The digital challenge to the public interest: A policy analysis of the regulation of virtual advertising in the European Union

Virtual advertising (VA) is defined as the computer-processed placement of digital advertising or sponsoring images into a live or pre-recorded television broadcast signal. This new advertising technique challenges a fundamental principle in European broadcast regulation, which is the clear separation of advertising and (editorial) programming (Directive 89/552/EEC as amended by Directive 97/36/EC, Article 10).; This policy analysis examines the regulation of VA in four selected countries of the European Union (France, Germany, Italy, and the United Kingdom) and in the United States with the objective of producing policy-relevant information that might be taken into consideration by the European Commission for the anticipated revision of the Television Without Frontiers Directive.; Using political economy of communication and principles of policy research as broad conceptual frameworks, the analysis is informed by and contributes to the literature in broadcast law, policy and regulation. Processes and methods of policy analysis provide the methodological framework for the investigation.; Based on an in-depth analysis of primary data (statutes, codes, guidelines, policy documents) and secondary data (articles in trade publications and the popular press) and informed by background interviews with European regulators and industry representatives, the study addresses critical issues that have an impact on the future regulation of broadcast advertising in a digital, interactive, multi-channel television environment.; The study concludes that the current regulation of VA in Germany and the UK is an adequate, balanced regulatory framework that could serve as a model for EU-wide regulation. Moreover, the author proposes a re-evaluation of the outdated sponsorship rules and the increasingly artificial distinction between advertising and sponsoring. Further, the study reaffirms the importance of the "public interest" in the regulation of television advertising (esp. in the area of public health and the protection of minors) and proposes a more flexible approach to advertising regulation as a result of increasing viewer choice and control, "media literacy" and the already existing degree of commercialization in entertainment programming.; This comprehensive, interdisciplinary policy analysis makes both practical and theoretical contributions, addressing audiences in academia, media regulators and policy makers, television advertisers and broadcasters, as well as the public at large.