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BizReport : Advertising archives : May 31, 2007

EU opens the door for product placement

A new deal in the European Union could open the door for new revenue streams for broadcasters. According to reports, audiovisual ministers in the EU are relaxing the rules surrounding television advertising to simplify product placements.

by Kristina Knight

Viviane Reding, EU Audiovisual and Media Commissioner said, "Product placement is a complete anarchy at the moment," she said. "It happens every day and there is no regulation of it. These rules will put things in order."

Product placements, like having a television sit-com star hold a can of Pepsi or buy a La-Z-Boy, are currently not allowed on children's shows, documentaries and news programs, but the rules governing product placements on other television programs will change.

Now when product placements are used they must be clearly identified at the beginning and end of a segment. Also, the commission made it clear that the content of the program should drive the advertising and not the other way around. Though it will now be easier for advertisers to place products within television programming, there cannot be a direct suggestion that viewers buy or rent the product or service.

This may not seem like a big change, but allowing more product placements on television is a huge step, especially with the way television is changing. More and more viewers are watching television online. By allowing product placements, advertisers have a kind of two-for-one shot: making consumers watching on television sets more aware of a brand and creating an online brand presence through online video.

The product placement spend is expected to rise to $4.38 billion this year.

Tags: online video, product placements, television

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