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EDITIONS
Thursday, 17 October, 2002, 11:28 GMT 12:28 UK
Back to basics for Channel 4
Brookside Close
Has Channel 4 gone down a creative cul-de-sac?

Channel 4 is to cut up to 200 jobs and has recently axed Brookside, one of its most high-profile programmes. What has happened to arguably the UK's most innovative broadcaster?

A channel enjoying its highest ever peak-time ratings and investing record levels of money into programming would not appear to be in a state of crisis.


It has to slim down and go back to basics

Luke Satchell, Broadcast Now
But crisis is the word being used by some commentators to describe a channel which is about to reach its 20th anniversary with a round of job cuts that will leave few members of staff in a mood to celebrate.

Up to 200 jobs are to be lost at the company, about 20% of the total workforce, and chief executive Mark Thompson has said the savings in overheads would be ploughed back into programmes.

Highs

"This had to come. It got a bit too fat," says Luke Satchell, online editor of Broadcast Now.

"Not enough money was being spent was going on the screen."

Big Brother
Big Brother 3 was a ratings hit
It has been a strange 18 months at the channel - characterised by the highs of Big Brother 3 and the lows of having to axe Brookside from a prime-time slot.

Many commentators feel the channel has stopped doing what it ded best.

"It used to be about innovative programming but it has really lost its way," says Satchell.

Its original remit to be bold and innovative now seems part of a bygone age when Channel 4 was the new kid on the block, full of ideas and the daring to put them into action.

Slim down

But aside from the philosophical wrangles about the role of Channel 4 in the multi-channel world there are tangible problems.

Richard and Judy
Richard and Judy: Fish out of water?
Earlier this year the station posted its first ever financial loss, of 21m, and was forced to slim down its once bold Film Four operation, which produced hits such as Four Weddings and a Funeral.

There have also been headline grabbing failures of individual programmes.

The Big Breakfast replacement RI:SE has yet to capture the public's imagination and Richard and Judy still look uncomfortable in their Channel 4 surroundings.

Satchell identifies programmes such as Graham Norton and Richard and Judy as typical of the malaise at the heart of Channel 4.

"Spending a lot of money on a talent like Graham Norton for a five-night-a-week show is hard to justify when you cannot get the good guests five nights a week.

"Richard and Judy look like fish out of water. Where is the format for them to present?"

Leadership

Many of the problems being faced by Mark Thompson are a hangover from the era of former head Michael Jackson.

Under his leadership Channel 4 spent millions of pounds on hundreds of extra staff, as well as two new digital TV channels and hours of expensive American imports.

Add the cost of keeping Film Four afloat at a time when the hits seemed to have dried up and it is not surprising that the station is struggling financially.


What would Channel 4 be for if it didn't take risks?

Mark Thompson, Channel 4

"Jackson was riding the crest of a wave and put a lot of the money that was available back then into ventures that have yet to bear fruit," says Satchell.

"E4 and Film Four have yet to give anything back."

In fact, Channel 4's various ventures, including E4 and Film Four, lost 65m in 2001.

The big Jackson spend also coincided with a sharp drop in advertising revenue which hit all commercial channels where it hurts most - the wallet.

Eightyfive per cent of Channel 4's revenue is derived from advertising.

The advertising group Zenith accused it of "extravagance", claiming it was spending too much on generous salaries and new channels.

In 2000 the channel made a profit of 21.5m but 12 months later that had turned into a 21m loss.

That was "a direct result of a decline of 32m in advertising and sponsorship revenues", according to the channel.

Unlike ITV companies, Mr Thompson cannot turn to private shareholders to dig deep into their pockets to buy their way out of problems or sit back with the security of public finance like the BBC.

When he complained that his former employers at the BBC were swimming in a "jacuzzi of cash" it was with the woe of a man who has has tasted riches but must live off scraps.

Hardly surprising then that Mark Thompson has decided that what Channel 4 needs is to start again from scratch and push through what one commentator has called a "painful rebirth".

Upturn

Brookside is being given the last rites, Film Four has been emasculated, jobs are being shed - Mr Thompson is clearly in no mood for half measures.

"What would Channel 4 be for if it didn't take risks?" asked Mr Thompson.

"It has to slim down and go back to basics," agrees Satchell.

The fact Channel 4's problems coincide with an upturn in the fortunes of Channel 5 adds a slightly surreal edge to proceedings.

Satchell says: "Everyone will point to a ratings crisis. But the share (of the audience) has been very good and only occasionally is it beaten by Channel 5 in prime-time."

"Once the cuts take effect it will bear fruit."

See also:

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