Google Advertising revenues to pass UK Commercial TV Stations - Channel 4

By: Phillipa_Green

Google will earn more advertising revenue in the UK this year than Channel 4. Who's chief executive warned the TV industry that they had underestimated the threat from the internet. Andy Duncan said some traditional broadcasters had been slow to recognise the challenge posed by the internet and multi-channel TV, which cut into the audience and ad revenues of terrestrial broadcasters.

'This, reinforces that significant structural change has been going on and will continue to go on,' Duncan said.

Some broadcasters have been very slow to realise this. The industry as a whole is frankly rather backward looking and is perhaps underestimating the scale of change that is going on and the pace of change. Duncan said Channel 4, which is publicly owned but funded by advertising, had had an “incredibly good year”, increasing its audience share by 10% and boosting its share of the ad market. This made the comparison to the search engine all the more striking, he said.

According to Google's 2005 annual report, the United Kingdom accounted for £878 million ($1.68 billion) or 14% of the search engine's consolidated revenues.

A spokesman for Channel 4 said annual ad revenues for the group including its digital channels were estimated at around £800 million. ITV, the country's biggest commercial broadcaster, had an annual advertising revenue for 2005 of around £1.7 billion.

Channel 4 expects the TV ad market to fall by 6 to 7% for 2007, some broadcasters needed to put an emphasis on quality programming to prevent viewers from drifting to other forms of media. Channel 4 had also prepared for the impact of the internet by widening its service to provide video-on-demand, an improved website and mobile content.

The Internet Advertising Bureau (IAB UK) said last month that online advertising spending in Britain had jumped 40% in the first half of 2006 compared with a year ago, taking a market share of 10.5%.

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