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CCTV Restricts TV Advertising from Medical Sector

Sohu, 10/11/11

China Central Television (CCTV) has announced that CCTV-1 will cease broadcasting medical TV advertising after 6:00 PM beginning January 1, 2012, and its news and six other main channels will stop running advertisements for medical organizations altogether, including ads for cosmetic surgery clinics.

Numerous industry sources have pointed out that the move will not significantly influence CCTV's revenues since, as a state-owned broadcaster, its stations have aired comparatively few medical industry-related ads. Larger provincial-level broadcasters such as those in Hunan and Jiangsu have similar advertising policies, but industry sources say that if the same restrictions were to be implemented nationwide, many provincial- and city-level television stations would suffer as a result.

CCTV previously issued a similar directive to limit advertisements for alcoholic beverages. Also set to take effect next year, CCTV has said that only 12 slots will be available in future tenders for top Chinese rice wine ("baijiu") manufacturers, which will be allowed to continue to purchase advertising. Baijiu manufacturers beyond those 12, however, will only be allowed to sponsor public service announcements featuring their company logo and cannot include words such as "bottle" or "glass." A spokesperson for CCTV's advertising center confirmed that beginning January 1, 2012, only two advertisements for baijiu products will be allowed to broadcast each night between 7 and 9 PM.

Editor's Note: In mid-August, CCTV ran an expose on Baidu (Nasdaq: BIDU), criticizing the online search giant for allowing products from the weight loss, pharmaceutical, and other heavily regulated industries to easily pass the Baidu auditing system and have their advertisements placed online via the Phoenix Nest system. By further limiting its own broadcasting of medical industry ads, CCTV is strengthening its position to call on other media, like Baidu, to more tightly restrict the types and volume of ads they will accept from the medical and healthcare fields. For more background on this topic, please see "CCTV Expose Targets Baidu for Fraudulent Paid Search Ads," MD 8/16/11 issue.

Keywords: regulation TV advertising television CCTV CCTV-1 revenue

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