GroupM’s Channel 4 Deal

A few weeks back Campaign reported that GroupM has struck a twoyear deal with Channel 4 apparently worth amp163500m The deal is alleged to include the provision of some advertiserfunded shows from the agencyamp8217s sibling GroupM Entertainment Itamp8217s strange that any agency would want to publicize an overarching deal like this especially in the current climate where clientsamp8217 trust in their media buyersamp8217 objectivity is at a low point The logic for Channel 4 talking about this is a little clearer It makes some sense for them to promote their ability to attract serious money under the current model while rumours of government discussions over future funding mechanisms continue to ebb and flowAnyhow as is unfortunately too often the case with our trades the Campaign story didnamp8217t explore the implications of the largest media buyer in the UK selling shows to one of our largest broadcasters The story concluded that this arrangement is amp8220similar amp8230 to the previous dealamp8221So thatamp8217s all right thenAs some loudmouth me said from the stage in front of 800 antiadvertising TV producers at the Edinburgh TV Festival a million years ago 1989 TV back then had to look for new ways of bringing in funding Sadly as levels of ad expenditure donamp8217t expand at the same rate as the number of TV channels on offer it was always going to be essential to look for new editorially acceptable ways of bringing advertisers into the mediumAs the same loudmouth hello again then demonstrated in 1990 it is possible to bring an advertiseramp8217s money Kelloggamp8217s in this case into TV production amp8220The Magic Mirroramp8221 a childrenamp8217s animated series made with Anne Woodamp8217s Ragdoll Productions and then sell the show to a commercial broadcaster ITV without in any way compromising editorial integrityAnother age a different solution so who am I to criticize the evolution of this model amp8220The Magic Mirroramp8221 was the first or certainly one of the first examples in the UK of this sort of cofundingFirst thereamp8217s the matter of where the broadcasteramp8217s money goes In our case the answer was amp8220back to Kelloggamp8217samp8221In second place there are the conditions Our sale to ITV was for cash and there wasnamp8217t any element of airtime included The two decisions buying a show buying airtime were entirely separate We offered ITVamp8217s editors and controllers a childrenamp8217s show which they bought on meritNo commercial sales person was in any way involved in that dealKelloggamp8217s as a large TV advertiser continued to buy airtime in the same way that they had always done which as it happened was not through my agencyI donamp8217t know the details of the Channel 4 GroupM deal so what comes next is speculationGroupM Entertainment GME has brought much needed fresh thinking into the funding of TV productions in the USA If GME underwrites a deal and if they say to their advertisers amp8220Are you interested in coming in with us in return for some commercial benefits sponsorships or even product placements might be examplesamp8221 always assuming the show airs then that seems to me fair enoughIf on the other hand GroupM Entertainment offers shows to a broadcaster at let us assume a below ratecard price in return for large swathes of airtime and if their advertisers arenamp8217t informed about the arrangements then that strikes me as fraught with problemsFirst the broadcasteramp8217s editorial team might be persuaded to take something they wouldnamp8217t necessarily have commissionedbought because of commercial pressuresSecond the agencyamp8217s planners might be persuaded to include the broadcaster on plans where it might not sit comfortably just because there is a shedload of airtime that needs shiftingThis leads to two questionsOne Is it a good thing for the viewer that the editorial and sales activities of a broadcaster are becoming so intertwined if indeed they areTwo Is it fair on advertisers that their plans are based not on whatamp8217s best for them but on whatamp8217s needed to fulfil a deal of which they quite possibly had no knowledgeYou might have to be content to ask yourself these two questions Campaign sadly hasnamp8217t asked them of those involved on your behalf yetImage at top courtesy of Corbis The opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaVillageMyersBizNet management or associated bloggers

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GroupM’s Channel 4 Deal

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Brian Jacobs

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