TV not losing out to Google, say analysts


Andy Duncan, the chief executive of Channel 4, this week pointed out that Google is set to overtake Channel 4's ad revenue this year - and could pass ITV1 within 18 months - and implied the milestone was directly linked to the issues faced by the TV ad market.


Dominic Proctor, the chief executive of media agency Mindshare Worldwide, said: "Although it is fair to say that Google is growing at a huge rate, the issue is not comparing apples with apples - Google is involved in search and ITV is brand building.

"It is the wrong conclusion to say that ITV is losing out to Google. Google has tapped an immense 'long tail' of small advertisers that would never be traditional TV advertisers anyway.

"We believe that ITV can fight back and be rescued and return to revenue growth."

Mr Duncan described the issues facing the TV industry as a "structural change", not simply a cyclical one.

ITV1, the biggest commercial channel in the UK, is set to be down around 14%, or £230m, year on year in advertising revenue.

Last month, the chief executive of WPP Group, Sir Martin Sorrell, pointed to the rise of the internet as a factor in the depressed state of the overall UK advertising market.

Omar Sheikh, a media analyst at Dresdner Kleinwort, said: "There is no evidence that money is coming directly out of TV and going online, which is how Mr Duncan's comments have been reported.

"The figures do not support the inferences made out of [his] comments - one of the obvious victims has been the likes of regional newspapers and Google has successfully tapped smaller non-TV advertising players."

A senior TV executive said: "This assertion [by Duncan] is entirely transparent from Channel 4's perspective as they put the begging bowl out to the government for extra cash.

"What they are effectively doing is putting out misleading statements that risk harming the rest of the commercial sector."



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