Extracts from OMG UK Media Intelligence Unit’s Five Things Series. To subscribe to the daily newsletter, click here.
Political ads could be heading to UK TV screens due to legal loophole
ITV is considering taking paid ads from political parties for the first time during the upcoming general election thanks to a loophole in broadcasting law. The broadcaster told the Guardian it was considering whether to allow political parties to buy space on its ITVX streaming platform. This could leave viewers having Love Island or Saturday Night Takeaway broken up by a lecture on the economy. Ever since commercial television began in 1955, British political parties have been banned by law from buying television adverts. The idea was that this improved the quality of public debate and stopped wealthy political parties buying their way into voters’ homes – ensuring the UK has avoided the political attack ads that are prevalent during American elections. But the ban – last updated in 2003 – only applies to traditional television channels and not to streaming television delivered over the internet. In the past, British political parties did not have enough money to buy campaign adverts. But Labour and the Conservatives are set to take advantage of a little-noticed rule change announced last year by Michael Gove, which will increase the amount national political parties can spend on a general election campaign from £19.5m in 2019 to £35m for the next general election. Smaller political parties such as the Liberal Democrats, who are unlikely to raise the maximum £35m, are already concerned they could be squeezed out as voters are swamped with paid-for adverts – and left relying on the handful of free party political broadcasts that are given to all parties.
NBCUniversal rolls out personalised broadcast experiences
NBCUniversal has launched personalised broadcast experiences through its NextGen TV (ATSC 3.0) over-the-air channels on NBC- and Telemundo-owned stations in four US markets. The new product represents a significant milestone in realising NextGen TV’s potential by introducing personalisation, hyper-localisation and enhanced content capabilities to broadcast television to improve the viewer experience and enable advanced engagement, advertising, and measurement opportunities. “The launch of this innovative experience is a considerable milestone for broadcast television and demonstrates the immense potential and possibilities NextGen TV has for viewers, programmers, stations and advertisers,” said Shawn Makhijani, Senior Vice President of Business Development and Strategy & NBC Spot On, NBCUniversal Advertising & Partnerships.
UK government taking fresh look at AI regulation
The UK is starting to draft regulations to govern artificial intelligence, focusing on the most powerful language models which underpin OpenAI’s ChatGPT, people familiar with the matter said. Policy officials at the Department for Science, Innovation and Technology are in the early stages of devising legislation to limit potential harms caused by the emerging technology, according to the people, who asked not to be identified discussing undeveloped proposals. No bill is imminent, and the government is likely to wait until France hosts an AI conference either later this year or early next to launch a consultation on the topic, they said. Prime Minister Rishi Sunak, who hosted the first world leaders’ summit on AI last year and has repeatedly said countries shouldn’t “rush to regulate” AI, risks losing ground to the US and European Union on imposing guardrails on the industry. The EU passed a sweeping law to regulate the technology earlier this year, companies in China need approvals before producing AI services and some US cities and states have passed laws limiting use of AI in specific areas. The re-think on AI regulation was first reported by the Financial Times. Separately, officials at both the technology department and the Department for Culture, Media & Sport have also proposed amending UK copyright legislation to allow companies and individuals to opt out of allowing language models to scrape their content — something of particular concern to the entertainment industry, the people said.
IPA Bellwether: Budgets expand again but main media weakens
Total marketing budgets saw “solid expansion” in Q1 in a growth streak since Q2 2021, according to the IPA’s latest Bellwether Report. The quarterly study, which analyses marketers’ confidence and media spend decisions, found that 24.4% of UK marketing professionals surveyed increased their overall marketing budgets in the first quarter of 2024, while 15% decreased them. This translated to a net balance of 9.4% upwardly revising budgets — the second-highest figure in almost two years, but down from 14.7% in the previous quarter. The “sustained upturn in marketing spend” comes as the UK economic backdrop is “improving”, with an “impending emergence from recession and falling inflationary pressures”, according to the report. Joe Hayes, principal economist at S&P Global Market Intelligence, said: “With business survey data suggesting UK GDP will expand in the first quarter, it’s no surprise to see another strong round of marketing budget growth. “Cost-of-living pressures and high borrowing costs have led households and businesses to retrench in recent times, making the market more competitive to earn and retain customer business. Throughout this period, we’ve seen marketing perform strongly, so it’s very encouraging to see that firms are staying true to the course that has clearly yielded positive results.”
Netflix adds 9.3m subs in Q1
Netflix added 9.3 million subscribers in Q1 2024, hugely surpassing analyst estimates, and now has 269.6 million subscribers globally, further asserting the company as the world’s leading streaming service. Netflix reported revenue of $9.4 billion (€8.8bn), up 15 per cent YoY, and operating income of $2.6 billion. The company advised that it will stop reporting subscriber numbers and average revenue per user (ARPU) from Q1 2025. Netflix already stopped offering quarterly paid membership guidance last year. “Almost 270M households across 190+ countries now subscribe to Netflix,” company executives said in a letter to shareholders. “With more than two people per household on average, we have an audience of over half a billion people. No entertainment company has ever programmed at this scale and with this ambition before.” Despite the positive figures, disappointing Q2 revenue guidance dragged Netflix stock down by more than 3 per cent in after-hours trading on April 19th. Commenting on the results, Paolo Pescatore of PP Insight said: “Expectations are always high and the company did not disappoint. A cracking start to the new year and absolutely smashed net adds for the quarter. No matter the company’s attention to switch focus from subscribers to financials, net adds is the key metric that everyone wants to see.”
