By Colin Grimshaw, Marketing, 20 July 2005, 12:50pm

ITV audience slump puts £150m in revenue at risk

ITV stands to lose £150m in advertising revenue next year under Contract Rights Renewal rules, unless its autumn schedule can reverse a 9% slide in ITV1's audience at the 2005 half-year stage.

Such a loss would wipe out the £135m annual savings in its broadcast licence fee that was recently handed to ITV by Ofcom.

The broadcaster is relying on a turnaround in audience figures after a first half that featured a succession of ratings failures, including Celebrity Wrestling. Yet the prospects for an improvement are not good, according to media watchers.

ITV1's audience share declined in the second half of 2004, despite the inclusion of a ratings-grabbing series of I'm a Celebrity, Get Me Out of Here, which was supported by extra episodes of stalwart soap Coronation Street.

Andy Roberts, EMEA managing partner at Starcom, said there was evidence of ITV1's accelerating rate of decline. 'It puts the onus on ITV to increase its multichannel presence,' he added.

ITV4, its male-oriented digital channel, will debut on 1 November, but TV experts believe ITV needs to rapidly accelerate its digital strategy, perhaps by acquiring Flextech's 50% stake in UKTV.

ITV1 ended 2004 with its audience share down 5.6% on 2003, but halved a potential £100m loss in revenue by persuading some ITV1 advertisers to move onto ITV2.

Separately, Ofcom has sanctioned ITV after 126 viewers complained about the scheduling of a 150-second ad break during the closing stages of the San Marino Grand Prix on 24 April. Many of the complainants called for the return of Formula One coverage to the BBC. LG paid £3.5m to sponsor this year's coverage on ITV.