Uncertainty as gambling D-Day nears

LONDON - New legislation governing gambling ads on TV and radio comes into force on 1 September. But have comments by new Culture Secretary James Purnell created cause for concern? Ben Bold reports

 

Last week, Culture Secretary James Purnell caused a furore after saying he was reviewing the relaxation of legislation governing gambling advertising on TV and radio.

Tony Blair and former Culture Secretary Tessa Jowell had passed legislation allowing gambling firms to advertise on TV from 1 September. But the new Gordon Brown regime has already made one major U-turn on gambling liberalisation by reviewing plans to build a so-called "super casino" in Manchester.

Then, on 15 July, The Sunday Times ran the headline Plan for gambling ads to be dropped. Cue: follow-up articles from the national and trade media sounding the death knell for gambling ads on TV.

But have the reports stirred up a storm that has genuinely damaging ramifications for gambling firms, media agencies and broadcast media owners, or just a storm in a teacup?

Advertising on TV and radio means new customers for gambling brands and a significant amount of revenue to TV and radio companies and agencies. Estimates for additional TV spend hover around £50m.

Remaining tight-lipped

But brands and their agencies are tight-lipped about their post-September plans. A spokesman for poker and casino website 888.com says that "broadcast advertising is something it is looking into", but nothing more.

There is a general feeling that consumers won't be barraged by gambling ads when they switch on their TV sets on 1 September.

Online betting exchange Betfair's managing director of corporate affairs, Mark Davies, would not comment on its plans. However, it is an area it is looking closely at.

"While we would be disappointed if the ban did stay in place, things would stay as they are as we can't advertise on TV now, so it would simply be a status quo," Davies says.

Even if no one is admitting it, many brands are set to launch TV ads from September. One unnamed insider from a major TV firm says: "We have several different gambling companies who will advertise on TV from September."

He adds that viewers can expect to see a lot of activity from a particular market sector, online poker.

So if The Sunday Times article proves accurate, what would be the impact of a continued ban?

A senior marketing executive at a TV firm points out that losing £50m in revenues that currently do not exist would be no massive loss.

"In the grand scheme of things, it is less than 1.5% of TV ad revenues, so the impact of a ban would be minimal," he says.

Betfair's Davies says: "We don't know what the potential uplift is of being able to advertise on television, so we can't say what the loss of potential uplift would be ."

However, no one Media Week spoke to indicated that broadcast media schedules had been shelved.

One senior TV insider dismissed media speculation, saying: "It is not a massive cause for concern. There have been seven years of consultation, so we don't think it will be changed."

Betfair's Davies is not overly concerned. He says: "We have to wait and see what the outcome is, but from a Betfair perspective nothing has changed."

The Advertising Association gave a tacitly confident reaction to The Sunday Times piece. Baroness Peta Buscombe, its chief executive, says: "It has been decided that advertising for gambling products and premises should be permitted, subject to the most stringent safeguards."

More control

However, one unnamed agency chief with a major gaming client, sounds a note of concern. "What will happen is that it will go ahead as planned and the Government will see what the consumer response is and pull it in a year's time," he says. "I suspect it will get pulled eventually because the pressure groups are so strong and there is an increasing desire by the Government to have more control."

With only five weeks before the new Gambling Act comes into force, a spokesman from the DCMS told Media Week that it "is too early to say what action [Purnell] will take".

This vagueness, married with Parliament going into recess on Thursday and essentially halting any new legislation until October, only reinforces the view that gambling advertising will be liberalised from September. But Purnell's comments in the media, however misconstrued, do highlight an important point: he will be keeping close tabs on gambling advertising and should standards slip, gambling ads on TV could be a short-lived phenomenon.

WHAT MINISTERS SAID

I will ensure that our new system of regulation, as it covers every aspect of casinos and other gambling premises - from advert-ising to checks on entry to controls on games and machines - will place public protection first,  James Purnell, Culture Secretary, 16 July, 2007

We are not complacent and will monitor the impact of the new rules. If they are insufficient to ensure proper public protection, the Government will consider using its additional powers to impose further restrictions, Richard Caborn, then Culture Minister, March 2007

It's clear that some ads have been breaking the existing law. I am not willing to turn a blind eye to this and have agreed with the Gambling Commission that we should crack down on advertisers and publishers who knowingly break the law, Tessa Jowell, then Culture Secretary, November 2005.

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