Tag Archives: five

The future of UK TV news — a regulator writes

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Here are Ofcom’s dis­cus­sion points from its Future of News paper (avail­able in full here).

Tele­vi­sion news can­not be taken for gran­ted on any com­mer­cial chan­nel after digital switch-over, because rev­en­ues gen­er­ated from advert­ising around news pro­grammes do not appear to cover costs of production…

…there are good reas­ons for exist­ing com­mer­cial PSB chan­nels to con­tinue deliv­er­ing national and inter­na­tional news ser­vices – even in the absence of oblig­a­tion. News pro­grammes attract respect­able view­ing fig­ures; they provide anchor points for nightly view­ing that other pro­grammes do not; pro­duc­tion costs are less than for many altern­at­ive pro­grammes; news is per­ceived to deliver status and cred­ib­il­ity to channels.

There must be some con­cern that fur­ther squeezes on budgets will affect the depth and breadth of tele­vi­sion journ­al­ism bey­ond the BBC. How­ever, com­mer­cial chan­nels wish­ing to retain their PSB status will con­tinue to be bound by a require­ment for ‘high qual­ity’ news pro­vi­sion. Will this be a suf­fi­cient safe­guard, and does it matter?

The tra­di­tional inter­pret­a­tion of ’plur­al­ity’ is begin­ning to be chal­lenged. Broad­casters them­selves con­sider the notion of ‘plur­al­ity’ in much broader terms than before – i.e. no longer simply in terms of other tele­vi­sion sta­tions. Is this ana­lysis correct?

Ofcom sug­gests that news should remain a cent­ral ele­ment of the Chan­nel 4 pub­lic remit for the future. This will guar­an­tee at least one altern­at­ive ser­vice from the exist­ing PSB tra­di­tion, in addi­tion to the BBC. Is this appropriate?

Is it neces­sary for news to also be a long-term pri­or­ity for remain­ing reg­u­lat­ory levers on ITV and Five? This might help to pre­serve ‘news in depth’ out­side the BBC – although in ITV’s case, news for the nations and regions might be a higher priority.

The value of TV news

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In case you hadn’t come across it, there’s a very good report [pdf] out from media con­sultancy Human Cap­ital on the value of news for UK com­mer­cial Pub­lic Ser­vice Broad­casters (that’s ITV, Chan­nel 4, and five), who all have to run news as part of the price of access­ing the van­ish­ing airwaves.

In an act of noblesse non-oblige, the report was com­mis­sioned by…the BBC! Be inter­est­ing to know exactly who at the Beeb com­mis­sioned it. As this chiefly impacts on ITN, it’s an act of bene­vol­ence akin to leav­ing a suit­case full of cash out­side 200 Grays Inn Road, ringing the door­bell and run­ning away.
There are some inter­est­ing nug­gets. Remem­ber this:

In terms of reach, news is import­ant in bring­ing in rel­at­ively upmar­ket, male view­ers to ITV1 and Chan­nel 4, who oth­er­wise tend to watch rel­at­ively little com­mer­cial PSB tele­vi­sion. These view­ers are valu­able to advert­isers and attract a premium. The abil­ity to extend reach is also import­ant because once view­ers visit a chan­nel, there is an oppor­tun­ity to pro­mote other pro­grammes to them. Moreover, the rela­tion­ship between reach and share sug­gests that, for the net­work chan­nels, a small change in reach can drive a large change in share. To the extent that news drives reach, there­fore, it is very import­ant to advertising-funded channels.

Yes, it’s a new way of re-stating the con­ven­tional wis­dom about ITV’s axed News at Ten — that its cent­ral ad break was the place to get middle-aged men to buy cars.

It also has two key obser­va­tions. First:

news plays a crit­ical role in extend­ing the reach of the chan­nel and defin­ing the channel’s brand…the role played by news in build­ing reach and chan­nel brand is likely to grow in importance.

Hmmm. I’d say influ­en­tial, rather than crit­ical. I don’t see Sky rush­ing to put a news half-hour in peak on Sky One. Or five offer­ing to restore a half-hour of news at 7pm. (Much as I’d wel­come those two moves.)

And second:

the oppor­tun­ity cost of deliv­er­ing news appears likely to fall – espe­cially for ITV1.

Oppor­tun­ity cost being the loss the chan­nel makes from run­ning news where it could run some­thing else. So PSBs will lose less money from the news than they do right now. Not a com­pel­ling reason to keep it going for­ward. But bet­ter than a trend in the oppos­ite direction.

So a wel­come doc­u­ment, but TV news execs may have to squeeze the cham­pagne cork back in bottle.

The declining price of broadcast news…

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ITV has just spun out a new deal with its news sup­plier, ITN. In case you don’t under­stand the oddness of Brit­ish TV news — ITV doesn’t have its own news divi­sion, it con­tracts the news out — and has done for fifty years — to a com­pany it 40% owns.

Accord­ing to the head­line it’s £250m till 2012. So will the cham­pagne corks be pop­ping at ITV’s and ITN’s HQ on Grays Inn Road? Maybe upstairs at net­work centre, but prob­ably not on the news­room floor. TV advert­ising rev­en­ues may be fall­ing across the board, but not as fast as the price paid for broad­cast news.

Here’s why. First strip out the £15m cap ex for stu­dio and equip­ment refurbs. That gives you £235m to play with. Take infla­tion at 3% and I’d say you’re look­ing at an annual deal in the region of £36.5m.

Now con­sider that the agree­ment cov­ers not just ITV News pro­grammes but the pro­vi­sion of local Lon­don news once under­taken by LNN. I’d reckon that’s worth about £6m — although you could squeeze it down.

So you have a national and inter­na­tional news ser­vice run­ning for just over £30m a year. When you look at ITN’s Chan­nel 4 News con­tract — which sits on the healthy side of £20m you can see just how little money this is.

Although the price of the ITV News con­tract suffered its biggest falls dur­ing the 1990s (threatened by com­pet­i­tion from Sky), by 1997 it was bring­ing in the equi­val­ent today of £60m. So over ten years the value of that con­tract has halved. In real terms it’s two and a half times the amount Chan­nel Five paid ITN for their ori­ginal news service.

Now tech­no­logy moves on, and sav­ings can be saved and costs trimmed. But ITN is a lean, mean news machine. On recent judge­ment it has prob­ably the most excit­ing lead­er­ship in TV news.

Still £100k a day to bring you the global, national and regional news is the steal of the cen­tury. If any­one at White City wants to know how they do it, per­haps ITN Con­sult­ing might help out?

Five News

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There are two types of com­mit­ments in life. Verbal com­mit­ments and fin­an­cial com­mit­ments. When gov­ern­ments make verbal com­mit­ments what do we judge them by? The money they’re alloc­at­ing to real­ise their dreams. When you’re nego­ti­at­ing what do you rely on? Prom­ises or prices?

Here’s a verbal com­mit­ment:

Chan­nel Five will offer view­ers ded­ic­ated slots on its news pro­grammes and will allow them to pitch ideas to pro­gramme exec­ut­ives on the inter­net, the channel’s man­aging dir­ector of con­tent, Lisa Opie, has announced.

…Ms Opie prom­ised view­ers “an unpre­ced­en­ted amount of input into the con­tent we produce.”

She prom­ised a “rad­ical relaunch” of Five News that would put cit­izen journ­al­ism at the “van­guard” of bul­let­ins. “We will integ­rate our news and talk pro­gram­ming across the day and we will be pas­sion­ate and cam­paign­ing on the view­ers’ behalf,” she said. [MG]

A fig­ure on the extra invest­ment cash that’s going to deliver this brave new world would help view­ers assess Five’s com­mit­ment to those goals.