Media Forum: Is it time to kill off commission?

Is it time to scrap a system where media owners reward agencies?

Even when it's all honest, decent, legal and above board, there is arguably something anachronistic about commission - media owners rewarding media agencies for using them. It is bound to end up in the odd case of confused or misplaced loyalties.

And, of course, that suspicion is magnified a hundred-fold when you hear instances of the system being abused. And it is, regularly. The really shocking thing is not so much the fact that the odd scandal bubbles up now and then, but rather that such scandals are, in the broad scheme of things, relatively rare.

The latest case, courtesy of Telewest, only came about because the company is traded on the Nasdaq exchange in New York and the company's US accountants were unable to distinguish between (alleged) dubious dealings at the UK sales house IDS and what passes here for standard business practice at certain levels of the media industry.

The main commercial question many smaller media owners face is how they go about attracting a share of revenue greater than their share of audience.

Many will talk a good game about the unique nature of their demographic profiles and the innovative deals they can offer. In reality, however, some just cut to the chase and offer more or less cunningly concealed ways of rewarding media traders for giving them 'incremental revenues'.

A market leader such as ITV doesn't need to do this. Others do. You can hardly blame media owners for doing all they can to maximise revenues.