The company, which has a combination of free and pay-TV, continues to be very active in the UK market, concluding an agreement with BT in February to launch a sports pay-TV consortium, including BT Sport, which has rights to sports including the Premier League and the Champions League. However, ITV is pressing Whitehall over the possibility of a “national champion” takeover, designed to take on the political consequences of another takeover of a British “crown jewel” by a foreign owner. The issue for ITV, which said in the 00s that it would bid for Channel 4 if it was combined with another broadcaster as discussed with Channel 5, is that it would create something like a TV advertising monopoly with significant competition problems. There will also be significant interest from private equity buyers, although Channel 4’s mandate will need to be changed to allow a non-commercial buyer to make a profit from the business.
What is likely to happen on a privatized Channel 4?
Channel 4’s mission has never been to make a profit – the money it makes is reinvested in the outsourcing and purchase of programs by British television companies in particular, helping to support a key national industry. Analysts believe a privatized Channel 4 will face 40% to 50% cuts in its 60 660 million programming budget – spent on content such as news and current affairs, Gogglebox and It’s a Sin – to force its model into this one. commercial broadcaster. . This is likely to mean cutting-edge content that does not generate a lot of ad revenue, on which Channel 4 relies for more than 90% of 1 1 billion in annual revenue, such as news. Channel 4 is a key television commissioner from UK-based production companies and sees itself as a key part of the government’s ambitions to balance outside London. Analysts believe that 60 TV production companies across the UK could be forced to close if Channel 4 is transferred to private ownership.
Who owns Channel 4?
Channel 4 was founded by the government of Margaret Thatcher in 1982 to offer a culturally challenging alternative to BBC One, BBC Two and ITV. It is publicly owned but commercially funded. Unlike the BBC, which is funded by the 9 159-a-year license fee that its viewers have to pay, Channel 4 has no financial backing from the taxpayer.
What is Channel 4 worth?
While the 1 1 billion price tag is attached to the TV station during the latest push for privatization, it is very difficult to give a current estimate. Unlike competitors such as ITV and the BBC, Channel 4’s competence means it does not have its own production division. Although it has the rights to broadcast on its line-up and streaming services in the United Kingdom, the broadcaster does not have the rights to commercialize these broadcasts worldwide. The property of content to watch, “crown jewel” has been the driving force behind the wave of mergers and acquisitions in recent years. Any potential buyer would need to allow the Channel 4 model to change drastically to increase profit margins and business opportunities.
Has privatization been tried in the past?
Privatization in some form has been discussed about half a dozen times since the launch of Channel 4, with the most serious impetus coming under the government of David Cameron in 2016. It was led by then-Culture Minister John Whittingdale, who also oversees the latest government push for privatization. Eventually, it was decided that the benefits of the unexpected money for the government were offset by the scale of the detrimental effects on the independent television sector. In 2017, Culture Secretary Karen Bradley formally ruled out privatization, saying Channel 4 was a “valuable public good” that “will continue to belong to the country.” Instead, the government pressured Channel 4 to relocate significant parts of its business and staff outside London. About 300 of its 800 staff have now moved to new “national” headquarters in Leeds, as well as “creative hubs” in Bristol and Glasgow.
