What has happened
Television companies are facing the fiercest competition they have ever
encountered, and the challenges for the terrestrial or traditional broadcasters
are growing by the day with the explosion of new satellite channels.
The BBC is in the process of setting what is being regarded by some as its
last licence fee, as it becomes increasingly difficult to argue for the licence
based on the assumption that everyone watches the BBC.
For ITV the problem is that advertisers now have far more choice and the
competition impacts on the amount they can charge for each ad. The company’s
share price has disappointed the City since the controversial merger of Granada
and Carltoncreated ITV plc two years ago.
What happens next
New financial director John Cresswell, who took over from long-serving
Granada veteran Henry Staunton early last month, has joined at a turbulent time,
as a £1.3bn private equity takeover bid led by former BBC director-general Greg
Dyke failed when the company board rejected it.
But Dyke, supported by Goldman Sachs, Apax Partners and the Blackstone Group,
may come back with a renewed offer, and there may be other potential bidders.
Roger Parry, who chairs several media firms, ruled it out for the time being
after seemingly being poised for a bid launch. But he left the door open by
reserving the right to make an offer if circumstances change.
There are also rumours that US giants Viacom and Time Warner have been
watching developments closely for some time.
High on Cresswell’s list of priorities, as well as his boss’s, chief
executive Charles Allen, is arranging finance for a £1bn ‘sweetener’ for
shareholders who were angry about the rejection of the Dyke takeover. Non-core
assets such as 10% stakes in Arsenal and Liverpool football clubs, and Carlton
Screen Advertising could be sold.
There might also have to be budget cuts at ITV1, with the company resorting
to increased use of US dramas and producing less of its own programmes.
Cresswell, who is ACA qualified, will be very familiar with the issues facing
television companies needing to cut costs having worked in senior broadcasting
roles since 1987 (see his CV above). He was also the company’s chief operating
officer from the time of the merger.
SO FAR SO GOOD
John Cresswell’s CV
1987-1992: Financial controller TVS Television
1996-1998: Finance director Meidian Broadcasting Limited
1992-2000: Chief operating officer
2000-2001: Director of operations Granada Content
2001-2004: Chief operating officer and FD Granada Content
2004-2006: Chief operating officer, Granada and ITV
March 2006-To date: Financial director ITV
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