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Channel 4 profits down because of drift towards online
Channel 4 is failing to capitalise on a golden age of broadcasting because of declining advertising revenues.The channel's profits will be down by 70 per cent this year, from £66.8 million in 2006 to £20 million, according to preliminary figures. Advertising on Channel 4 fell from £706 million in 2005 to about £665 million last year.
Andy Duncan, the channel's chief executive, believes that the trend is due to a shift in advertising revenues from television to online media, the Times reports, and has called on the regulator Ofcom to urgently address its problems.
As more and more advertisers wise up to the effectiveness of online advertising, fewer are willing to pay the premium prices demanded by commercial TV channels.
The growth potential of internet marketing has been identified by Time Warner's internet arm AOL, which has switched from a subscription business model to one funded by ads.
AOL has made a $900 million bid for Swedish internet advertising firm TradeDoubler.
News and Public Relations news posted on 16 January 2007
