model.
The Competition Authority today wrote to TV3 saying RTÉ had agreed to change its TV advertising model, where it charged advertisers a higher rate if their spending with RTÉ fell below a certain threshold of their total TV advertising budget.
TV3′s chief executive David McRedmond said his station was losing advertising customers “virtually every day” as a result of RTÉ’s policy, which is now to be scrapped from July of next year.
TV3 believes it may have lost upwards of €30m as a result of the “share deal” scheme – and may seek damages against RTÉ to reclaim its losses.
McRedmond said a decision in that regard would be made after TV3 received a copy of the Competition Authority’s ‘Enforcement Decision’.
“We believe we have suffered very significant damages,” he said. “The Competition Authority are very clear that this practice is one that could not continue.
“We’ll be looking at what the possible options are for remedies – the reality is that we’d have to litigate,” he said, adding that TV3′s priority was to get the government and Broadcasting Authority of Ireland “stuck in to give RTÉ a clean bill of health”.
McRedmond also criticised RTÉ’s decision to delay the abolition of the scheme until July, commenting that “only RTÉ could abolish something nine months from now – that’s just nonsense.”
RTÉ, however, insisted that the Authority had not found its practice to be anti-competitive and said TV3 had tried to present “a voluntary and agreed position as a forcible outturn”.
“The Competition Authority has welcomed and agreed to RTÉ’s own planned actions in respect of its advertising trading system, including an extended period of the existing ‘share deal’ trading into mid-2012,” it said in a statement this evening.
It said the Authority’s ‘Enforcement Decision’ was a formal title for the outcome of its investigations, but not a decision “which seeks to enforce any ruling or finding against RTÉ.”
“The investigation initiated by TV3’s complaint has closed on amicable and agreed terms. RTÉ was happy to agree to change the way it traded. RTÉ ‘s willingness to do this was directly informed by its overall review of its airtime sales method.”
RTÉ’s head of TV sales Geraldine O’Leary said the ‘share deal’ had “served a purpose for both RTÉ and for clients and advertisers”.
“But the world has moved on and we are moving away from share-based deals. We will do so in mid-year when the systems are fully ready for us to make that change.
“The Competition Authority was very accommodating and agreed to our proposal to maintain this system until changes are in place as proposed by us next year. The TV3 statement is absolutely misleading.”
David Hayes of media agency MEC Ireland explained that RTÉ had introduced the deal when it lost its broadcasting monopoly in Ireland, in order to dissuade advertisers from ‘cherry-picking’ advertising at the most high-profile times of the day.
He said it would be difficult to put a value on the damages that other broadcasters may have lost as a result of the deal, but said that the Competition Authority’s decision appeared to be “opening the door for damages”.
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why do we pay a tv licence and they still get money for adverts they should not be able to have it both ways. stop having adds and have a tv licence or have adds and no tv licence if tv3 can do it and have fairly ok programming then rte can do it, and cut the pay of underworker over paid out of touch presenters.
Exactly Sabrina!
Would you prefer no TV license and 10 minutes of ads every hour? That’s how America does it.
No Mark, I personally would prefer to have the choice of not paying for a TV licence and not having Tubbers, Kenny etc inflicted on me when I can’t find the remote.
Well RTE already has about 10 minutes of ads every hour anyway – at the very least. Usually at the start of every hour, again at 15 minutes, again at 30 minutes and again finally at 45 minutes before the process starts all over again – the exact same as TG4 and TV3.
@Sabrina – we don’t have the population here to support a licence only model as in the UK.
@brian I understand we don’t have the popoulation for a licence only funded national broadcast what gets to me is the amount of money they pay over rated, out of touch presenters with biased out of date points of views and programmes that they air that are old and past their time. I am not saying tv3 is great but I perfer it to rte and if they can fund their programmes without the licence then rte should have great programmes with the funding they get and they don’t.
Now RTE will look for a hike in license fees to off set the fine and once again the poor sod on the street is paying for big business being greedy.
The competition authority has no real teeth
In relation to the adds.
Get any boxset of say criminal minds or something like that. When you watch it only bout 40-45 min an episode. That’s 15 min of add every hour. While I agree that Ireland ain’t big enough for license only national broadcasters I don’t see why they have to pay the ‘main’ presenters 400,000 – 700,000 a year.
TV3 have ads every ten mins and they last for 5 mins. I find it very frustrating. I don’t know how they are losing out as they show twice as many ads as RTE. The only fair way is to share the licence fee between all Irish stations with rules about programming.
RTE gives free advertising to certain already heavily subsidised sectors.Every tine you hear the slogan "RTE Supporting the Arts" on Radio 1 it means that the ad you have just heard was given at "no charge".
Muggins the license payer paid for it.
I really hope TV3 don’t seek damages, that’s just taking money out of TV licence owner’s pockets.
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