Channel 4 is to be sold by the government ahead of the next general election after ministers decided privatization was the best way to ‘preserve’ the UK public service broadcasting sector.
Government officials said the commercially funded but state-owned broadcaster is expected to be put out to tender by the end of 2023, which could raise more than £1billion.
Following a consultation on Channel 4’s privatization, ministers have ruled that state ownership “holds it back in the face of a rapidly changing and competitive media landscape,” officials said.
In a statement, Channel 4 said it was “disappointed” with the decision, adding that the privatization “will require a lengthy legislative process”.
“Channel 4 has worked in good faith with the Government throughout the consultation process and demonstrated how it can continue to commission popular programs from the independent sector across the UK, representing and celebrating every aspect of British life, and its contribution to it increase society while preserving public property,” the broadcaster said.
Its executives have previously warned against jeopardizing the network’s public mission through “irreversible” privatization.
Ministers will seek to reinvest proceeds from the sale into a “creative dividend” – putting money into independent production and enhancing broader creative skills in priority parts of the country.
The channel remains a “public service broadcaster”, which means it has to commit to prime-time news.
A white paper policy document is expected before the end of the month and proposals for the sale are expected to feature in a new media bill in next month’s Queen’s Speech. Ministers hope to sell before the 2024 general election.
The channel derives more than 90 percent of its revenue from advertising, which supports spending on its mission to commission shows that appeal to younger, more diverse audiences and champion alternative views.
Since its inception in 1982, the so-called publisher-broadcaster model has enabled Channel 4 to fulfill its public service mission without having to resort to taxpayer support.
But it faces major challenges as global streaming services like Netflix, Amazon and Disney grab a growing share of the UK’s audience and production spend. Channel 4’s reach, which accounts for around 10 percent of viewer market share, fell by 3.7 percent last year.
Government officials said a change of ownership “will remove its straitjacket” and give the channel the freedom to “innovate and grow so it can thrive and prosper long into the future and support the UK creative industries at large”.
But Lucy Powell, secretary for shadow culture, said on Twitter: “Nothing calls for a leaderless government like this. Selling Channel 4, which doesn’t cost taxpayers a penny anyway, to a presumably foreign company makes absolutely no sense. It will cost jobs and opportunities in Yorkshire and hit our creative industries.”
Over the weekend the Government announced that Sir Ian Cheshire, currently non-executive director of telecoms group BT, will take over as President of Channel 4 later this month.
An established businessman, Sir Ian has held a number of private sector positions including Chairman of Barclays, Group Chief Executive of Kingfisher and Chief Executive of B&Q. In the public sector, he also held the position of non-executive director in the Cabinet Office.
The three-year appointment was confirmed by Culture Secretary Nadine Dorries, who praised Sir Ian’s “impressive track record at the helm of some of Britain’s biggest companies”.
“I am confident that his proven leadership will help Channel 4 go from strength to strength and ensure it thrives long into the future at a time of rapid change for the sector,” she said on Saturday.
https://www.ft.com/content/71b13628-083a-48e6-9343-ea7bab6b528c Channel 4 is set to be sold by the government for up to £1billion