Channel 4 validates advertisers’ privatization fears and offers to sell London HQ
Channel 4’s senior ranks have warned the ad industry that privatization is “no doubt going to be a concern” as it unveiled plans to attract £1bn in private investment and relocate from London.
Channel 4 has issued a warning to the ad industry / Channel 4
Speaking at a press briefing on Thursday (May 5), C4’s chief operating officer Jonathan Allan validated advertisers’ fears that a sale would harm the UK ad sector.
“Anything that potentially weakens Channel 4’s distinctiveness is no doubt going to be a concern to advertisers [and] agencies,” he said. “Because it may reduce the value of the audience that we bring to them, the quality of the programming and the kind of attitudinal demographics that represent Channel 4.”
He added: “I also think they’re right to be concerned about competition in the UK for the advertising pound; that becomes more of an issue if there’s a consolidation play. So I think that’s an issue that advertisers should be concerned about.”
Allan’s comments echo industry stakeholders such as the IPA, ISBA and agencies including GroupM, which have expressed similar concerns over consolidation and diverse audience reach.
In its first press briefing since culture secretary Nadine Dorries decided to privatize, C4 came out fighting by vowing to become the first northern broadcaster offering to sell its London Horseferry Road headquarters.
Speaking to the press, C4 chief exec Alex Mahon said she was “optimistic” as she outlined her ‘4: The Next Episode’ proposal, which would commit C4 to deepen its leveling-up agenda. Mahon revealed that the ‘4: The Next Episode’ plans were originally submitted to the government before privatization was set.
“In recent years, our focus has shifted to become about how you work across the UK. C4 has always been about how you focus on and appeal to people who might not otherwise get representation, that is quite far from a profit maximization (agenda),” she said.
“It’s not like I’m personally someone who’s against private capital [or] who is against making money in businesses. But I do know the impact it will have on Channel 4 better than anyone else in the world, having run it for four and a bit years.”
On the call, C4 also revealed its revenues grew by 25% to £1.2bn in 2021 with a surplus of £100m. Digital advertising grew by 40% in 2021, and C4’s share of the digital advertising market was 35%, ahead of its share of 28% on linear television.