The UK government has confirmed that Channel 4 will not be sold.
The decision represents a dramatic u-turn from Rishi Sunak’s Conservatives, who had previously been pushing for privatization against the advice of 96% of respondents to a government consultation on the matter when Nadine Dorries was Culture Secretary.
Dorries’ successor Michelle Donelan has since examined the business case for Channel 4 remaining in public hands and recommended a sale not be taken forward, which was rubberstamped by 10 Downing Street.
“Channel 4 is a British success story and a linchpin of our booming creative industries” said Donelan. “After reviewing the business case and engaging with the relevant sectors I have decided that Channel 4 should not be sold.”
In news that was leaked yesterday and obtained by The News Agents journalist Lewis Goodall, Donelan has instead issued a “sustainability package” containing an “ambitious package of measures” that will see Channel 4 able to produce shows in-house for the first time, increase skills investment and jobs outside of London and have its borrowing limit upped. How the in-house goal is achieved will be scrutinized carefully over the coming months by Britain’s production sector, many of whom have used Channel 4 IP as a bedrock to grow their businesses.
“This announcement will bring huge opportunities across the UK with Channel 4’s commitment to double skills investment to £10M and double the number of jobs outside of London to 600,” added Donelan. “The package will also safeguard the future of our world leading independent production sector. We will work closely with them to add new protections such as increasing the amount of content Channel 4 must commission from independent producers.”
Channel 4 CEO Alex Mahon said the “principle of public ownership is now set for the foreseeable future and will allow us to be even more of a power in the digital world.”
“Channel 4 is innovative, editorially brilliant and loved by audiences that others don’t reach, most of all the young and underrepresented,” she added. “In the analogue world, we did this spectacularly. Now, in the digital era, we are doing it again. Working with the world-leading TV and film producers of the UK, we continue to give birth to ideas that thrill audiences and change perspectives globally.”
Next steps
Mahon went on to say Channel 4 will “move faster, invest more, take more risks, break down barriers and push boundaries.”
Legislation will need to be implemented for some of the measures, Donelan said, and will be done via an upcoming Media Bill to “relax the publisher-broadcaster restriction in Channel 4’s remit so it has greater ability to produce and monetise its own content.”
Changes will be introduced “gradually with appropriate checks and balances and following consultation with the sector,” said the Digital, Culture, Media and Sport department press release.
Channel 4 is currently tasked with commissioning 25% of its shows from smaller “truly-independent” production companies and this will be increased in line with the in-house rule being relaxed, it added.
UK indie trade body Pact, which represents hundreds of UK production companies, said it was “disappointed,” however.
“Our main opposition to privatisation was the proposals around in-house production,” said a spokeswoman. “Any relaxation of Channel 4’s publisher-broadcaster status will be a blow to the sector, who are already facing increased production and business related costs. It is vital that there are suitable safeguards in place.”
Major victory
The move represents a major victory for Channel 4, which has spent the past 18 months preparing for the worst on privatization. It is the second time a sale has reared its head, with a similar scenario playing out in 2016 that ended similarly to this one. The network was launched under Margaret Thatcher’s government as a BBC and ITV alternative more than 40 years ago.
The prospect of no sale became rosier when Sunak took over as Prime Minister in October. Sunak is occupied with the mounting cost-of-living crisis while Jeremy Hunt, his Chancellor, has been vocally against a sale and would have had a major say in the final decision. Sunak himself was more lukewarm and said he would “take forward the plans” to privatize during his prime ministerial campaign over the summer.
Dorries tweeted yesterday saying “three years of a progressive Tory government” is being “washed down the drain” and listed the Channel 4 reversal as a factor.
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