RTL plans for major growth in Channel 5 programming fund

Channel 5's majority shareholder, RTL, is in talks with fellow shareholder United News & Media about substantially increasing programmings and marketing budget as it moves to establish the channel as a major TV platform within its European interests.

The extra programming funds will be in addition to the pounds 200 million announced earlier this year.

This move follows last week's shake-up of Channel 5's management, prompted by the departure of its chief executive, David Elstein.

Dawn Airey, Channel 5's director of programmes, replaces Elstein, and Nick Milligan becomes her deputy, while retaining his responsibilities for sales. Airey will also continue as head of programming.

Elstein's exit followed rumours of clashes with RTL's director of strategy, Richard Eyre. Eyre is expected to become chairman of Channel 5 if United News & Media follows through its disposal of TV assets with the sale of its 35 per cent stake to RTL.

Industry sources also say Airey was being heavily courted by ITV so Channel 5 shareholders were keen to make sure she would stay.

While Elstein has been credited with successfully spearheading Channel 5's launch in March 1997, Airey and Milligan are seen as the key instigators in building the channel's presence. It has a 6 per cent audience share.

Elstein said of his departure: 'My contract was geared to optioning my benefits as soon as I had completed four years in charge. I left it to the shareholders to choose the actual moment of exercise and they have acted at a time when the channel needs to take a deep breath, galvanise its forces and move on to stage two of its life.'

Perspective, p20.