MGEITF 2004: Channel 4 Confirms Intention To Link With BBC
Channel 4 has confirmed that it is looking to forge closer links with the BBC in an attempt to strengthen its position in the face of rapidly increasing competition from the growing number of digital channels entering the market.
The broadcaster’s recently appointed chief executive, Andy Duncan, told delegates at the Edinburgh International Television Festival last weekend that he is interested in bringing the two state-owned organisations closer together.
He said: “It is certainly the case that I am interested in talking to the BBC, but I will be looking at a wide range of strategic options to ensure that Channel 4 not only survives, but thrives in the digital age.”
Channel 4 has been performing well recently with the final series of Friends and the fifth instalment of Big Brother attracting record audiences. However, ongoing growth in the multi-channel sector forced the broadcaster’s share of viewing below the crucial 10% mark last year and it is now having to fight harder for commercial impacts (see Channel 4 Sees Audience Share Dip During 2003).
Duncan, who joined Channel 4 from the BBC in July, said: “If you go forward over the next ten years and we move to a fully digital world there are challenges that both the BBC and Channel 4 will face in terms of continuing to provide public service broadcasting when there are greater competitive pressures.”
He added: “I know people at the BBC very well and Mark Thompson obviously knows Channel 4 very well. There are clear areas where mutual co-operation between us could actually be very helpful in terms of saving money and being more effective.”
Duncan, who played a key role in the launch of the BBC-backed Freeview platform at the end of 2002, joins Channel 4 at a time when it needs to beef up its digital presence and diversify its revenue streams beyond traditional spot advertising.
He said: “A lot of people talk about digital switch over, but at the same time there’s also some major changes going on in terms of interactivity, in terms of broadband and so on. I think that Channel 4 can definitely work with the BBC and piggy back on some of the technical development work it has done.”
Duncan’s predecessor, Mark Thompson, made no secret of his desire to find a viable commercial partner for Channel 4. Earlier this year talks took place with Five about the possibility of a full scale merger that would unite the broadcasters’ sales houses.
Both Channel 4 and Five are rumoured to have appointed investment banks to explore the logistics of a potential link-up and speculation has been rife as to what shape the merged entity would take. However, negotiations never reached due diligence and it now looks as though things are cooling off.
Five’s chief executive, Jane Lighting, said: “There are a number of options that both Channel 4 and Five are exploring. We are in a situation where discussions have taken place, but the reality is that nothing is as far thought through as people would imagine.”
A merger with Channel 4, or another commercial broadcaster such as BSkyB, would provide a much needed boost to Five, which is also looking to future proof its long-term strategy. Last month the broadcaster’s largest shareholder, Gerhard Zeiler, said a decision would be reached within the next eighteen months (see Five To Link With Rivals For Survival In Digital Age).
MGEITF: 020 7430 1333 www.mgeitf.co.uk
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