February 9, 2010 1:17 pm

TV product placement gets go-ahead

Broadcasters will soon be able to accept payment for featuring branded goods in their programmes for the first time in the UK, finally bringing the country into line with most of Europe.

Ben Bradshaw, the culture minister, said in a statement on Tuesday that the government would legislate to allow TV product placement, calling it an “important departure”.

“Not to do so would jeopardise the competitiveness of UK programme makers as against the rest of the EU, and this is something which we cannot afford to do,” Mr Bradshaw said.

Estimates of the annual revenue generated for broadcasters such as ITV from product placement range between £25m and £100m, while the £3bn market in TV advertising is forecast to continue its decline until 2012.

Continuing the ban would restrict a new income stream “at a time when this crucial part of our creative industries needs all the support we can give it”, he added.

Denmark is now the only EU member state to resist introducing product placement. The government will enact a European directive from 2007 which the European parliament originally said should have been implemented by the end of last year.

As expected, the government will ban paid inclusion of alcoholic drinks, foods that have high levels of fat, salt or sugar (HFSS), over-the-counter medicines, baby milk, gambling and smoking.

The BBC will not be allowed to take advantage of the new rules. Current affairs, consumer and religious programming, including the news, and shows aimed at children will also be exempt from product placement.

HFSS foods and alcohol will be barred from paid inclusion because “children’s viewing is not confined to children’s programmes”, Mr Bradshaw said. Extending existing guidelines which restrict certain advertisements based on the proportion of young people watching a given show or the time it is shown “would be complex to administer and would not provide the certainty which the government seeks”, the minister added.

Producers will not be able to begin making programmes under the new regime until “later this year” after Ofcom, the media regulator, completes another consultation on the detailed changes required to its broadcasting code.

The government received 1,480 responses to its consultation on product placement, which began last summer after Mr Bradshaw reversed the policy of his predecessor, Andy Burnham, now health secretary.

“As a result of this consultation the government has concluded that we will be able to allow television product placement in a way which will provide meaningful commercial benefits to commercial television companies and programme makers while taking account of the legitimate concerns that have been expressed,” Mr Bradshaw said.

But critics of the proposals say that product placement is unlikely to generate new revenues for broadcasters, merely diverting funds from existing advertising budgets.

“If you take out HFSS and alcoholic drinks, those are the two areas most likely to get excited about product placement,” one broadcaster said last week when news of the planned restrictions emerged.

Isba, which represents British advertisers but has opposed product placement, said the “blacklist” blocking certain products “seems to reflect the prejudices of ministers rather than a coherent policy”.

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