Channel 4’s canceled sale sparks widespread relief but producers fear backlash

The British film and television industry breathed a collective sigh of relief today after the government announced it would cancel a proposed $1.2 billion sale of Channel 4, one of British broadcasting’s crown jewels.

Deadline understands that UK ministers could officially announce a U-turn on the privatization of Channel 4 tomorrow, with the decision all but endorsed by Rishi Sunak, the Prime Minister.

Leaked in a letter The News AgentsIn a daily podcast hosted by Emily Maitlis, UK Culture Secretary Michelle Donelan said: “To do a sale at this stage is not the right decision and there are better ways to ensure Channel 4’s sustainability.”

The decision comes 18 months after the government first floated the idea of ​​privatizing Channel 4. During this period, the British television and film industry waged a major campaign to keep the channel public.

Channel 4 has been publicly owned since it was founded in 1982 by Margaret Thatcher. The not-for-profit broadcaster has a unique mission to drive growth in the UK production sector – by outsourcing its entire programming to independent producers – and to take risks on innovative content.

Industry figures celebrated the idea that this attribution would be protected. John McVay, chief executive of producer trade group Pact, said he was “extremely pleased” with the decision.

“The government made the right decision to press the stop button on Channel 4’s privatisation. It was always a solution looking for a problem that didn’t exist,” he said. “Channel 4 has a unique position in the broadcasting ecosystem. The direct model has supported British manufacturing businesses from the start, employing thousands of people across the UK. A move to private ownership would have put it at risk.”

Leo Pearlman, founder and managing partner of Let you show Producer Fulwell 73 celebrated, but said it was “quite remarkable that undoing something that is clearly misleading to anyone who actually works in the creative industry is seen as a victory.” When Donelan’s predecessor Nadine Dorries polled the public about the plans, 96 percent of the roughly 50,000 respondents were against a sale.

Sarah Dollard, d Doctor who and Bridgeton Authors, summed up the vote more succinctly. “Thank you for that,” she tweeted. “Happy Happy HAPPY 2023” repeated Jack Thornethe author behind it Is dark material and HelpJodie Comer’s pandemic drama that aired on Channel 4 and streamed on Netflix.

“Logic prevails,” said Ben de Pear, former Channel 4 news editor and executive producer of For Sama, the Oscar-nominated documentary. “What a huge waste of time the whole exercise was. A low point in the Kulturkampf that hopefully will not have to be repeated.”

Kirstie Allsopp, presenter of Channel 4’s long-running property show Location, location, locationsaid: “Selling has always been a destructive, pointless project to be forgotten forever.”

Privatization gives way to internal production struggle

Relief at Channel 4’s sales halt was not unqualified, however, as the channel’s award-winning mission was set to change drastically. As part of efforts to ensure that Channel 4 remains commercially sustainable in the Netflix era, Donelan said in her letter that the company would be able to produce and own programs for the first time in its 40-year history.

The relaxation of Channel 4’s so-called publisher-broadcaster model could come as a blow to producers who exercised the broadcaster’s obligation to order content from third parties. Ministers must amend the law to achieve their aim, but Donelan said this would be done in consultation with Britain’s top manufacturing sector.

A senior industry source said talks were already underway with ministers, with producers pushing for an increase in Channel 4’s “indie quota” – the share of its £700m (US$843m) content budget dollars ) which is spent on truly independent manufacturing companies – to rise from the current level of 25%.

“It’s a bittersweet moment,” says the expert. “Privatization would have been a disaster for everyone, but now it’s about protecting the indie sector. We go into the room with the government to make the best possible deal.

Other manufacturers echoed this sentiment. “Independent manufacturing companies must be protected at all costs,” said Fulwell’s Pearlman. “Young talent, especially from the regions, must be given every opportunity to develop and new voices from all sectors of society must be encouraged and supported.”

Matt Graff, general manager of Amazon producer Zig-Zag Productions non-nationaladding: “While it’s clear that the channel needs to evolve if it wants to survive and thrive alongside the new streaming giants and changing viewing habits, it needs to do so in a way that not only fulfills its mission, but goes further by ‘ a culturally challenging alternative to UK terrestrial, cable networks and global streamers.

Industry sources said Channel 4 would likely be happy with the opportunity to produce its own programming as it aims to increase its revenue. A person familiar with the matter said it was an evolution of existing Channel 4 strategies, including the Indie Growth Fund, which enables Channel 4 to invest in small and diverse production companies. The Growth Fund’s previous holdings include Eleven, which made Netflix a hit Sex education.

Claire Enders, a media analyst who works with the government on broadcasting policy, argued that Channel 4 would reinvest profits from show sales into new content. “In a way it would be more beneficial for Channel 4 to keep the rights and reinvest them rather than automatically giving them away to producers who don’t all need that kind of help,” she added.

Channel 4 declined to comment on the government’s leaked privatization email. Alex Mahon, the channel’s chief executive, told employees to remain silent until an announcement was made.

“You may have read reports that the government no longer plans to privatize Channel 4,” she said in an email. “There can be no certainty about the outcome of our discussions with the government unless the foreign minister makes a formal announcement.”

A government spokesman said: “We do not comment on speculation. The Secretary of State for the Department for Digital, Culture, Media and Sport has made it clear that we are reviewing the business case for the sale of Channel 4. We will announce more about our plans in due course.”