AJ
From Media Guardian. Yes, clearly changing your name will cure all ills.
Quote:
Dan Milmo, media business editor
Wednesday August 9, 2006
The Guardian
ITV bowed to shareholder pressure and removed Charles Allen as chief executive yesterday, as the broadcaster's chairman said he might rename the company to distance it from the travails of ITV1.
Sir Peter Burt, chairman of ITV, said investors had demanded action following a "perfect storm" of poor ratings and falling advertising revenues at its flagship ITV1 channel. Sir Peter said shareholders had not specifically demanded Mr Allen's removal but had made it clear change was needed. "The investors were not happy with the way things were going and they made their unhappiness known ... They were not that specific [about Mr Allen] but they said something had to be done."
Sir Peter added that he might consider changing the ITV name. ITV1 supplies two-thirds of group revenues but the channel's advertising revenues are heading for a decline of 18% in September after a poor summer, while its audience share has sunk to a new low of 16.7%. "ITV is not just ITV1. It's ITV2, ITV3, ITV4 and various other areas," said Sir Peter. "I wonder if we should change the name of the company from ITV. It would be easier if we were called something else."
Mr Allen will hand over temporary control in October to John Cresswell, ITV's finance director, while the board has begun an immediate search for a permanent successor. Potential candidates include Dawn Airey, the managing director of channels at BSkyB, Andy Duncan, chief executive of Channel 4, and Stephen Carter, former head of media regulator Ofcom. Mr Allen will end his two-and-a-half year reign with a payoff of about £3m, consisting of a year's salary, a bonus of just under £2m and a pension contribution of less than £1m.
"Charles is a very able man and in many ways he is the victim of circumstances," said Sir Peter. "If the advertising market had not been quite so dire, the effect of our poor programming would not have been quite so painful. Or if our programming had been better, the advertising downturn would have been more bearable. Charles is almost the victim of a perfect storm."
Mr Allen described his departure as "amicable" yesterday and cautioned against a radical overhaul of the business. "We had a big investor presentation and the feedback was incredibly positive," he said. "The issue is: can the strategy deliver quickly enough while the transition from analogue to digital is going on. The strategy is delivering."
The outgoing chief executive has set the company a target of earning 50% of revenues from outside ITV1 by 2010 and programme production is being streamlined to focus on more profitable genres, with a new series of I'm a Celebrity ... this autumn.
However, investors are increasingly concerned that a business model predicated on broadcasting £850m worth of programmes to mass-market audiences is unsustainable, because digital television is scattering viewers across hundreds of channels and the return on that near-£1bn outlay is eroding. A top twenty shareholder in ITV warned yesterday that its problems may be so fundamental that a new boss might not be enough. Richard Marwood, at Axa, said the structural challenges facing the broadcaster might overshadow any appointment.
"Maybe ITV is doing all the right things, but it's just such a strong headwind that it will be hard to overcome," he said. "The share price is telling you that the market is not happy with the way the company is going, so any change in management will be perceived as being good. But it may be one of those situations where people get fixated on the person and it's not anything to do with them. It's not the man, it's the company."
Sir Peter said the US, where big networks still have significant audience shares despite increased competition, showed ITV had a future as a mass-market broadcaster: "I would say to the shareholder that 'you are wrong'. There is a valid future for a free-to-air broadcaster."
Shares in ITV fell 3.25p to 98.25p yesterday, ahead of today's first-half results.
Wednesday August 9, 2006
The Guardian
ITV bowed to shareholder pressure and removed Charles Allen as chief executive yesterday, as the broadcaster's chairman said he might rename the company to distance it from the travails of ITV1.
Sir Peter Burt, chairman of ITV, said investors had demanded action following a "perfect storm" of poor ratings and falling advertising revenues at its flagship ITV1 channel. Sir Peter said shareholders had not specifically demanded Mr Allen's removal but had made it clear change was needed. "The investors were not happy with the way things were going and they made their unhappiness known ... They were not that specific [about Mr Allen] but they said something had to be done."
Sir Peter added that he might consider changing the ITV name. ITV1 supplies two-thirds of group revenues but the channel's advertising revenues are heading for a decline of 18% in September after a poor summer, while its audience share has sunk to a new low of 16.7%. "ITV is not just ITV1. It's ITV2, ITV3, ITV4 and various other areas," said Sir Peter. "I wonder if we should change the name of the company from ITV. It would be easier if we were called something else."
Mr Allen will hand over temporary control in October to John Cresswell, ITV's finance director, while the board has begun an immediate search for a permanent successor. Potential candidates include Dawn Airey, the managing director of channels at BSkyB, Andy Duncan, chief executive of Channel 4, and Stephen Carter, former head of media regulator Ofcom. Mr Allen will end his two-and-a-half year reign with a payoff of about £3m, consisting of a year's salary, a bonus of just under £2m and a pension contribution of less than £1m.
"Charles is a very able man and in many ways he is the victim of circumstances," said Sir Peter. "If the advertising market had not been quite so dire, the effect of our poor programming would not have been quite so painful. Or if our programming had been better, the advertising downturn would have been more bearable. Charles is almost the victim of a perfect storm."
Mr Allen described his departure as "amicable" yesterday and cautioned against a radical overhaul of the business. "We had a big investor presentation and the feedback was incredibly positive," he said. "The issue is: can the strategy deliver quickly enough while the transition from analogue to digital is going on. The strategy is delivering."
The outgoing chief executive has set the company a target of earning 50% of revenues from outside ITV1 by 2010 and programme production is being streamlined to focus on more profitable genres, with a new series of I'm a Celebrity ... this autumn.
However, investors are increasingly concerned that a business model predicated on broadcasting £850m worth of programmes to mass-market audiences is unsustainable, because digital television is scattering viewers across hundreds of channels and the return on that near-£1bn outlay is eroding. A top twenty shareholder in ITV warned yesterday that its problems may be so fundamental that a new boss might not be enough. Richard Marwood, at Axa, said the structural challenges facing the broadcaster might overshadow any appointment.
"Maybe ITV is doing all the right things, but it's just such a strong headwind that it will be hard to overcome," he said. "The share price is telling you that the market is not happy with the way the company is going, so any change in management will be perceived as being good. But it may be one of those situations where people get fixated on the person and it's not anything to do with them. It's not the man, it's the company."
Sir Peter said the US, where big networks still have significant audience shares despite increased competition, showed ITV had a future as a mass-market broadcaster: "I would say to the shareholder that 'you are wrong'. There is a valid future for a free-to-air broadcaster."
Shares in ITV fell 3.25p to 98.25p yesterday, ahead of today's first-half results.
