So profits are down, ad revenue is down, and the ad market is “challenging” according to Michael Grade. The ink had scarcely dried on my “So, are people watching more or less TV?” post yesterday when ITV announced its figures. The key media soundbites were focussed on the profit drop, but the ITV revenue drop was the other big story; because revenue is driven by viewing figures and they reflect the size and quality of audiences being delivered. And the size and quality of the audiences in turn reflect the quality of the programmes being made and transmitted.
In my view both the BBC and ITV have produced some dire programming over the last few years. Reality TV has been a short term fix; it costs very little to produce (compared to real drama) and delivers reasonably good audiences - in other words it’s a highly profitable genre of programming.
Now whilst reality TV may be profitable, profitable programming does not build and maintain audiences. That’s the job of quality programming. In fact, there’s a positive correlation between the amount a programme costs to produce and the size and quality of audience it delivers.
Short term fixes, as profitable as they may be, carry long term consequences. I believe that this type of programming has changed consumers’ relationship with, and respect for, these broadcasters - particularly ITV. They are now perceived by many as peddlers of meaningless drivel. The problem is that once perceptions are set in one direction, they can be hard to shift to another. In other words these brands have been seriously damaged by this programming, possibly irreparably damaged. So even if Michael Grade can get his “eye back on the programming ball”, the audiences that ITV previously had for high quality programming will not necessarily return.
In addition, and most unfortunately for these broadcasters, this shift in the popular attitude to TV has coincided with an explosion of growth in self-scheduled media; the Internet, mobile media, ipods and pod casts. People’s expectation of media entertainment have also shifted - to a higher plane of personal satisfaction and reward.
Michael Grade is probably the only person in TV who can turn the ITV behemoth around. But the question is even when it’s pointing in the right direction, will it be able to catch up with everyone else?
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Goodbye to Michael Grade (for now)
Michael Grade is the man who bought us the Big Breakfast, Chris Evans, Jonathan Ross, Peter Kay, Big Brother, Time Team, EastEnders, Clive Anderson, Dennis Potter’s Lipstick On Your Collar, Friends, some really cutting edge episodes of Cutting Edge plus many other land mark events in UK television such as Football Italia and the financial backing of Four Weddings. But as well as providing support for new editorial ventures, he was also commercially successful. He found the perfect balance between editorial and commercial imperatives and guided the Channel into its most commercially successful years. TV thrives on a virtuous circle of great programmes delivering strong audiences which attract good commercial revenue. Grade placed Channel Four firmly on that upward circle.
The fact that Michael Grade cannot now crack ITVs problems is not a reflection on his ability, but an indicator of the scale of ITV’s problems. TV is in stormy water. Just as the talkies took over from the silents and the small screen took over from the big screen, and just as video almost squashed cinema and as cinema underwent a resurgence, so television is now having to ride the heavy seas of change. In these circumstances it needs a strong and visionary navigator at the helm. Unfortunately, talk of Grade’s replacement inevitably includes the old “merry -go-round” of senior TV executives, but for me none of these will do. To survive, ITV must look forward not backwards to the glory days, it must find a new definition of what it stands for and it must find a new way of monetising content across multiple platforms. These issues require experience from beyond the cosy world of television. To survive, ITV must go outside TV and into the wider communications market for its next leader.
Perhaps Grade is drawing on his family’s theatrical heritage and following that old dictum of the boards; leave the stage with them wanting more. One possible error is that he may have left that bit slightly too late.