UK Government Sets Out Upsides Of Selling Channel 4 As It Fires Starting Gun On Privatization Review

Jake Kanter

22 June 2021 at 7:01 pm·3-min read

The UK government has put to bed months of speculation by announcing that it will launch a review to establish whether it should sell Channel 4, the British broadcaster behind hits like It’s a Sin.

Channel 4 has been under government ownership since its 1982 launch, but ministers argue that disruption from streaming giants has significantly altered the broadcasting landscape to the point where Channel 4 might benefit from private ownership.

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The Department for Digital, Culture, Media and Sport will oversee the review and consider whether “moving Channel 4 into private ownership and changing its remit could help secure its future as a successful and sustainable public service broadcaster.”

Noting the potential upsides of a sale, the DCMS said it would allow Channel 4 to access new capital, forge news partnerships and expand overseas. Ministers added that the broadcaster could “diversify its income streams” and invest in new technology and programming.

In an op-ed for the Times of London, culture secretary Oliver Dowden suggested that the government’s mind is already made up. “I will be proceeding on the basis that an alternative ownership model (but one where it keeps its public service remit) may be better for the broadcaster, and better for the country,” he wrote.

In an interview with BBC Radio 4, culture minister John Whittingdale pointed to Channel 5, which has benefited from increased investment under the ownership of ViacomCBS.

Channel 4 executives are not entirely convinced of these upsides and on Tuesday, in her strongest words yet on the matter, CEO Alex Mahon warned that a sale could irreversibly damage the UK broadcasting landscape.

The fear is that a corporate owner could seek to erode Channel 4’s unique public remit, which sees it reinvest its profits in UK content, commissioning programming from the independent production sector. It also has a mission to serve young viewers, spend money outside of London and champion diversity.

“You’ve got to think about how do you make those things stronger and stronger, and then balance that with what the optimal ownership structure is,” Mahon said. “We’ve always got to be careful of doing anything that might be irreversible, that could possibly damage some of those things that we do for the sector and that we do for the UK.”

It is hardly the first time that the Conservative government has considered privatization. Ministers most recently explored the idea in 2016, conducting an 18-month review that ultimately culminated in Channel 4 being asked to move out of London. At the time, Channel 4 said ViacomCBS and Discovery could be viable bidders.

Since then, ministers reportedly have decided that Channel 4 is “too woke,” and the broadcaster has clashed with the government. Notably, ahead of the 2019 election, Channel 4 empty-chaired Prime Minister Boris Johnson during a climate-change debate, replacing him with an ice sculpture.

One well-placed person told Deadline last year that the sale of Channel 4 represents “unfinished business” for Whittingdale, the culture minister. “Whittingdale can now, under the cover being concerned about Channel 4’s stability, entertain alliances which were probably not appropriate.”

Respected media analyst Enders delivered a withering verdict on the prospect of privatization. In a note on Tuesday, it said, “We believe that it will be difficult to maintain the remit with a new buyer paying any more than a meagre sum, and even if that happens, a profit-oriented buyer will have incentive to game the obligations.”

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UK Government Sets Out Upsides Of Selling Channel 4 As It Fires Starting Gun On Privatization Review