Rejoice in the conclusion of another countdown for Channel 4
Two-and-a-half cheers for Michelle Donelan for choreographing the Government’s U-turn on the privatisation of Channel 4. It would have been three if she’d left it there.
Life has never been easy for Channel 4, the broadcaster with a unique combination of characteristics: public ownership, funded by advertising and almost wholly buying in or commissioning its programmes.
Almost from the launch on 2 November, 1982 with the first ever Countdown, rivals were reaching out trying to get control, not least of its finances.
As the Financial Times reported a few months later, the panjandrums of ITV were queuing up to interfere.
Hugh Dundas, then chairman of Thames Television warned there would have to be radical changes in the channel’s modus operandi and control.
David Plowright, managing director of Granada tried to dump ITV’s more public service programming on Channel 4, an aspiration echoed by London Weekend Television director John Birt who wanted to see “quality” ITV programmes moved to off-peak time on Channel 4.
A decade later, the then Channel 4 chief executive Michael Grade fought another skirmish with ITV and won the channel the right to sell its own advertising.
When did privatisation talk come into the picture?
By 2004, Grade’s successor Andy Duncan was agonising, rather presciently, over how to protect Channel 4’s public-service remit in the coming digital age. In a nod to tradition, he called it ‘Project Countdown’.
However, the biggest threat of all to the channel, lurking just below the surface, has always been the threat to its public ownership — from privatisation.
John Whittingdale had been a long-term ideological advocate of privatisation. I’d always found it rather odd given that in his youth, Whittingdale had been political secretary to Prime Minister Margaret Thatcher, who created the channel.
He made his most serious privatisation move in 2015 but was slapped down, almost certainly, by the then Chancellor of the Exchequer, George Osborne.
And then finally it really looked as if the privatisation moment had come thanks to the spite and vengeance of Prime Minister Boris Johnson and the number one member of his fan club, the effortlessly ill-informed Nadine Dorries.
Legislation was on the way, even though most of the small number in favour of privatisation came from the ranks of the ideologically pure or those who sniffed a profit from a cut-price sale.
There was even a minor scandal when the Culture Department put pressure, unsuccessfully, on the Channel 4 directors to amend its annual report to try to bolster the case for privatisation. Such interference had never happened before.
The facts were that Channel 4 was able to report a 25% increase in revenues last year to a new record £1.2bn, an 18% rise in pre-pandemic levels.
Moreover, the channel has £273m in cash reserves and £566m in net assets on its books. Sustainable or what?
Johnson and Dorries were of course swept away and now there was hope — but the outcome was still uncertain.
Enter Michelle Donelan and a media U-Turn
New Culture Secretary Michelle Donelan promised to review the issue and be guided by the facts but there was still some way to go.
Even if Donelan was to come down against privatisation she still had to get the climb-down past Prime Minister Rishi Sunak who had declared himself in favour.
Perhaps Donelan was able to activate Chancellor Jeremy Hunt to back her. As former Culture Secretary, Hunt would certainly have known the case for privatisation was flimsy to non-existent.
However she did it, many congratulations should go to Michelle Donelan — a politician, any politician actually guided by the facts of the matter is a rarity, particularly in this Government.
In the grand scheme of things, as Prime Ministers fall like skittles, the economy is trashed and hospital emergency departments look like war zones, it may seem like a very small victory for common sense.
But in the world of the media it is a huge U-turn, which should not be underestimated.
What is the Government now ‘imposing’ on Channel 4?
It is however, only a case of two-and-a-half cheers for Donelan, even though she got the big decision right. She did not quite have the political courage to do nothing at all and felt the need to put a bitter coating on the pill.
Politicians are very poor at doing nothing at all (especially when there is a Media Bill on the horizon) even when that is exactly what is required.
Some of the things now being “imposed” on Channel 4 are small and sensible, such as increasing the investment in paid training and placement programmes for young people from £5m a year to £10m by 2025.
Channel 4 will be equally happy to increase the number of posts outside London from its current 300. But increasing this to 600 within two years seems both a little excessive and more than a tad prescriptive.
To give Channel 4 easier access to its £75m credit facility and more flexible use of its £200m current borrowing limit is sensible.
The big problematic issue, which prevents Donelan dancing her way to a perfect score, is her decision to allow Channel 4 to produce and monetise its own content for the first time.
In a pointed response in an interview on Channel 4 News, chief executive Alex Mahon said the Channel had not asked for such a thing.
Interestingly, Mahon had appeared so infrequently on her own award-winning news programme that it was not entirely clear whether interviewer Cathy Newman managed to pronounce her name correctly.
Allowing Channel 4 to produce and own programmes also seems like a reasonable liberalisation, yet it could lead to considerable tensions between the broadcaster and the independent producers who provide most of its programming.
Forty years of a co-operative relationship will be replaced by a climate of competition — one in which smaller indies could get squeezed.
Will such a new competitive relationship be fair to indies? Or will the channel’s new internal commissioning teams, if that how it is organised, get their hands on the best ideas?
It might also open the way to a common abuse in broadcasting. Ideas are submitted and rejected and then, as if by magic, the in-house team produce an idea just different enough to avoid allegations of copyright theft.
To protect indies, Donelan will also increase Channel 4’s independent production quota from 25% without saying, for now, what the new figure will be.
It might have been less disruptive to extend Channel 4’s ability to take minority equity stakes in indie productions rather than pitting the channel against its main suppliers.
But let’s not quibble. Donelan did the right thing in overthrowing the silliness of Nadine Dories and swimming against the tide of this very right-wing Government.
Raymond Snoddy is a media consultant, national newspaper columnist and former presenter of NewsWatch on BBC News. He writes for The Media Leader on Wednesdays — read his column here.