Quiz channels and call television participation formats face further scrutiny and calls for more stringent regulation. The controversial channels could be reclassified as teleshopping services or lotteries as a result of concerns over consumer protection.
Channel brands such as ITV Play and Quiz Call make money from premium rate phone calls, but regulators are concerned that consumers could be exploited by programmes that promise prizes without revealing the real probability of winning.
Quiz channels are currently considered as editorial gaming and general entertainment programming by Ofcom. The UK communications regulator is planning to conduct a consultation to consider whether some of them should be classified as teleshopping or advertising services. In this case they would fall under the regulations of the Advertising Standards Authority.
A consultation is already under way from the Gambling Commission, which could see some formats reclassified as lotteries. This could mean that they have to publish their odds on screen and give 20% of their proceeds to charity.
To avoid being considered as a lottery, prize competitions are required to be games of skill, although many of the questions involved either seem to have very low expectations of their viewers or answers that may at best be rather arbitrary.
Some broadcasters offer free online entries to competitions which are required to have an equal probability of taking part, but this has a negative effect on revenues as viewers are increasingly playing along online.
A new Gambling Act will come into force in the UK in September 2007 which will give the Gambling Commission the power to prosecute broadcasters for running illegal lotteries.
Media consultancy Mediatique forecasts that the value of the interactive market in the UK will rise from £890 million a year to £2 billion in the next three years. That growth is predicted to come from expanding the call TV format into other platforms.
Whether such growth can actually be achieved is unclear, but it is already big business.
The call television genre first took off in Germany, but the UK now has a proliferation of such quiz channels. The bingo-style game show Avago was an early pioneer of the idiom and soon followed by others, with around twenty such services. Previously the province of a number of niche channels, major commercial networks are now exploiting the format.
ITV is expected to produce profits of £ 20 million a year from programmes such as The Mint which is broadcast overnight under its ITV Play brand. Initially launched on Freeview digital terrestrial television, it is now also available on the Sky satellite platform.
Channel 4 subsidiary Ostrich Media produces Quiz Call, which recently surfaced on its E4 channel.
Participation television has emerged as a potentially lucrative application of interactive television, which may require little more technology than a telephone and a television.
With television advertising revenues under increasing pressure, broadcasters are looking to exploit new revenue streams, but these only go so far to make up the shortfall.
There are concerns that so-called participation television formats could also be exploiting consumers. While they may extract revenue from credulous viewers, they are unlikely to build valuable long-term relationships with those that face large phone bills as a result.
A one-day conference on transactional television takes place this week in London, inviting some of the leading players in this emerging genre to debate the opportunities and issues involved in participation formats.