Channel 4 commits to pounds 200m spending on digital television

Channel 4 is to plough pounds 200 million into its digital TV and

online services, with a substantial part of that being invested in

E4.



The broadcaster has earmarked this investment despite a decline in its

operating profit of more than 25 per cent to pounds 33.8 million. This

decline was due to Channel 4 increasing its expenditure on digital TV

and interactive services last year.



Michael Jackson, Channel 4's chief executive, said: 'If we weren't

investing money in new services, I think people would be asking

questions.'



Referring to the formation of 4 Ventures, which will house FilmFour, E4,

Channel 4's online ventures, and its other commercial ventures, Jackson

said: '4 Ventures will allow us to manage these new businesses more

aggressively to ensure they open up new sources of revenue and offer a

return on Channel 4's investment, helping to insulate the core service

against more competitive times ahead.'



E4 is forecast to break even in four years' time and FilmFour, which has

about 450,000 paying customers, will need to increase this to about

800,000 to go into operating profit.



Channel 4 has set aside pounds 23 million for its internet ventures this

year and another pounds 23 million to be spent on its horseracing media

rights joint venture, Go Racing. The latter is scheduled to launch on

digital TV next year.



Channel 4's group turnover was up 12 per cent to pounds 716 million,

which the broadcaster attributed to strong ratings and revenue

performance. Programmes such as Big Brother, Da Ali G Show, So Graham

Norton and Trigger Happy TV helped the channel to boost its share of

ABC1 audiences, particularly in the 16-to 34-year-old age group.



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