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ITV boss exits: questions raised about broadcaster’s future

Valerie | 24 Apr 2009, 13:31

Michael Grade has agreed to step down as executive chairman a year earlier than planned at the UK’s largest commercial broadcaster and will remain in a non-executive role.

Grade was appointed at ITV in early 2007 to help turn round the company’s fortunes and address the group’s declining advertising revenue and low viewing figures.

The announcement has prompted widespread media and industry reaction and commentary about the timing of this departure, his legacy and what the future holds for the broadcaster.

Whilst the city welcomed the news, their overall outlook for ITV is unoptimistic. The Wall Street Journal draws attention to the enormous challenge that has befallen the company in the shape of the most severe economic downturn in ITV’s history, and has seen its share price reach a low of 31p and its demotion from the FTSE 100 index of blue-chip companies.

One City analyst said of the timing of Grade’s departure:

“It is a sensible and natural break. You could argue that he failed where no one could have succeeded. He is leaving [ITV] in better shape than when he joined – if you look at ITV1, 2, 3 and 4 and regulatory progress – but market events conspired against him.“

The Independent believes that whilst Grade achieved some progress in reviving the schedule and restoring audience share, as evidenced by shows such as Britain’s Got Talent which has reached a global audience,  it steadily lost market share to rivals such as Sky and smaller digital channels and many key strategic and structural challenges remain. These are summed up by The Telegraph:

“... Should ITV remain a public service broadcaster, with its programming and regulatory obligations but wide reach, or become a commercially more free but more limited digital broadcaster? How should it take advantage of a hoped for relaxation in the rules surrounding how much it can charge advertisers, the so called contract rights renewal process?”

The Times asks how ITV can exploit and monetise content such as Britain’s Got Talent, which has made headlines across the world as a result of the “Boyle phenomenon”, but points out a key challenge:

“In Britain’s Got Talent it has precisely what it needs: a channel-defining, break-out, hit show. But for Grade, life at ITV could never be so simple. ITV plc does not own the show, and cannot benefit from the international revenues it generates. Its production arm does not produce it, nor is it filmed in its studios. The 100 million people who have viewed Susan Boyle on YouTube do so for free, highlighting ITV’s difficulty translating online viewers into paying customers.”

With the worst advertising recession in decades, ITV’s future is closely intertwined with that of the entire British commercial television sector. As speculation continues about a possible takeover, its future could well be determined by a potential bidder finally coming to the fore. Whatever the outcome, Grade will be remembered and credited for being the last of a dying breed.

MySpace chief exec steps down

Valerie | 23 Apr 2009, 09:59

Chris DeWolfe is stepping down as chief executive of MySpace, the social networking site he helped found six years ago but will remain an adviser to the firm.

The announcement from MySpace parent company News Corp. which acquired the company for $580 million in 2005, follows speculation about the departure leaked earlier in the week by TechCrunch.

The LA Times argues that the decision is significant, particularly as fellow co-founder Tom Anderson - currently the president of MySpace - is also in discussions over his future. The decision also follows the appointment of the former head of AOL, Jonathan Miller, to run its digital operations just a few weeks ago:

“The decision suggests News Corp.‘s growing dissatisfaction with the company that it acquired for $580 million but that is now losing ground to rival Facebook, which has been making rapid gains in users, even in the U.S., where MySpace has dominated.”

Myspace was an early front runner when the world of social media exploded over the past four or five years. When it launched in 2003, the site became immediately popular with musicians and other artists who used it to showcase their works before it moved towards the more mainstream.  However, as one analyst has pointed out, “the MySpace platform did not evolve. It was doing the same thing”. Facebook in contrast has been credited for pursuing change and taking its members along with it.

Recent comScore data ranks Facebook as the sixth most popular website in the world with 275 million unique users each month. Facebook now accounts for more than 30% of all time spend on social networking sites, an increase of over 12% from a year earlier.

Increasingly, Facebook and Twitter are overlapping, setting the stage for one of the biggest Silicon Valley rivalries over the next few years.

Budget confirms c&binet’s key role

Valerie | 22 Apr 2009, 16:12

The Government has pledged to continue its support of the Creative Industries in today’s Budget, highlighting the key role played by c&binet.

The report outlines the Government’s plans to build on its Creative Britain strategy published in 2008, which details how it will take action to support the creative industries. Key focus areas for 2009 include:

•  Publication of national best-practice advice on business support for the creative industries for Business Links in each participating region in June 2009

•  Publication of a toolkit of actions to help Local Authorities support creative industries in their areas by the Local Government Association and the Work Foundation in July 2009

•  First Creativity and Business International Network (C&binet) conference to take place in October 2009, to raise the international profile of the UK’s creative industries and address a range of issues of importance to creative sectors, including intellectual property

•  Improve the skills base of the creative industries, Sector Compacts with the Sector Skills Councils that cover the creative industries will tailor Train to Gain provision to meet the particular needs of employers

C&binet will be closely following the Government agenda and provide updates on key developments impacting the creative economy as they progress.

HBO to film TV pilot in Northern Ireland

Valerie | 21 Apr 2009, 15:59

HBO, the leading US pay cable network, will film a TV pilot in Northern Ireland this year.

Fantasy epic ‘A Game of Thrones’, is scheduled to arrive in the third quarter of 2009. It is expected that the production will utilise various locations, as well as build a massive set in the Paint Hall. The news follows a recent announcement from Universal Pictures that it was filming Hollywood blockbuster Y’our Highness’ at the same site in the city’s Titanic Quarter.

The news has been welcomed by the Northern Ireland Executive and film industry, which have highlighted the positive role played by the creative industries in helping to foster urban regeneration, particularly at a time of economic downturn.

First Minister Peter D Robinson, MP MLA said:

“This is the first time that a TV production of such vast size and scale has been filmed in Northern Ireland… It will be a welcome boost to the production sector, helping develop the industry here and bringing employment and investment to Northern Ireland.”

Culture and Arts Minister, Gregory Campbell added:

“Success in attracting TV productions such as ‘A Game of Thrones’ is vitally important in developing our local creative industries and artistic productions. Northern Ireland Screen is to be congratulated for their role in attracting this project and further enhancing the type of productions that are now being developed here.”

HBO programmes are broadcasted in more than 150 countries, including Sex and the City, Six Feet Under, Band of Brothers and The Sopranos.

Verdict reached on landmark Pirate Bay case

Valerie | 20 Apr 2009, 10:01

The co-founders behind one of the world’s most popular file-sharing websites, Pirate Bay, have been sentenced, the verdict allegedly leaked over the internet by a “trustworthy source” ahead of the official announcement.

In a landmark ruling for a trial that has been described as the “jewel in the crown of internet piracy”, the Swedish court found Frederik Neij, Carl Lundstom, Peter Sunde and Gottfrid Warg guilty of making copyrighted material available online. The four men have been sentenced to a year’s imprisonment and ordered to pay damages of 30 million kronor (£2 million) to several entertainment companies named in the lawsuit, including Sony Music, Warner Bros and EMI, who accused Pirate Bay of facilitating the illegal sharing of their copyrighted material.

The International Federation of the Phonographic Industry (IFPI), which represented music and film producers in the case, welcomed the verdict and said it believed it would have an impact on the continuation of filesharing.

In a statement, IFPI chairman and chief executive John Kennedy said:

“This is good news for everyone, in Sweden and internationally, who is making a living or a business from creative activity, and who needs to know their rights will protected by law.

“In the digital world we suffer from 90% piracy but it is still a $3.8bn digital industry that is more successful than newspapers, film or books. Even if we can move the needle slightly from 90%, it will be good.“

The Telegraph however, acknowledges that Pirate Bay is simply the latest in a long line of filesharing websites against whom legal action has been taken, with levels of online piracy showing no signs of abating. Music labels have, it observes, started to realise that “the best way of combating illegal filesharing is to beat the pirates at their own game – to fight free with free.”

Ben Perreau, chief executive and co-founder of Gigulate, a new UK startup which aims to match music news, blogs and gig listings against each other argues that the court ruling reinforces existing models for licensing when in fact the industry should be focusing on developing new ones:

“What is frustrating is that this doesn’t clear the way for music startups, it doesn’t help the industry and it doesn’t help musicians. It is helping these companies retame an existing model for licencing but what we’re hoping for is a model that helps artists get paid in a new economy where we know the market for recorded music is shrinking.”

Meanwhile, Jack Schofield at The Guardian asks whether Google and YouTube will be next in line to be targeted by the Federation of the Phonographic Industries and the Motion Picture Association of America, noting that there is no shortage of links to copyright information on Google.

In a digital age, the challenges relating to the protection of rights are not constrained by national boundaries which makes finding a global solution all the more important. C&binet will be taking an international lead on these issues when the forum meets in October for the first time.

Follow c&binet on Twitter

Valerie | 20 Apr 2009, 09:53

You can now keep up to date on all the latest c&binet blog updates and news via our live news feed on Twitter: http://twitter.com/cabinetforum.

Over the next few months and as we gear up for the first c&binet forum in October, we’ll be posting regularly on some of the most pressing issues in the global creative economy, including copyright, illegal peer-to-peer file sharing, the role of regulation, IP protection and new business models for the content generating industries.

To join the ongoing discussion, add your feedback or share your views, you can leave comments on the c&binet blog or follow us on Twitter.