France: Ad woes worry pubcasters

Mip Territory Reports

PARIS — French media agencies and TV advertisers are warily navigating a new world since President Nicolas Sarkozy’s bombshell announcement in January calling for an end to all advertising on national pubcasters as of next January.

The storm has already hit France Televisions with a 27% drop in advertising in January — three times worse than the seasonal average in recent years. More defections are certain to come in the run-up to autumn.

“This is clearly a very hard period for France Televisions and their advertisers, who want to appeal to the higher-income viewers attracted by its cultural programming,” says Eric Trouffet, head of marketing at TNS Media Intelligence. “With rates on (private networks) TF1 and M6 already far more expensive (than on public networks), ad rates — especially for smaller businesses — could easily become prohibitive.”

A recent survey by marketing communications group Aegis Media France revealed that two-thirds of 87 representative advertisers polled worried their campaigns would perform less well on television in general. For the time being, 57% said they would maintain their current TV ad budgets while 42% would reduce them.

British media research outlets Screen Digest TV and Broadband Intelligence predicted in February that “if France Televisions ceases to trade airtime, the total French advertising pie is expected to shrink, because we believe only 60% to 80% of (its) revenues will be diverted to other channels. The rest will be spent by advertisers on other media.”

Other than Internet, radio and other outlets, one obvious benefactor of all the changes looks set to be France’s mushrooming digital terrestrial television (DTT) market. Screen Digest predicts up to 50% growth in ad revenues for some DTT channels once the pubcaster restrictions take effect.

Aegis predicts an audience share for DTT channels of 14% by early 2011, a rise of more than 70% from today.

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