Michael Grade: “We will survive”
ITV’s chairman Michael Grade said the commercial broadcaster will survive the economic downturn, despite being “severely challenged” as a result of ad revenue cuts.
Speaking to the Lords Committee this morning, Grade said the industry as a whole is “facing a very serious reduction in ad spend”, which has had an impact on broadcasting and accelerated other problems, such as ITV’s public service broadcasting remit.
“It’s the worst situation that I can remember. I’ve never seen anything as dramatic or profound as this [in terms of ad spend],” he said.
Grade expects ad spend to fall by a further 5% – 10% in 2009, which he claims is a “pretty gloomy picture” for the television industry.
As a result, ITV has been forced to make a number of cost savings, such as cutting jobs and withdrawing funding from external training programmes.
Grade said: “We are making cuts at the moment but we’re trying to save as many jobs as we can. Painful decisions are being made.”
However, Grade also claims that the commercial broadcaster is only in a “temporary position”, which will change when the market starts to gather pace.
“We will be in a fitter state when the economy returns as a result of what we’re doing now. We’ll be thriving,” Grade said.
ITV has a number of plans in the pipeline that will help it overcome the downturn, according to Grade – such as pushing through Project Kangaroo (a joint VoD venture between ITV, Channel 4 and BBC Worldwide), a facility sharing partnership with BBC, creating a new entity to deal with the regional news issue set out by Ofcom’s recent PSB review and increasing ITV’s web offering.
ITV is looking to up its web offering in a bid to create a better opportunity for advertisers, as “huge numbers of users are drawn in by ITV’s content” on services such as ITV Player, according to Grade.
Grade also revealed that ITV has been in “deep and lengthy discussions with the BBC about sharing facilities, though savings will only be marginal,” he admitted.
However, he wanted to make it clear that the discussions are purely around sharing facilities, not joint editorial, in order to protect plurality – the results of the negotiations between the two broadcasters currently remain confidential.
Grade said he sees ITV’s future as a public service broadcasting provider, though with some conditions – he wants to continue to invest in good quality, valued UK content, innovate and deliver a service for the “best return”.
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