The SIG Column – 1 December

The threat of a pre-watershed ban on alcohol brands advertising on TV
has passed many in sport by but Drew Barrand, head of media at Sport Industry
Group, explains why they should start paying attention and quick.

’12 December. A parliamentary debate. Nothing unusual about that. But mark it
down in your diary because the outcome of that day’s events could rock the
sporting world more than any bung revelation.

Under normal circumstances, a charitable organisation such as Alcohol Concern
voicing its opinions in a House of Commons debate would be considered worthy but
not representative of any immediate threat to the legislative status quo. But,
in light of recent regulatory rulings, such protestations can now all too easily
translate into reality.

It may feel like hyperbole but let’s not kid ourselves that this is another
media induced exaggeration. The threat from Alcohol Concern’s long-held desire
to implement a total ban on alcohol brands advertising on TV before the 9pm
watershed is nothing new and, to this point, has been nothing serious.

But, fresh from Ofcom’s decision last week to ban junk food brands from
advertising around any programming that appeals to the majority of under 16 year
olds, the threat of such a ban now holds real potential to be fulfilled. Make no
bones about it, Ofcom has set a precedent and it wouldn’t be the
greatest surprise if Alcohol Concern pushed its agenda through on the wave of
the media regulator’s ground breaking decision.

So, why will this be a profound decision for sport? To understand this, you
just have to follow the money trail.

Any pre-watershed ban would affect all sports events taking place in the
afternoon as well as the first half of football and rugby games taking place in
the evening. In other words, the bulk of televised sport.

For the majority of broadcasters – be they terrestrial like ITV or pay-TV
like Sky – top-tier live sport coverage is considered a banker for advertising
monies. Despite what you may have read about ITV’s lacklustre World Cup
performance, it still produced substantially more income than any other
programming on the broadcaster’s roster.

Much of this advertising revenue comes from alcohol brands. Guinness,
Carling, Carlsberg, Budweiser, Heineken, Foster’s, John Smith’s, Magners. None
of these brands’ advertising would be seen before 9pm. The combined
multi-million pound total of the advertising budgets affected by the ban is
enough to make the broadcast world shudder.

The list of alcohol brands intrinsically linked to sport through sponsorship
or TV advertising is lengthy to say the least. Ripping such advertising from
underneath broadcasters’ feet will represent the most substantial hit to their
revenue streams they’ve ever encountered.

Follow the money trail further.

Substantially reduced advertising revenue means that broadcasters’ profits
are hit to a similar tune which in turn will translate into an ability to
maintain the current multi-million pound coffers that they invest in acquiring
the live rights to sports content. A major reduction in money raised from the
sale of media rights will then hit sport properties in the pocket which is where
the bottom line comes in.

Sports properties – and that includes governing bodies as well as the more
commercially minded independent leagues such as the FA Premier League – glean
75% of their income from the sale of media rights. In other words they’re pretty
dependent on it. Cut a sizeable hole in this revenue – which is what the result
of a pre-watershed advertising ban on alcohol brands would do – and you’ve got a
major problem.

All of a sudden, sport, including the high profile entities like football,
has lost its primary benefactor. Funding dries up. Grass roots and community
programmes fall into oblivion. The healthy lifestyle that charities such as
Alcohol Concern are so desperate to promote is left without one of its primary
resources – sport.

There are a lot of ifs and buts in this scenario and, as Formula One
discovered with the tobacco ban, there are other places for sport to look for
its sponsorship investment. Not to mention the fact that it takes a lot of
debate for suggested legislation to actually become law. But too many in sport
are sticking their head in the sand thinking such legislation will never happen.
It is a dangerous game to play. Just ask the junk food brands.

While the scenario described above may feel like a flight of fancy, it’s
closer to realisation than many in the industry believe. Undoubtedly the
charity’s promptings are driven by the desire to do good but it’s not always
clear that they have understood the true ramifications of their hard-line
attitude. Sport needs to step up to the plate to explain it to them before its
too late.’