RTVE to lose advertising in fall

DTT, cable and satellite to benefit

The Spanish government is set to nix advertising on pubcaster RTVE in the fall.

The announcement, made by deputy Prime Minister Maria Teresa Fernandez de la Vega on Monday, took the local industry by surprise.

The government had mentioned the possibility on April 16, following Gaul’s decision to ban commercials on its pubcaster, France Televisions.

But unlike French pols, who debated the implications of the move for the best part of a year and are introducing the change gradually, Spain is rushing the decision into effect.

As in France, Spanish private broadcast networks and telcos will pick up part of the tab. Under an upcoming RTVE finance law, Spanish TV nets must contribute 3% of their yearly revenues to RTVE coffers, bringing in an estimated E140 million ($186.5 million) a year. Telcos will kick in 0.9% of their revs, around $386 million a year.

State aid for RTVE will cover 45% of the pubcaster’s total budget for next year, which is estimated at $1.6 billion. There is not expected to be a shortfall. However, RTVE’s sports acquisition expenditure will be capped at 10% of its budget. The pubcaster also will reportedly cut its annual primetime broadcasts of U.S. movies to 80 a year, while it will receive $132 million more to finance inhouse productions.

The pubcaster refused to comment about the government’s plans Wednesday.

One big question is who will benefit most from RTVE’s loss of ad revenue, estimated at $636 million a year. The main beneficiaries of pubcaster France Television’s primetime ad stoppage, which started in January, have been digital terrestrial webs, satellite and cable channels.

“Something similar could happen in Spain,” said an analyst. “The main beneficiary could be startup broadcaster La Sexta and DTT services after the 2010 analog switch-off.”

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