RTÉ has ‘serious competitor’ in Virgin Media as TV ad market heats up

RTÉ and TV3 will be locked in a more even battle for commercial revenues this year as both broadcasters compete in a television advertising market expected to reach €243 million.

Virgin Media, which owns the channels TV3, 3e and Be3, is now "a serious competitor" to RTÉ in the fight to win share of advertisers' budgets, said ad-buying agency Core Media.

Core, which is Ireland’s largest marketing communications group, forecasts that 2017 will see the fourth consecutive year of growth in the overall advertising market, which it predicts will grow 3.3 per cent to €915 million.

Core Media chief executive Alan Cox said the projected figures were "good news for the industry" at a time of rapid technological change in the media world.

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Digital revenues will once again be the standout performer, advancing 13.5 per cent to €328 million, or more than a third of the market. But television will hold its own with growth of 2.5 per cent, while traditional linear channels will largely fend off perhaps overhyped competition for viewers' eyeballs from streaming services such as Netflix and Amazon Prime.

‘Outlook 17’ report

Virgin Media Solutions, the sales arm of Virgin-owned TV3 Group, can now compete with RTÉ on scale for the first time, Core Media said in its Outlook 17 report.

TV3 was the biggest channel in January with the industry’s “housekeepers with kids” audience category, in terms of its share of “commercial impacts” – a measure of how many times television advertisements are viewed.

The Ballymount-based group has been boosted by Virgin's acquisition of UTV Ireland, since rebranded as Be3, from ITV. The deal meant TV3 regained important rights to peak-time commercial workhorses Coronation Street and Emmerdale.

Its share of the advertising market exceeds its share of viewer ratings because it is permitted by the regulator to show an average of 12 minutes of ads per hour, compared to an average of six minutes per hour on RTÉ.

Media agency Carat has forecast that the three Virgin channels will together account for a 35 per cent share of commercial impacts, ahead of RTÉ at 34 per cent, with channels represented by Sky Media Ireland, the sales arm of Sky, taking 23 per cent.

The intensified competition between RTÉ and Virgin Media Solutions is “of significant benefit to advertisers”, Core Media said, and with €243 million at stake, there is “plenty to motivate” both camps.

Video-on-demand advertising will surge 27 per cent to €30 million, it also forecast, while the cinema market will rise 4 per cent to €8 million. Out-of-home advertising is expected to enjoy a decent year, expanding 4 per cent to €75 million.

Core Media and Carat have both forecast that print and radio advertising revenues will fall again this year after a difficult 2016 in which traditional media lost share to digital.

Core Media projects that print advertising will drop 9.5 per cent to €138 million, after a similar retreat last year, while it predicts radio revenues will drop 3.5 per cent to €123 million following a 6 per cent decline in 2016.