Stealth Ads Cause “Scandal” at German TV

Michael Hedges August 1, 2005

The German term for product placement is “schleichwerbung,” and the director of one of the country’s largest public broadcasters calls it “the plague.”
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Westdeutscher Rundfunk (WDR) General Director Fritz Pleitgen and television Director Ulrich Deppendorf ordered dozens of films and television series episodes removed from the broadcast schedule. WDR is reviewing all productions over the past ten years.

WDR’s internal investigation determined that payments were made to place a certain weißbeir in one or more episodes of the crime/mystery series “Totort” (Scene of the Crime), produced by Colonia Media. As many as three companies paid €25,000 for undisclosed product placement. The series is broadcast on ARD channels throughout Germany.

“Product placement is the plague because it damages the business,” said Pleitgen, in an interview with Die Welt. “For the public it is fraud because they do not know who the sender of this or that message is.”

Bavaria Film, an internationally recognized production and distribution company, “relieved with immediate effect” production director Thilo Kleine. Two directors and the chief writer were also fired. Bavaria Film released information that nearly €1.5 million was paid for product placement in the soap opera “Marienhof” and hospital series “In Aller Freindschaft.” WDR is the largest shareholder in Bavaria Film of which Colonia Media is a 100% subsidiary.

The rise of product placement in marketing and media seems new, but it isn’t. Advantageous retail display and shelf-space has long been sold, the cost of getting product in front of customers. Early television featured characters and even newscasters brandishing strategically placed cigarettes. These practices generally disappeared from television as rules makers responded to popular concerns about advertising disclosures. The film industry never faced the same rules and when feature films as broadcast on television product placement is seen but not mentioned.

Blurring marketing and program or editorial content brings metaphysical joy to many advertisers. Product placement – in its many forms – can enhance a brand without an advertising stigma, gaining, its thought, credibility for the chocolate bar, bar of soap or beer at the bar. What better product promotion than viewers seeing popular TV characters actually using a product, and all without the dreaded publicity warning? European media rule makers adopted long ago, at national and the European Commission, an absolute wall between ads and content, at least in electronic media. To protect viewers, publicity had to be “announced” with a clear demarcation.

“We need new advertising possibilities,” said German Association of Private Radio and Television Broadcasters (VPRT) President Juergen Doetz in a June article in Die Zeit. Rather than strengthening rules against product placement, he favors complete legalization. Doetz speaks for many television broadcasters when he brings the dreaded personal video recorder (PVR), the device viewers can use to skim past ads. Widespread use of PVRs, it’s feared, will chase advertisers away from TV and toward other media, like the Internet. Legalizing product placement would keep money, if not 30-second ads, in television. The VPRT has also called for an ad ban on public television channels.

The German Newspaper Publishers Association (BDZV) is on record opposing any liberalization of advertising rules for television, public or private. The Frankfurter Allgemeine Zeitung referred to the stealth-advertising probe as “Watergate,” as media journalist Volker Lilienthal has done most reporting. 

Is stealth advertising confined to Germany? Nein! The Swiss Office for Communication (OFCOM/BAKOM) investigated public broadcaster SSR-SRG’s reality show “Traumjob” (Dream Job) for illegal advertising activity. “We want to know if “Traumjob” is illegally financed,“ said Director Martin Dumermuth in an interview with Sonntagszeitung at the end of May. On July 15th OFCOM ruled that rules were broken. It seems a resort hotel was featured in a two and a half minute clip during one episode but sponsorship not disclosed, contrary to law. 

Viviane Reding, DG Info Society and Media Commissioner, made clear as the EC drafts revisions to the Television Without Frontiers (TVWF) Directive that a line must exist between advertising and program content. At the same time she made equally clear that Europe’s broadcasters must be free to take advantage of any financial means to stem the onslaught of American television in Europe. The Commission as a whole is felt to favor greater liberalization.

Mrs. Reding is expected to present new rules on advertising and product placement, liberalizing both, in December. A DG Info position paper prepared for the September Liverpool conference on TVWF said, “the possibility of authorizing product placement is an option which would cover the development of the advertising market as it presently exists, whereas product placement today in fact operates without any regulated environment.” 

National regulators are as interested in product placement issues as broadcasters and advertisers. The European Platform of Regulatory Authorities (EPRA), an association of national regulators, has included sponsorship and product placement on the agenda of its October meeting in Budapest.

Product placement in the US is already approaching $2 billion a year. No similar figures are available for Europe where product placement is like payola from music labels to radio stations, illegal but hardly uncommon.

Speaking from an undisclosed tropical location, one American commercial television producer, when asked about the view of advertisers regarding product placement, said “it’s all about getting the message out there, baby.”

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Colonia Media Managing Director Resigns - August 8, 2005

Georg Feil, a noted TV producer and managing director of Colonia Media, submitted his resignation (August 2), according to the Frankfurter Allgemeine Zeitung (FAZ). The resignation is effective January 31st, 2006.

Feil has been active in German television and film for 35 years. His writing credits include the 1979 TV film Tatort on which the current series is based. He was also a producer of the series Marienhof. Both Tatort and Marienhof are subjects of investigation for product placement violations.

Bavaria Films board of directors suspended managing director Thilo Kliene in July as part of the investigation. Colonia Media is a subsiderary of Bavaria Films.