Michael Grade, the chief executive of Channel 4, this week launched a
fresh campaign to break the funding ties that bind it to ITV.
At a major presentation to advertisers and agencies on Wednesday, Grade
said that the Queen’s Speech to Parliament this month will offer a
legislative window to abolish the funding formula that forces Channel 4
to hand over excess revenues to ITV.
The Queen’s Speech will incorporate a broadcasting bill, and Grade is
confident that Channel 4 has all-party support in Parliament for the
abolition of the formula. ‘I will not rest until our money is returned
to us,’ he said. ‘We do not need a subsidy. Why should ITV?’
Grade said that the most galling thing about the funding formula is that
it penalises Channel 4 for ITV’s problems. With ITV’s revenue expected
to be flat in November and December, Channel 4 will perform
proportionately better and Grade predicted that ITV’s slide will cost
Channel 4 an extra pounds 4 million to pounds 5 million in subsidy to
He also forecast that Channel 4 will take 11 per cent of total viewing
for the first time this year, ‘more audiences than ever at a time when
our major commercial competitor is perhaps not performing to the same
Grade dismissed the suggestion that Channel 5 would pose a significant
threat to Channel 4.
He said: ‘It will sharpen up everyone’s act - but I suspect its success
will depend on its ability to chip away at the mass ITV/BBC1 audiences.
We will continue to hammer away at the more discerning and younger end
of the market.’