An extended war in the Persian Gulf will strain budgets of tv news organizations around the world, but the stakes are higher than most for Britain’s Independent Television News, which supplies the commercial webs ITV and Channel 4.
The war couldn’t have come at a worse time for the 15 regional ITV stations that own ITN. They recently spent close to £ 7 million ($13.5 million) to cover an ITN budget overrun caused by a spate of major international news stories (China, Eastern Europe, Kuwait) and ITN’s move late last year into a new £ 70 million ($136 million) building.
At the same time, ITV broadcasters are suffering from a massive downturn in ad revenue because of the recession and the war. It’s estimated ad income for January will be down 20% from last year’s comparable figure (repping a real drop of about 30%).
And all this at a time when ITV stations are slashing overheads in preparation for an auction of commercial tv contracts. “It’s tough. There’s no getting away from it, but we’ll just have to cope with the new demands,” said Clive Leach, managing director of Yorkshire TV.
The rub for ITV stations is that although the ITN’s “News At Ten” primetime slot is earning better-than-average ratings (early indications are that viewing figures are up 50% on average viewership of 6 million) since the war broke out, its spot income is on the wane.
“Travel and airline operators, which traditionally invest the bulk of their ad spend in January and Februay, have naturally pulled their campaigns,” said Alec Kenny of media buying group Kenny Lockett & Booth. Upshot is that the price of a spot on “News At Ten” (normally about $90,000 for 30 seconds) is no longer selling at a premium.
War costs $235 per day
Despite their woes, ITV companies have agreed to bankroll extended war coverage at a daily cost of about £ 120,000 ($235,000). Costs of programming an extra seven hours a day of news (including overnight coverage) comes to about £70,000 ($136,000) a day while costs of reporting the war total £ 50,000 ($97,000) a day (or about $2.9 million a month).
Glyn Mathias, deputy editor of ITN, said the cost of covering the gulf crisis since Iraq’s invasion of Kuwait came to about £ 1 million (about $1.95 million). The news organization has about 70 staffers in the gulf.
One short-term winner in the gulf is satellite service Sky News, part of the British Sky Broadcasting network. Sky said Israel’s Channel 2 had signed up to rebroadcast part of its gulf coverage, while the Ministry of Defense has requested a feed to the British Forces Broadcasting Service in Germany (serving British troops stationed there).
Even more pleasing, Sky News recently received a letter from George Russell, head of the regulatory Independent Television Commission, praising its coverage of the war. Less than a month ago, Russell hinted Sky’s application for a new license to transmit in the U.K. might be rejected following its merger with British Satellite Broadcasting.