ITV: Beyond 2014 – a Public Service Broadcaster?

Good morning. I’m delighted to be here at this timely conference. It’s a critical time for broadcasting across the UK and here in Wales where many key questions – economic, cultural, technological and regulatory – are demanding an answer.

Everyone in the wider ITV plc understands that Wales has unique requirements when it comes to public service broadcasting in the UK.  There’s complete recognition that Wales has its own distinctive dual language culture, identity and devolved political imperatives. Over the decades the three PSBs here today have been competing and complementing each other to reflect these aspects of Welsh life to audiences.

ITV has a proud record of making programmes for audiences throughout the UK – not least in the provision of news for Wales and the English regions. We are extremely proud of our news services and even in today’s tougher and much more competitive climate we want to find a way to continue to support them on a sustainable, commercial basis.

We all know that times have changed. Under the old analogue system of broadcasting ITV’s very significant but otherwise uneconomic PSB contribution, including its extensive programming within Wales, was supported by access to analogue broadcasting spectrum worth many millions of pounds.

But in today’s digital multi-channel world where the explosion of online, mobile and social media has dramatically changed the ways people are consuming news, information and entertainment, things are far less straightforward.

Simply expressed, the value to ITV of analogue spectrum has fallen dramatically whilst the costs to ITV of PSB obligations has increased. A graphic example of the way in which regulated markets, in this case digital television, can outpace the ability of legislators to keep up.

But notwithstanding this, we are hugely proud of our news services and we want to find a way to continue to provide them in a way that makes economic sense for ITV.

Today, with a new senior management team in place at ITV plc and with our five year Transformation Plan providing a clear vision for the future, we are keen to continue to serve audiences in Wales with high-quality, well-resourced independent and impartial news and current affairs that competes with the BBC.

This objective is part of our “One ITV News” strategy, in which we have invested considerably, to produce high quality news services on television, online and mobile.

We have a desire to continue to improve and enhance our news services, but at a level of cost that ITV can commit to over the long term.

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More on this in a moment – but first I’d like to take a few moments to remind us all of ITV’s continuing contribution to broadcasting in Wales. Amid the debate over the effects of the public sector cuts on Wales’ other PSBs, this may have been overlooked.  Led from the front by Phil Henfrey, ITV Wales remains a key player in the Welsh media sector.

First the statistics: ITV Wales delivers four hours of news and 90-minutes of non-news programmes – most of them in peak or shoulder peak – every week.

Wales Tonight, our flagship news programme with our outstanding two lead presenters Jonathan Hill and Andrea Benfield, and our other news bulletins across the day on ITV1 Wales reach a million viewers every week.

The current affairs strand Wales This Week and factual series such as The Ferret and Fishlock’s Wales are also important parts of the schedule, delivering distinctive ITV programming to significant audiences. ITV Wales’ political coverage is better than ever with incisive political editor Adrian Masters very much at the Sharp End. And the annual Political Awards are an established part of the calendar.

These programmes appear on ITV1 – one of just two really big mass audience channels in the UK, home to Downton Abbey, the X Factor and Coronation Street – giving scale and impact for ITV Wales programming.

And let’s not forget that ITV Wales is also the producer of high-quality Welsh language programmes for S4C such as the current affairs series Y Byd Ar Bedwar and Hacio.

It’s been a remarkable year for news and ITV Wales has provided coverage of a number of events that have demonstrated popular journalism and programme-making of the highest order:

• Adrian Master’s Face to Face programmes delivered strong ratings and innovation to our coverage of the devolved powers referendum and the Welsh Assembly General Election;

• Andrea Benfield found herself at the heart of ITV’s acclaimed coverage of the Royal Wedding, reporting live from Anglesey;

• Following many months of painstaking work, Jonathan Hill secured exclusive access to the Pembrokeshire shotgun murders inquiry to deliver special programming for ITV Wales, S4C and the ITV Network.

But it’s not just about the special events. Audiences trust us to be there whenever and wherever the story happens in Wales. We saw that with ITV’s Reporter in West Wales – Kevin Ashford – anchoring ITV network coverage of the Chevron refinery explosion. And more recently the Gleision Colliery disaster saw ITV Wales journalists working alongside network news and Daybreak colleagues to deliver coverage of this terrible tragedy across Wales and across the UK.

And right now of course there is the Rugby World Cup where Wales’ performances have been one of the true highlights of ITV’s extensive coverage of the tournament.

The Rugby World Cup is a timely example of how ITV is covering a major global sporting event for audiences across the UK and, in Wales, tailoring coverage to the needs of audiences here. The coverage has offered a distinctly “Welsh voice” presented from our Cardiff studios with live contributions from rugby clubs across Wales and inserts from ITV Wales’ sport correspondent in New Zealand. This combination has proven to be highly popular with viewers in Wales with record audiences throughout the tournament. Saturday’s semi-final delivered an 88% peak share audience on ITV1 Wales – 918,000 viewers.

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All this has been taking place against a backdrop of key developments at ITV plc.

Structurally, ITV News today operates under one leadership team, coordinating all of ITV’s news output across the schedule including ITV Regional newsrooms, Daybreak News and the network news supplied by ITN. Nearly 500 journalists are employed across all of ITV’s news services. Nearly 100 work at ITV Wales.

The ongoing News Review has seen the first step in considering the future shape and structure of regional and network news.

One of the options we’re looking at is a potential integrated 6-7 pm “news hour” – delivering international, national and regional news in one coherent programme. We have already made some off-air pilots to test the idea. No decisions have yet been made on the way forward, but any changes would give a special role to news in Wales.

Let me be very clear there would be no reduction in the duration of the main Welsh news programme of the day.

Meanwhile, development work on ITV’s new online and mobile news service will continue. We’re taking an integrated, multi-platform approach in all our newsrooms where journalists can create content for both television and the internet. The full launch of our new service will take place in the first half of 2012.

The wider backdrop is, of course, the future make-up of our valued PSB system and how this will impact on Wales in 2014 when the current Channel 3 licences expire.

It is our clear view that sustainable Channel 3 licences are in the public and viewer interest, allowing us to continue to satisfy the high level of demand from our audiences for free, universal access to popular original British programming together with accurate and impartial national, regions and nations news services providing plurality to both the BBC and Sky.

Recently in its statutory advice to the Culture Secretary on licence renewal, Ofcom put forward a number of options, including a possible separate licence for Wales post-2014.

And Ofcom has said that regulatory certainty may help to provide the stability that would enable broadcasters to take creative risks and make the investment to support PSB delivery – and, naturally, we agree with that.

We’re all aware of the pressures the public spending cuts are having on our publicly funded broadcasters and their potential impact on services. The pressures on ITV are different if no less challenging as the TV advertising market on which we have been traditionally over-reliant remains volatile.

A key part of our five-year Transformation Plan – which I will touch on later – is finding and exploiting additional new revenue streams to help future-proof ITV as a free-to-air commercial broadcaster.

Let’s not forget that ITV is an important contributor to the UK creative economy and the country’s largest commercial investor in UK television content.

We’re making long-term investments in content and technology to help transform the company to meet the challenges of the highly competitive and fast-changing world of digital media.

We’re also a significant exporter of UK programmes to broadcasters around the world and we plan to increase international sales and presence.

But in order to enable us to sustain these investments – and to continue to provide effective competition to the BBC and BSkyB – we’re asking Ofcom and the Government to provide longer-term certainty for commercial public service broadcasters through sustainable licences that reflect the market we are in today

The starting point is self–help. We are now a year in to our five-year plan for the transformation of ITV. Our vision is for a lean ITV that can create world class content, provided across multiple platforms – both free and pay – and sold around the world.

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Part of this vision is the continuing importance of news in the nations and regions of the UK.

And clearly, another crucial part of the ITV’s contribution to the UK as a whole is its role in ensuring plurality in the provision of high quality, impartial and widely accessible news – a topic which is more hotly debated today than ever before.

ITV is the second largest news provider in the UK, investing over £100m a year in national, international and regional news and uniquely placed to provide choice for consumers and competition for the BBC and Sky.

The Government’s plan for the development of Local TV stations is an interesting new development in the UK broadcasting ecology.

However, for the foreseeable future there will clearly still be a public policy case for

• high quality, commercially-provided, impartial nations and regions news

• offering well resourced professional journalism

• reaching large audiences

• providing an alternative voice to the BBC

• covering all of the UK – including specific services for Wales, Scotland and Northern Ireland.

Channel 3 nations and regions news services continue to serve large audiences across the UK and compete head-to-head with the BBC. In 2010 the 6 pm regional and nations news programmes on ITV1 secured an average of nearly 3.3 million viewers – an average 18% share of the audience at that time.

Ofcom’s figures show that over 80% of people believe that it’s important for there to be more than one provider of regional/nations news, and that figure rises to 90% in the devolved nations.

So we know that guaranteed plurality in high quality news services is highly valued by viewers and will continue to be an important part of the UK democratic process for the foreseeable future.

Over the coming months ITV will be continuing discussions with Government and Ofcom regarding the Channel 3 licence proposals as we look beyond 2014.

To conclude, ITV believes that decisions relating to the commercial PSB licences should be a key priority for government to ensure that the guaranteed free provision of key existing regional and national TV news services for viewers in all parts of the UK continues.

In Wales, this would mean the continuation of a highly valued television service that has been part of the lives of audiences for the past 50 years.