France plans to cut ad time on state TV

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PARIS -- French Socialist Prime Minister Lionel Jospin has unveiled a plan to slash advertising time on the nation's state-run television stations in a move that many predict will seriously impact ad spending.

Under the plan, which is set to be introduced as draft legislation next December, public stations France 2 and France 3 will be forced to reduce advertising during prime time by a still undetermined percentage.

Public channels are currently allowed to broadcast 12 minutes of advertising each hour during prime time; the reduction may limit that to as little as six minutes per hour.

What is certain, however, is the financial hit involved. According to press reports, when the restriction takes hold in 2000, France 2 and France 3 are expected to collectively lose $71.4 million in ad revenues per year, totaling $360 million by Jan. 1, 2005, when the initial duration of the reduction ends. Those losses will be reimbursed in full via new governmental subsidies.

The stated goal of the project is to re-focus state television's mission of "public service" by whittling down what Socialist Communications Minister Catherine Trautmann has called its "interminable blocks of advertising".

The compensatory subsidies and an accompanying plan to reorganize France's state television sector also dispels any notion of a once anticipated privatization.

The ad reduction measure is also being depicted as a move that will increase advertising and related revenues on privately owned stations, as well as other media. But opponents of the plan contest that logic, noting existing laws already limit ad time on private channels - notably TF1 and M6, most likely the biggest recipients of the state TV reduction.

Meanwhile, as the aftermath of the 1988 failure of Silvio Berlusconi's La Cinq TV station showed, when ad space in a medium becomes hard to come by, French advertisers tend to prefer paying higher prices for less space within that same medium rather than generate new campaigns in other media.

"The consequence of this reduction on state television will be a general increase in advertising rates across TV stations, and at TF1 and M6 in particular," says Jacques Bille, vice president of France's Association of Advertising Agencies. "The practical result is less air time at higher prices for advertisers, and less work for agencies.

"Symbolically, the plan also carries the message that advertising is a pollutant that needs to be cleared from TV screens," he adds. "It ignores the fact that advertising is an essential marketing tool that modern businesses have come to rely upon, and that the viewing public doesn't share the government's view that ads are disruptive and irritating."

The proposed reduction also reinforces France's reputation for imposing legislative restrictions on business and communications, at the same time as it's seeking to liberalize in unison with international markets.

French agencies have only recently got over the impact of the 1994 Loi Sapin, the law which slapped draconian controls and iron-clad rate cards on the media selling business, and a 1996 law that makes French obligatory in all ads.

"It's hard enough battling undeserved stereotypes of France as a backwards, Latin market," laments Mr. Bille. "But proposals like this one only reinforce that stereotype in being so backward."

Copyright September 1998, Crain Communications Inc.

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