Bouquet of Barb figures adds to ITV pain

ITV has many problems at the moment, like falling advertising revenues, redundancies and budget cuts.

ITV has many problems at the moment, like falling advertising revenues, redundancies and budget cuts.

So it was bound to cause a row when the Broadcasters Audience Research Board (Barb) altered its method of measuring audience numbers, and revealed that ITV's figure in the first two weeks of January was 25 per cent down on the same period last year.

The number of people watching a programme is directly related to advertising revenue. The two companies behind ITV, Carlton Communications and Granada, need every penny they can get. Both reported ad revenues down at least 12 per cent last year, and 2002 is not predicted to be much better.

Coronation Street, a vital money-earner for ITV, also seems to have a smaller audience than previously thought. Barb figures say that on the final Friday in January, only 11.2 million people watched the programme, against 12.3 million on the same day in 2001. If the fall in the show's figures continues, ITV could lose out on nearly £40m in annual ad revenue, says the media-buying firm Carat.

But Carat was suspicious of Barb's figures, so last weekend it conducted its own telephone survey, which found that 14.5 million people were watching the programme.

Now Barb has hit back, claiming its method is more sophisticated. Barb has a panel of selected homes around the country where "black boxes" monitor what's being watched on the TV sets. This panel has now been overhauled for the first time in 30 years, and Barb says it will be more representative of the population.

But teething problems meant the new panel was smaller than it ought to have been, comprising 3,800 rather than 5,100 viewers. ITV says the figures may be more representative when it runs at full strength.

Despite the doubt about Barb's numbers, ITV's market share was already declining. Patrick Wellington, an analyst at Citigroup, explains: "There has been a relatively steady audience decline, quarter by quarter, from the 30.2 per cent level in the first quarter of 2000 to 25.1 per cent in the last quarter of 2001," he says. He has also calculated that ITV's advertising is more expensive than Channel 4 or Channel 5's, taking into account how many adults the ads reach. So companies could be even less willing to put their commercials on the channel.

Less revenue means less money for the programmes, which in turn threatens audience share even more, so ITV could be caught in a downward spiral. Even Pop Idol and a planned culling of unpopular characters in Coronation Street may not be enough to save it.