Spain's RTVE’s Lack of Advertising Leaves it With Deficit of $67 Million

The 2010 ban of advertising on the state-run broadcaster should be compensated by taxes on free and pay channels.


MALAGA -- Spanish pubcaster RTVE’s first year of television broadcast without advertising has left the network with a deficit of €47.1 million ($67 million), according to the Spanish daily El Pais Thursday.

The government had calculated a €400 million ($568.7 million) drop in revenues created by the 2010 prohibition of advertising on the state-run broadcaster would be compensated by a 3 percent tax on annual gross revenues for the free-to-air channels and a 1.5 percent tax on pay channels—in addition to the sale of certain broadcast rights for some €40 million ($56.8 million).

But thanks to a chain of miscalculations and last-minute impediments on the rights sales, El Pais reports the operating costs of €1.18 billion ($1.68 billion) exceeded the €1.14 billion ($1.62 billion) in revenues.

El Pais cites sources from RTVE pointing fingers at the commercial broadcasters for not correctly calculating how much they earned or using net earnings, rather than gross. According to the sources, broadcasters still owe €9.2 million ($27.3 million) and telecoms an additional €43.1 million ($61.3 million).