Fees subsidize spots
A SW panel discussion in Lugano highlights the pitfalls of the new Radio and Television Act
An SW panel discussion in Lugano highlights the pitfalls of the new Radio and Television ActBy Piero Schäfer*32 parliamentarians and 35 representatives of the media and communications industry took part in a panel discussion on the new Radio and Television Act (RTVA) organized by the Swiss Advertising Association (SW) in Lugano. Conclusion: the law remains controversial.
After the last SW Parliamentary Talk in Bern, Ticino Council of States member Filippo Lombardi suggested continuing the series of talks at the session in Lugano. The RTVG was able to mobilize a remarkable number of interested parties: Over 60 guests came to the Hotel de la Paix.
After Marc Furrer, Director of the Federal Office of Communications (Bakom), had outlined the concept of the new law, SRG Director General Armin Walpen praised the basis for the legal text. It is excellent because it accurately reflects the realities of Switzerland. Even if he would have liked the SRG's performance mandate to be a little less demanding, Walpen also welcomed the clear mandate to provide a public service. The SRG Director General is also positive about the legislator's intention that SRG should continue to be financed by both license fees and advertising in the television sector. Walpen sees problems above all in the standards for implementation. Compared to the current situation, several restrictions and controls are planned. In particular, he wonders whether the state is not burdening itself with responsibilities that will ultimately overburden it.
Tamedia wants twelve minutes of advertising time per hour
Christian Staerkle, President of the Swiss Private Radio Association (VPS), welcomed the idea of dualism in radio (fees for SRG, advertising for private broadcasters). However, he questioned whether the proposed limited distribution of license fees to radios in mountain regions was the right thing to do. Staerkle considers advertising bans (for example for alcoholic beverages) for Swiss radios to be absurd as long as foreign stations can advertise cross-border for products that are banned here in Switzerland.
In principle, Staerkle considers the draft RTVA to be practicable. He has more reservations about television. Unfortunately, dualism is not envisaged here. This leads to a market distortion: as SRG is not only financed by advertising but also by fees, it can dictate spot prices on the market. This means that the fees subsidize the spot prices to a certain extent.
The consultation on the RTVA runs until the end of April. More and more associations and interest groups are currently publishing their opinions. Tamedia sent out its paper one day before the SW event. In it, the operator of TV 3 calls for a redistribution of advertising time (asymmetrical model): SRG should be allowed to advertise for six minutes per hour, but the private broadcasters for twelve minutes.
According to Armin Walpen, this asymmetry would result in SRG losing around CHF 150 million in advertising revenue, which roughly corresponds to the expenditure for the Ticino program. Moreover, it is not clear from the paper whether the halving would only apply to DRS stations or also to TV stations in French-speaking Switzerland and Ticino. The SRG boss doubts whether these 150 million francs will actually end up in the coffers of the Swiss private broadcasters. "Advertising has the stupid habit of not going where it is allowed to, but where it thinks it will find its target audience," he said.
Bakom Director Marc Furrer is also certain that Tamedia's proposal would see advertising flow much more to the major foreign broadcasters. "We are not so altruistic as to make a law that in principle favors the German and French private broadcasters," he said.
At the end of last year, Council of States member and SW President Carlo Schmid-Sutter submitted an initiative to liberalize interruption advertising and advertising for light alcoholic beverages for private individuals. When asked about this initiative, Walpen was generous. He said that the SRG was prepared to forego this option in favor of "the friends of commercial competition". Walpen also sees something objectionable in the fact that foreign broadcasters are allowed to advertise alcoholic products in Switzerland. In this respect, the SRG Director General supports the SW President's proposal.
*Piero Schäfer is
SW communication manager
Few reactions at first
After the last SW Parliamentary Talk in Bern, Ticino Council of States member Filippo Lombardi suggested continuing the series of talks at the session in Lugano. The RTVG was able to mobilize a remarkable number of interested parties: Over 60 guests came to the Hotel de la Paix.
After Marc Furrer, Director of the Federal Office of Communications (Bakom), had outlined the concept of the new law, SRG Director General Armin Walpen praised the basis for the legal text. It is excellent because it accurately reflects the realities of Switzerland. Even if he would have liked the SRG's performance mandate to be a little less demanding, Walpen also welcomed the clear mandate to provide a public service. The SRG Director General is also positive about the legislator's intention that SRG should continue to be financed by both license fees and advertising in the television sector. Walpen sees problems above all in the standards for implementation. Compared to the current situation, several restrictions and controls are planned. In particular, he wonders whether the state is not burdening itself with responsibilities that will ultimately overburden it.
Tamedia wants twelve minutes of advertising time per hour
Christian Staerkle, President of the Swiss Private Radio Association (VPS), welcomed the idea of dualism in radio (fees for SRG, advertising for private broadcasters). However, he questioned whether the proposed limited distribution of license fees to radios in mountain regions was the right thing to do. Staerkle considers advertising bans (for example for alcoholic beverages) for Swiss radios to be absurd as long as foreign stations can advertise cross-border for products that are banned here in Switzerland.
In principle, Staerkle considers the draft RTVA to be practicable. He has more reservations about television. Unfortunately, dualism is not envisaged here. This leads to a market distortion: as SRG is not only financed by advertising but also by fees, it can dictate spot prices on the market. This means that the fees subsidize the spot prices to a certain extent.
The consultation on the RTVA runs until the end of April. More and more associations and interest groups are currently publishing their opinions. Tamedia sent out its paper one day before the SW event. In it, the operator of TV 3 calls for a redistribution of advertising time (asymmetrical model): SRG should be allowed to advertise for six minutes per hour, but the private broadcasters for twelve minutes.
According to Armin Walpen, this asymmetry would result in SRG losing around CHF 150 million in advertising revenue, which roughly corresponds to the expenditure for the Ticino program. Moreover, it is not clear from the paper whether the halving would only apply to DRS stations or also to TV stations in French-speaking Switzerland and Ticino. The SRG boss doubts whether these 150 million francs will actually end up in the coffers of the Swiss private broadcasters. "Advertising has the stupid habit of not going where it is allowed to, but where it thinks it will find its target audience," he said.
Bakom Director Marc Furrer is also certain that Tamedia's proposal would see advertising flow much more to the major foreign broadcasters. "We are not so altruistic as to make a law that in principle favors the German and French private broadcasters," he said.
At the end of last year, Council of States member and SW President Carlo Schmid-Sutter submitted an initiative to liberalize interruption advertising and advertising for light alcoholic beverages for private individuals. When asked about this initiative, Walpen was generous. He said that the SRG was prepared to forego this option in favor of "the friends of commercial competition". Walpen also sees something objectionable in the fact that foreign broadcasters are allowed to advertise alcoholic products in Switzerland. In this respect, the SRG Director General supports the SW President's proposal.
*Piero Schäfer is
SW communication manager
Few reactions at first
Around 170 associations and organizations have been invited to consult on the new RTVA. So far, it has mainly been associations that are little affected by the law that have responded. According to Furrer, the reactions are quite critical. No wonder: the law is provocative. Federal Councillor Moritz Leuenberger has always said that he does not want to discuss the matter with associations in advance. He would draw his conclusions later. Nevertheless, the basic model of the dual system, strong SRG and more liberal regulations for private broadcasters, is largely approved of, according to Marc Furrer, head of Bakom.
