Newspapers make depressing reading at the moment. We've seen
leading media owners across the board announcing downturns in
advertising and in the Financial Times this week a headline screamed
that ITV is to suffer its worst advertising slump since commercial TV
was first introduced.
While you can't help wondering if all the grim announcements are in
themselves becoming a self-fulfilling prophecy, there is no doubt that
times are tough and everyone is looking at ways to boost income.
So news of a leaked letter from Granada's chief executive, Charles
Allen, a co-owner of ONdigital, to Tony Blair saying that the digital
service faces closure if cross-media ownership restrictions are not
relaxed soon, and that Granada is increasingly at risk of being taken
over by an overseas investor, seems a rum affair.
ONdigital, which is soon to be relaunched, is already having its every
move scrutinised by a sceptical City. Allen's letter, which he sent
early last week after hearing that the Queen's speech would reveal the
Government did not plan a communications bill in the near future, seems
to be self-imploding dynamite in these testing times. And it seems
Carlton is none too happy with this move.
Of course, the story behind the story is that Allen didn't reckon on
those government leaks - despite leaks being its particular forte. It
was clearly not a letter he intended for the public eye, but a desperate
plea to the Government to rethink its policy on digital TV. Although
Allen acknowledges that Blair had planned to put back media ownership
rules before the Queen's speech, desperate times clearly call for
The leak has led to Granada's share price being eroded even further and
the cracks are now revealed to all. But you can't help being sympathetic
to ONdigital, even though you wonder if Allen believes that this kind of
foot-stamping is going to be acknowledged or drive the Government to do
The Government's inability to name a D-Day for analogue switch-off is
muddying the waters for companies, and while the key players should
stick their hands in their wallets to drive forward a strong consumer
awareness campaign, the Government should also take responsibility for
There is also the issue of why cross-media ownership is being held up by
the Government, and in this sense I'm referring to companies outside of
ITV. After all, since ITV has been allowed to consolidate to two and
dominate the commercial terrestrial TV landscape, why shouldn't
companies with interests in, say, radio and newspapers be allowed to
consolidate their presence? The Government may be playing a careful game
to try and keep all parties happy, but ultimately its passivity is more
likely to irritate than placate.