A brand new report from the EBU’s Media Intelligence Service – Advertising Trends – looks at developments in the advertising market and in particular, how they impact PSM funding.
In 2015, online overtook TV to become the leading media overall in terms of advertising expenditure in Europe. Even though this trend primarily affects commercial broadcasters and media companies, advertising revenues are also an essential additional source of funds for PSM in many markets.
Over 80% of PSM organisations in Europe allow advertising in some form, although this is subject to strict limits in the majority of markets. The average share of advertising revenue to the funding mix is around 10% of the total, however this proportion has been shrinking over the long-term and is down from over 16% ten years ago.
The report gives an outline of the status of advertising expenditure, and analyses the trends and potential threats of the growing online sector, which is mostly fuelled by video and mobile advertising.
It also takes a closer look at PSM advertising, which is in some cases criticized for taking valuable revenue away from other broadcasters. However the evidence suggests that removing advertising from PSM does not benefit the national TV ad market. Advertising bans on PSM in countries such as Spain and France have resulted in advertising revenue moving largely to digital outlets and not to other commercial broadcasters.
Head of the Media Intelligence Service (MIS), Roberto Suárez Candel, says: “Advertising revenue provides a small but essential contribution to PSM funding in Europe.”
“With this report, we help our Members keep up-to-date with the latest developments in the market to ensure that this revenue stream is not lost, so that they can continue to innovate and deliver relevant and valuable programming to citizens.”