Page last updated at 17:26 GMT, Wednesday, 11 March 2009

Product placement on TV ruled-out

Child watching television
The option of product placement will be reviewed again in 2011

The government has rejected proposals to allow broadcasters to use product placement in programmes, despite collapsing advertising revenues.

The practice of brands paying to have their products featured on television shows and movies is common in the US.

But Culture Minister Andy Burnham said a UK ban would be maintained and that he would "consider all other avenues before allowing product placement."

Pact, the independent producers' trade body, said it was "a lost opportunity".

Chief executive of Pact, John McVay, said: "Product placement already existed in the UK through imported programmes, such as Lost and American Idol."

"Relaxing the usage of product placement would inject more than 72m into the UK television market in the short-term."

British broadcasters have been hit in recent years as viewers and advertisers have moved to the internet and digital channels.

ITV said last week its advertising revenues slumped almost 20% in the first quarter of 2009 on the same period last year.

Some advertising bodies had suggested product placement as one solution.

European Commissioner for Information, Society and Media Viviane Reding said she did not "understand the logic of the UK government".

"They are punishing UK production companies by not letting them have this revenue they heavily need to survive," she said.

'Confusing the lines'

"I am well aware that a number of commercial broadcasters are facing difficult economic times," said Mr Burnham.

But he said there was "a lack of evidence of economic benefits, along with very serious concerns about blurring the boundaries between advertising and editorial".

Andy Duncan, chief executive of Channel 4, supported the government's decision.

"We have consistently taken the view that confusing the lines between editorial and advertising raises serious issues of trust for viewers," he said.

"Relaxing the rules would deliver a marginal commercial benefit."

Voice of the Listener & Viewer (VLV), a body that represents consumer interests in broadcasting, also supported the government's stance.

"Product placement destroys trust; and the more 'subtle' that placement is, the more likely the viewer is to be deceived," said VLV chairman Richard Lindley.

Product placement will continue to be allowed in some video-on-demand programmes and in films and television programmes made outside of Britain.

The government's position on product placement will be reviewed again in 2011 and 2012.

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