RTL Group Reportedly Ogling UK's Channel 4

20 January 2009

LONDON: Gerhard Zeiler, ceo of Europe's largest commercial broadcaster RTL Group, is amorously eyeing Britain's struggling Channel 4 with a view to combining the latter with its own UK operation, Five.

Like many an ardent swain, Zeiler is oblivious to the maiden's protestations, paying scant heed to last week's statement by C4 chief executive Andy Duncan that the two broadcasters were "oil and water".

Both channels are struggling in a declining ad market, with audience shares significantly below that of the nation's dominant commercial broadcaster ITV.

Zeiler's ardour is not quenched by the public service broadcasting obligations foisted on the state-owned (but ad-funded) C4. He told the Financial Times in an interview: "I see this [merger] as public-private partnership and I strongly believe PPP would work in the TV industry as in other industries.”

As to which would be the dominate partner in such a marriage, Zeiler acknowledged: "There is no question that the majority [shareholding] will be held by the [UK] government."

Although sharing similar business models, the output of the two channels' are chalk and cheese content-wise, with Five the uncontested winner in the cheese stakes.

But Zeiler says he would not wish a union to result in Four's dumbing-down – especially its news, drama and documentary programmes which he called "the DNA" of C4.

He rejected fears that there would be a clash of cultures. "The whole point [of a merger] is to run it as efficiently as possible with at least as much PSB programming as now, if not more, without spending more taxpayers' money."

There's a speed-bump, however, that could break the axle of a possible deal. Bertelsmann-controlled RTL is reportedly less than eager to inject cash into a merged entity.

Data sourced from Financial Times; additional content by WARC staff