Five cuts its programme budget by 25%

Five has been forced to slash its programme budget by 25% this year as a result of the ongoing advertising downturn.

The commercial broadcaster has reduced its budget to £165 million, down from £220 million last year, which is the biggest percentage fall of any broadcaster in the UK.

However, Five’s newly reduced budget still sits above Sky One’s budget of £140 million, though Sky is expected to up its programming investment in the coming months.

Five’s chief executive Dawn Airey said the broadcaster needs to think about consolidation because the market is too crowded to sustain them all.

Television revenues are still struggling and are yet to show signs of recovery, with all terrestrial channels recording double digit percentage falls in June, according to MediaTel’s agency estimates (see TV Market Round-Up – June 2009).

Five was the worst affected last month, dropping 23.5% year on year, taking its total commercial revenue down to £15.95 million.

Due to the decline in revenues, the broadcaster’s cost-per-thousands also fell across the board (among our featured audiences). The Male audience saw the biggest decrease, now costing £8.65 – 32.8% cheaper compared to June 2008.

However, Five’s commercial impacts bucked the general downward trend among rival terrestrial broadcasters, with all featured audiences improving year on year.