ITV eyes Five – or is this another stage in the CRR fight?

The Sunday Times Business News reports today that new ITV chairman Archie Norman, a veteran dealmaker, is eyeing a takeover of RTL-owned Five to boost his station’s share of the shrinking terrestrial ads market in the UK.

Such a move would give ITV about 53 per cent of the market, thus making it even more unlikely that the Competition Commission will significantly relax the Contract Rights Renewal formula that prevents ITV jacking up its prices to advertisers if audiences fall.

But Norman may have calculated (or know) that the CC is not inclined to do ITV any favours when it publishes its CRR review in a couple of weeks’ time so this particular leak (which it surely is) may just be chest-beating on ITV’s part: help us out or we’ll get even bigger and nastier.

There seems little doubt that German broadcaster RTL would happily sell Five now that provisional plans to merge it with Channel 4 appear to have been scrapped. The station has never made any money and nor is it likely to. At its best it picks up unconsidered programme trifles that the others have overlooked, like the US CSI crime shows or Europa League football (boosted this year by the strong performance of Fulham and Liverpool). But there’s no evidence of a coherent viewer offer.

But ITV has recently taken full control of breakfast broadcaster GMTV (and bought BBC man Adrian Chiles to adorn the sofa) and Norman may reckon that another terrestrial land grab would escape the legislators.

New CEO Adam Crozier starts at ITV tomorrow but it’s safe to assume that Norman, although allegedly non-executive chairman, will continue to determine strategy.

Crozier will be left to cut costs while trying to keep programme boss Peter Fincham, who was surely a candidate for the CEO’s job, happy.

The savvy Norman may also be calculating that a new Conservative government would look more kindly on ITV’s finances and ambitions. Norman is a former Tory MP himself and Tory leader David Cameron once toiled as Michael Green’s PR man at Carlton Television, one of the two companies that eventually became ITV.

The Tories have already promised to cut broadcast regulator Ofcom down to size. Ofcom invented the CRR formula when Carlton merged with Granada to form ITV in 2004.

Norman’s predecessor at ITV, executive chairman Michael Grade, seemingly took the view that ITV could put its problems behind it just by being better. Norman evidently thinks a bit of dealmaking is required at Britain’s biggest advertising-funded broadcaster.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.

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