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Summary

Ofcom’s review

1.1 Following changes to the European framework of advertising regulation as set out in the Audio Visual Media Services (AVMS) Directive (see Annex 2), Ofcom decided to carry out a comprehensive review of its Rules on the Amount and Distribution of Advertising (RADA). In general, these changes widen the discretion available to Ofcom in setting rules that apply to channels licensed in the United Kingdom. Broadly speaking, the framework allows Ofcom to impose the same or stricter rules to channels licensed in the UK. However, Ofcom’s rules may not be any more permissive than is allowed by the regulatory framework.

Stage One

1.2 We published Stage One of the review in March 2008 , and invited comments on proposals for simplified and liberalised rules on the scheduling (or ‘distribution’) of television advertisements. In a statement published in July 2008 , we set out our conclusions, and announced that the new Code on the Scheduling of Television Advertising (COSTA) would replace RADA with effect from 1 September 2008.

1.3 Alongside Stage One of the review, we summarised the issues to be tackled in Stage Two of the review , including whether there should be changes to the rules on the amount of advertising, on the number and length of advertising breaks, and on the amount of teleshopping. The purpose of this was to ask interested parties if we had identified the appropriate range of options to include within the Stage Two consultation, and whether the suggested approach to assessing the impact of these options was reasonable.

Stage Two

1.4 We have taken the views of respondents (Annex 4) into account in framing the Stage Two consultation, and in refining our assessment of the impact of different options. We have also had regard to the outcome of deliberative research that we commissioned into the attitudes of viewers towards possible changes to regulation . Clearly, there are many possible permutations of the options open to Ofcom. We have identified several main options that are set out in sections 3, 4 and 5. Ofcom will consider any other variations suggested in response to this consultation.

Amount of advertising

1.5 In section 3, we set out a broad range of regulatory options for:

1. overall limits on the amount of advertising on both PSB (public service broadcasting) and non-PSB channels, ranging from a reduction of advertising on non-PSB channels, to an increase in advertising on all channels to the maximum minutage permitted by the European regulatory framework; and
2. rules on the amount of advertising during peak hours on PSB channels, ranging from the status quo to an increase.

1.6 So far, almost all stakeholder groups who responded, including most viewers, broadcasters, advertising agencies and advertisers, have expressed opposition to the idea of more advertising on television. As explained in section 3, our preference is to maintain the status quo on the overall amount of advertising on television, although we shall consider all representations and relevant factors before reaching a decision. We have not expressed a preference as regards rules on the amount of advertising during peak hours on PSB channels.

1.7 Section 3 also sets out proposals to end the designation of the 7am to 9am period as ‘peak-time’ on PSB channels, and to apply the same rules to this period as to other non-peak periods.

Number and length of advertising breaks

1.8 Section 4 discusses options for rules on the number of advertising breaks within programmes, ranging from the status quo, to an increase in the number of breaks in programmes of 60 minutes or more. We also seek views on whether more breaks should be allowed in programmes of autonomous parts (e.g. magazine-type programmes, where the content of one section is not linked to that of another). However, we are not including the option of no regulation. We consulted in the March 2008 document on whether there should be limits on the number of breaks, and in our July 2008 statement, we concluded that there should be.

1.9 We also set out options for rules on the length of internal advertising breaks on PSB channels, ranging from a reduction in the permitted duration of breaks, through the status quo, to no rules at all. We have not expressed a preference for any particular option.

Teleshopping

1.10 In section 5, we set out options for rules on the amount of teleshopping permitted on both PSB and non-PSB channels, ranging from the status quo (a maximum allowance of 3 hours a day on non-PSB channels, but no allowance for PSB channels), through partial deregulation, to full deregulation, under which channels would be allowed to schedule as much or as little teleshopping as they wished.

1.11 We also draw attention to the implications of:

1. a) changes in the interpretation of European law, which may mean that quiz TV, adult chat services and psychic services (currently regarded as editorial content) are more appropriately treated as teleshopping; and
2. changes to the law in Great Britain (but not Northern Ireland), which may mean that transactional gambling services (including gaming and betting) are more appropriately considered to be teleshopping, and which will mean that, within the next few months, existing transactional gambling content (whether individual programmes or channels) will be required to be operated as teleshopping.

1.12 We explain in section 5 that we have a preference for removing the rules applying to non-PSB channels, and allowing PSB channels to have a teleshopping allowance, limited to times when audiences are relatively small.

Next steps

1.13 We would welcome views from any interested stakeholders, including viewers, broadcasters and advertisers before the consultation closes on 11 December 2008. More details of how to respond and the specific questions we are asking are set out in Annex 1, as well as in sections 3, 4, 5 and Annex 5.

1.14 We shall consider the responses and other relevant considerations before deciding on the appropriate way forward. This may include an option or options that differ in some respects from those set out in this document. The statement we intend to publish in the first quarter of 2009 will set out our reasoning.

1.15 As indicated in the March 2008 document, Ofcom expects that any changes to the overall amount of television advertising would be implemented with effect from 1 January 2010, to allow time for the repercussions to be taken into account in the annual negotiations between broadcasters and media buyers. This would include any changes to rules on peak time minutage on PSB channels that might increase significantly the volume of commercial impacts, and hence have similar repercussions.

1.16 However, as none of the options for changes to the distribution of peak time minutage, to the number and length of advertising breaks or the amount of teleshopping would oblige broadcasters to change their existing arrangements, nor result in a change in the overall amount of advertising minutage permitted on television channels, we see no reason to delay implementation of any changes in these areas. Accordingly, if we decide that changes in these areas are warranted, we intend that they should come into effect shortly after publication of the final statement.

1.17 A copy of this document in a format suitable for use by screen readers has been posted on Ofcom’s website. Ofcom can also provide documents to individuals in alternative formats (e.g. Braille, audiotape or large print) on request. We may also provide translations of documents into languages other than English. To request non-standard versions of documents, please contact the Ofcom Contact Centre at contact@ofcom.org.uk, by phone at 0845 456 3000 or 020 7981 3040, or by textphone at 0845 456 3003. Please note that the time needed to produce an alternative format document will depend on the length of the document.

• Review of television advertising and teleshopping regulation - Stage Two [pdf]
  Full Print Version - updated 28|10|08

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