At a recent, unique OC event, a wide range of broadcasters, producers, brand-owners, media agencies and prop placement agencies joined an illustrious panel to debate the proposed deregulation of the UK’s product placement rules following the adoption at EU level of the Audio Visual Media Services Directive. Carla Basso highlights some key points.
Topic: Product Placement
Who: OC networking event with panellists comprising: Chris Bone, Broadcasting Policy Unit, Department for Culture, Media and Sport; Magnus Brooke, Director of Regulatory Affairs ITV; Dominic Burns, Senior Vice President, Licensing UK FremantleMedia; Greg Nugent, Marketing Director, Eurostar; and Liza Reade, Placement Director, 1st Place.
When: 3rd September 2008
Law stated as at: 3 September 2008
Those of you who have been following our previous updates on product placement may have attended our recent networking event on the subject. Our panelists each outlined their views on the proposed new product placement regime which was then followed by an energetic debate about the government's apparent reluctance to relax the UK rules (as is now permitted by the Audio Visual Media Services Directive), much to the disappointment and incomprehension of the UK's broadcast, production and advertising industries, each of which were well represented in the audience. Discussion ranged across issues such as: Is Andy Burnham right to argue that the practice "contaminates" programmes and should not be permitted? If it is allowed, will placement rights be sold and controlled by production companies, broadcasters or both? How will deals be structured and implemented so as to avoid undue prominence and any impact on editorial integrity? What role will media agencies play?
For those who could not make this event, a snapshot of the views and concerns raised is set out below:
- Burnham's early comments on his reluctance to allow relaxation of the rules means that, notwithstanding that the Ofcom consultation does not close until 31st October 2008, the government has somewhat prejudged the results of the consultation As the financing of original programming becomes more difficult product placement funds would be welcome gap-funding, but if that is not to permitted in the UK, what, if any, financial alternatives are to be made available here?
- There is no government evidence that audiences are against product placement – in fact responses to the 2006 Ofcom consultation on product placement suggest otherwise. Product placement is already here in acquired (non-UK) programmes and films, and prop placement agencies made the point that nobody notices prop placement, which saves the BBC £2.5M per year..
- Inconsistency in the rules for home-grown and overseas programming means a risk that broadcasters will get programmes made overseas incorporating product placement and import them into the UK. While some pointed out that this has always been the case (and any such imports are required to comply with the current rules against undue prominence) others suggested that liberalisation in other EU countries would make this even more likely. Others felt that people were generally being too optimistic regarding the chances of liberalisation elsewhere in Europe. What is going to happen to the UK market if most other European countries liberalize their product placement regimes? There was concern as to how the UK will be able to remain competitive in co-productions if this happens.
- "Product placement should be seamless not shameless". Product placement can provide a much needed new revenue stream, but good product placement requires sensitivity/creativity, and careful Ofcom regulation would still be required. The market in the UK is too mature/competitive for product placement to result in a slew of bad viewer experiences. The UK has the opportunity to learn lessons from the US experience of product placement. The American Idol/Coca Cola style of product placement was seen by some as "too much" for UK audiences, stressing British sensibilities, and more subtlety would be needed. Blatant product placement would not work in the UK. Some brand owners suggested they would consider product placement if it did not interfere with the narrative – it was an issue of balance – it would be naïve to ban product placement completely but the US approach would result in people turning off/over.
- Product placement is not currently banned for video on demand content – why extend the ban now? Broadcasters were concerned that if product placement continued to be allowed without regulation on sites like Bebo, but video on demand services such as the BBC iPlayer are included in any ban this would lead to "a crazy situation" – product placement could be included in e.g. Kate Modern on Bebo, but not if the same programme was shown on a broadcaster's own video on demand service. One of the delegates stressed that Andy Burnham's negative comments had turned brand-owners off broadcasting and they were now looking at online content instead as a means of securing brand integration.
- Producers felt that (if allowed) product placement deals would have to be a joint process with both broadcasters and production companies needing to be happy. It was important that the producer felt that the placement was editorially appropriate and that successful placement would require input from the production team. As to whether media agencies had a role in product placement deals, some brand owners felt that they could create an unwanted distance between the sponsor and production staff, but others thought some agencies could, for example, have invaluable relationships for content distribution etc. However, it was vital that product placement wasn't just an ancillary bolt-on to standard services, and needed to be given sufficient and proper consideration for the brand owner.
- Finally, what would constitute appropriate signalling of product placemen? The Directive and DCMS consultation contained no guidance. Some suggested the signalling should be minimal and an announcement such as "this programme contains product placement" was enough. Producers suggested that the brands which had been placed could be listed in the end credits. Product placement agencies pointed out that brands would not want a situation where the money spent on the identifier counteracted the money made from product placement – viewers were not stupid and could recognise product placement themselves. Others agreed that having identifiers flash up on the screen would irritate viewers.
Why this matters:
Product placement is clearly a welcome support to production budgets in the current climate. DCMS warns against relying on the market value estimates outlined in Ofcom's 2006 product placement consultation, which suggested UK income from product placement may reach £25-35 million over 5 years, on the basis that such estimates predate the current regulatory proposals. But what about the interests of brand owners in all of this? The market may be small in value terms, but product placement would enable brand owners to reach consumers during peak-time viewing – no small benefit at a time when viewers are increasingly technologically able to avoid traditional ad spots.
In the meantime, the consultation process is open until 31st October 2008. In the light of the government's early views, brand-owners, producers and broadcasters with an interest in seeing de-regulation of the product placement rules will need to bring strong opposition to persuade this current government to change its mind.