The Federal Trade Commission has opened a broad investigation into the methods television networks use to place advertisers on the air, and possible bias against regional advertisers.
The Cleveland office of the FTC is looking at complaints from serveral retional advertisers, including the Stroh's Brewery in Detroit, that net-works are charging higher prices to regional advertisers and giving them less desierable air times.
Almost half of the estimated $7.8 billion annual television advertising reveues come from local advertisers, FTC sources say, and many of those purchasers feel they are not getting access to key times, or adequate exposure to the top demographic viewing groups.
"Let's face it," said on FTC official knowledgable about the probe. "There is a very limited amount of television advertising time available, and it is a powerful medium. What we are looking at is who is being excluded from that medium, and why."
The investigation is somewhat similar to one conducted by the FTC's Bureau fo Competition three years ago, which resulted in the three major net-works being ordered to allow regional advertisers in different areas to get together to buy advertising time nationally.
Such a system-called brokering-would allow a single clearinghouse to buy a specific show, and then sell that time spot to different advertisers in each local market.
Strohs is said to be particularly worried about getting key advertising times onnational sports broadcasts, like major football games. Much of the key advertising time on such events-like the Super Bowl-is sold in advance by the networks to national advertisers, before regional advertisers are given a chance to buy any time.
The Cleveland FTC office is apparently handling the cases that are related," one FTC sources said.
"We are looking at several issues involving concentration of advertising sources, the difference between informative and non-informative advertising, and the difference advertising makes in general," the source said.
As an example, the source said, one beer company, Miller, has leaped from seventh to second in the beer industry in recent years, "and jst about all they did in order to do that was begin a massive advertising program."
"We woudl like to know if that kind of opportunity is or should be available to more than a few companies," another FTC staffer added.