‘A dark day for public service’ as ITV sheds jobs
By politics.co.uk staff
ITV has announced it is to cut 600 jobs after revealing writedowns worth £2.7 billion, leading politicians to describe events as “a dark day in public service broadcasting”.
The commercial broadcaster said the job cuts were part of a series of cost-saving schemes including the suspension of dividend payments to shareholders.
ITV will spend £65 million less this year on programming compared to 2008 and freeze the programming budget for 2010, with further reductions expected the following year.
Liberal Democrat media spokesman Don Foster said: “Today is a dark day for public service broadcasting. ITV plays a critical part in our creative economy, not least by providing immensely popular shows, quality news and acting as competition to the BBC.
“Michael Grade’s resolve for ITV to remain a public service broadcaster is welcome. But unless the Government is prepared to loosen the regulatory noose around ITV’s neck then today’s announcement may well be the death knell of a much loved institution.
“Andy Burnham must stop grandstanding on product placement. The current restrictions on how ITV sells its advertising space and when advertising is shown as well as the ban on product placement must be reconsidered as a matter of urgency.”
On top of the cutbacks, ITV also plans to sell the Friends Reunited website which is paid £175 million for three years ago.
Net advertising revenues for the start of 2009 are also expected to be down around 17 per cent compared to the same period 12 months previously.
Michael Grade, ITV’s executive chairman, said: “Current conditions in the advertising market are the most challenging I have experienced in over 30 years in UK broadcasting.
“This is reflected both in our financial results for 2008 and the tough actions we are announcing today.”
He added ITV would write-off £2.638 billion related to its broadcasting, online businesses and GMTV.
Speaking this morning Mr Grade explained the TV advertising market had been significantly weakened over the last 12 months.
But said ITV’s cut-backs did not represent “indiscriminate cost-cutting”, but were designed to make the broadcaster a “leaner” business.
ITV also said targets set in 2007 were “no longer appropriate” and now planned to deliver annual savings of £155 million in 2009 and £175 million in 2010.