SRF 1/RTS 1: If TV advertising were banned after 8 p.m., the money would flow abroad

This is the conclusion reached by the Federal Office of Communications (OFCOM) in a report published on Tuesday. The Commission for Transport and Telecommunications (KVF) had ordered the report. It wanted to know what impact further advertising restrictions would have on SRF 1 and RTS 1. According to the report, around 90 percent of SRG's current advertising revenue would flow into products that do not produce journalistic content for Switzerland. This includes TV advertising windows, social media and other forms such as billboard advertising and corporate publications.

Google and Facebook

Swiss private TV stations could gain up to ten percent of SRG's current income from advertising and sponsorship. Most of the advertising revenue remaining in the TV advertising market would flow into advertising windows on foreign TV stations. International platforms such as Google and Facebook could absorb a significant proportion of SRG advertising revenue. The statements are based on workshops with experts and representatives of the TV and advertising industry. The report states that the advertising market is undergoing rapid change, despite regulatory changes.

Press with significant losses

Net advertising revenue in Switzerland amounted to a total of CHF 5.56 billion in 2016. Two thirds of revenue was generated by media with editorial content such as newspapers or television, and one third by advertising media without editorial content such as direct advertising and cinema advertising. Overall, advertising revenue has remained more or less stable in recent years. The press is still the category of editorial media with the highest revenue, but has suffered significant losses since 2011. From 2011 to 2016, its advertising revenue fell by around a third from around CHF 2 billion to around CHF 1.2 billion.

Linear television on the decline

Forecasts for the Swiss advertising market assume that the current trend will continue. The press will continue to lose advertising revenues, while radio revenues will remain roughly the same and those from the TV market will increase slightly. In the longer term, however, advertising in linear TV programs will lose reach and thus attractiveness. Online advertising is gaining in importance, but still has disadvantages compared to television. The overall advertising volume will decline slightly, according to the report.

Losses for the SRG

SRG reported advertising revenue of CHF 230.5 million in 2016. 115 million of this was generated after 8 pm and 26 million after 10 pm. If advertising were banned on SRF 1 and RTS 1 from 8 p.m., only a volume of around CHF 10 million could be shifted to the remaining advertising opportunities within SRG. If advertising were banned from 10 p.m., rebooking would be easier: spots worth 8 to 13 million could be switched to the remaining advertising opportunities within SRG. The bottom line is that a ban on advertising from 8 p.m. would lead to a decline in net advertising revenue of CHF 105 to 115 million, which corresponds to almost half of SRG's total advertising revenue. According to the report, a ban from 10 p.m. would lead to a decline in net advertising revenue of CHF 13 to 18 million.

Disadvantageous for companies

Such advertising restrictions would also be disadvantageous for companies that are primarily active on the Swiss market, such as Migros or Coop. The TV advertising market in Switzerland as a whole would also become less attractive. Further advertising restrictions for SRG were discussed in particular in connection with the No Billag initiative. In its response to a parliamentary motion, the Federal Council recently wrote that it wanted to examine such restrictions as part of the planned law on electronic media. (SDA)

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