November 02, 2007 | Friday
“Google to eat our lunch” Michael Grade, ITV (watch your supper too!)
By Matt Brocklehurst, Head of Marketing in Marketing |PPC |Search Engines |Google
Michael Grade at this week’s MediaGuardian Changing Broadcast summit wasn’t feeling too well. He started off proceedings with talk of “Loser Generated Content” before correcting “Loser to User” and blaming the slip on a cold. Grabbed a few laughs but the Executive Chairman of ITV wasn’t joking when the subject once again turned to the internet and, of course, Google. Not only was Michael’s nose running his stomach was rumbling as he grumbled:
“Google and the other online giants are ready to eat our lunch”
Ready!? I think they’ve pretty much gobbled it up and are onto the coffees. The Times article he was referring to reported that:
“Google generated £327 million in advertising between July and September, compared with an estimated £317 million for all of ITV1 across the UK during the same three-month period.”
This, to me, is not a blip. Remember ITV had the Rugby World Cup that gave them a boost. From here on in I’m pretty confident that Google will be topping ITV in 2008 in the same way it pulled ahead of Channel 4 earlier this year. So what, if anything, can ITV and other commercial TV broadcasters do? Well the gloves could be coming off. Grade was pretty miffed on the Doubleclick planned acquisition:
““Google takeover DoubleClick and nobody blinks”
He complained that this still relatively new industry is not under anywhere the same level of regulatory scrutiny as broadcast. He’s got a point on this (though I’m coming at this from “a how can they keep a Search Marketing Agency Performics” perpective). But this is only one small part of a tidal wave changing the ad landscape. Questions on Google monopolies are missing the bigger point.
ITV must embrace online. They’re getting there but is it too little too late? In September, according to Grade, ITV.com got 5 million visitors and 2 million videos were streamed. He seemed on one hand to understand the complimentary opportunities. He glowed in the fact that the early mass YouTube views and sharing of Paul Potts – the eventual winner of Britain’s Got talent – snowballed interest into the broadcast programme to boost viewing figures. However, on the other hand, he also bemoaned it was illegal. Indeed I checked out the video and it is now been removed due to copyright violation.
Similarly are Grade and ITV worried that the online social network giants might eat their supper? This could explain why, according to the Guardian, the Friends Reunited site will ditch the £7.50 charge for a six month membership, which entitles members to contact other users of the site. Again, too little too late?
Since 2005 when ITV bought Friends Reunited for £120 million site members have dropped from 15 million to 9 million. According to Econsultancy:
“In August, stats from Nielsen//NetRatings showed Friends Reunited had just 2.1m unique users in the UK, compared to 6.4m for MySpace and 6.5m for Facebook.”
So yes it makes sense for ITV to drop the charges but it also made sense about 12 months ago plus they need to integrate the tools and features that make MySpace and Facebook so addictive. And yes it makes sense for ITV to put videos on demand on ITV.com. But it all seems a bit too much like catch-up. And what are they doing about what seems an obvious and massive problem looming round the corner – the fast forwarding through adverts using Sky+ and the like. According to Michael Grade:
“spooling through ads is not an issue”
Michael, I know you had a cold but that’s no excuse – “wake-up and smell the coffee!”
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