TVE defies ad ban to increase profitability

Juan Fernandez Gonzalez | 13-01-2014

Spain's public network TVE has found a way to increase profitability despite being prohibited from broadcasting advertising.

According to Kantar Media figures and information published by El Mundo, the network has increased ad hours broadcast by 11% during 2013 through finding sponsors for sporting and cultural events.

TVE is not directly earning money with this financial support, but will use such revenue streams to reduce programme production costs. Looking at the figures, over 76 hours of such programmes were broadcast in 2013, nearly ten hours more than in 2012.

The sponsorship formula has been extended during last year. Instead of having one single brand sponsoring an event, on some occasions two or three brands, whose ads are broadcast in a row, have been signed up.

The trend is most noticeable on La 1, TVE's main channel, but it is also occurring on La 2 and Teledeporte. The practice has been questioned in the past but has been defended by TVE's corporation as legitimate within the current regulations.

Spain's private channels, however, have reacted strongly to the practice. According to their trade body, UTECA, TVE is using the sponsoring as a financial source and this has led to unfair competition.