The government has launched a public consultation on Channel 4, seeking views on whether the broadcaster should move outside London and commission more shows from the nations and regions.
The consultation also asks whether Channel 4 should be able to make larger investments in production companies.
The 12 week consultation is pitched by the DCMS as an investigation into how C4 can contribute to regional economic growth, stimulate regional creative industries and better serve regional audiences.
It asks three key questions:
– To what extent should Channel 4 be based outside London, potentially including moving its headquarters;
– Whether more programmes shown on Channel 4 should be made outside London;
– Whether Channel 4 should be able to make larger investments in production companies to support the development of emerging talent, including that from the regions, and help bolster Channel 4’s future financial position.
The consultation exercise is pitched as part of the government’s broader policy objective of rebalancing the UK economy so it is less reliant on London.
It notes that Channel 4 already delivers significant public value in various ways, but says “there is scope for it to do more.”
“In particular, the government recognises that the growth in the broadcasting and production sector has not been evenly distributed, with more than two thirds of producers based in London and the South East. This limits the spread of jobs, prosperity and opportunity, not only in terms of regional growth, but also the representation of local views and interests on television.”
The document also says the DCMS plans to explore what other public service broadcasters, including ITV and Channel 5, can do to drive “strong creative clusters right across the UK.”
In 2015 C4 spent £152m on productions outside of London (of which £28m was in the UK nations), from a total original content spend of £455m.
Of C4’s total staff of 819 (at year end 2015), around 25 – 3% of the total workforce – are based outside London.
The document states: “The government believes that moving Channel 4 staff outside of London warrants detailed consideration – and that this consideration should include potentially moving its headquarters. Any move should be capable of stimulating a regional cluster – or strengthening an existing one – to create employment opportunities and enhance regional economic growth.”
The government is also seeking views on whether Channel 4’s regional production quotas should change, possibly with higher requirements to spend 50% of expenditure on new content from the regions.
The government is also looking at whether C4 can own larger stakes in production companies than the current 25% stake it takes when the broadcaster invests. It asks whether C4 should be able to take up to 49% stakes in indie. This, it says, could enable C4 to make a bigger impact in supporting the growth of developing small and medium-sized production companies around the UK, as well as supporting Channel 4’s ability to diversify its sources of income.
The document notes that C4 generates annual revenue of nearly £1bn, but relies on advertising revenues for 94% of its income, “making its business model highly cyclical and potentially also at risk from the changes to the broadcasting landscape”. 91% of C4’s advertising revenue comes from TV advertising and 9% from digital advertising.
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