Commercial Broadcasters Train Sights on BBC

29 June 2005

British commercial TV and radio companies have met privately in recent weeks to discuss a possible joint stance toward the nation's state-owned broadcaster, the BBC, in the run-up to its Charter Review - due to take place this fall.

Among those determined to have their say over the future of their most powerful competitor are ITV, the largest commercial television broadcaster and its radio counterpart GCap Media, formed earlier this year by the merger of the UK's two dominant radio companies, Capital Radio and GWR.

Among a melange of differing agendas, the commercial companies have agreed to train their sights on the BBC's governance structure, more rigid competition barriers, and specific, regulated contracts for individual services.

Also involved in the cabal are the ceos of BSkyB, Channel 4 and Five. According to ITV boss, the former accountant Charles Allen: ""There seems to be common cause on a number of [issues] ... We are looking at the best way to make sure [those] common views are understood."

Although the commercial lobby is undoubtedly driven by a desire to neuter the BBC's competitive activities - it leads the ratings both in radio and TV - many impartial observers agree that the government's present regulatory plans are something of a dog's dinner.

One commercial executive, too shy (or partial) to be named, predicts that the government plans will lead to a "dysfunctional BBC" with fewer management checks and balances. Many critics want to see one chairman for the BBC, and another for its proposed governing trust.

Under the present proposals, incumbent BBC chairman, government-appointed Michael Grade, is slated to fill both roles.

  • ITV is also in the news on a different front - that of public service broadcasting, for long seen within the company as a dead weight around its neck.

    The Financial Times reports that unnamed ITV executives threaten that the company might withdraw from its PSB obligations if media regulator Ofcom fails to offer significant cuts in the £200 million ($365m; €300m) licence fee it currently pays for use of the analogue TV spectrum - the amount of which is under review by the regulator.

    Some analysts predict a cut of between £80m and £100m. But following talks with Ofcom and ITV, investment bank UBS recently emailed fund managers stating "... while the outcome is highly uncertain, we think there are a number of scenarios where savings are £50m to £70m better than consensus" [WAMN: 01-Jun-05].

    ITV maintains that an insufficient cut in its fee might adversely affect its ability to increase programme spending or return funds to shareholders.

    Data sourced from and Financial Times Online; additional content by WARC staff