Grim 2012 for ITV

ITV is doing well in the ratings and might well enjoy a bumper holiday season helped by Christmas specials of shows like Downton Abbey. But a report from the media department at investment bankers Morgan Stanley suggests that 2012 is going to be extremely tough for the network.

ITV itself is assuming a flat 2012 in terms of advertising. The bank’s report says it, too, has zero growth in its forecasts. “Q1 [will be tough] and ITV is assuming down 10 per cent as its best guess (we are on 7.5 per cent). Thereafter the Euros kick in during Q2 and ITV may do better than our +1.9 per cent. Thereafter the Olympics and a strong autumn schedule helps Q3 ( but there is the absence of the Rugby World Cup). As an indicator our best guess is that January is down circa 6-7 per cent, February down 10-11 per cent and March down 6-7 per cent.”

“Advertiser behaviour is much as before with a lot of uncertainty, but no discernible negative trend and a tendency among buyers just to continue the existing spending pattern. One small ad-agency (Brilliant) went out of business in the last two weeks. It was bought by Mediacom so ITV’s exposure was covered but this type of event has the potential to upset the market,” adds the bank.

“We continue to think that ITV will announce a new cost-saving plan with the full-year figures in February. This is good housekeeping plus the fall-away of some digital switch-over costs. The move to Media City will incur some cost in 2012 but produce savings in 2013. Overall we go for cost savings of circa £20 million in 2012.”

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