Examination of Witnesses (Questions 120
- 139)
WEDNESDAY 11 JULY 2007
Mr Chris Shaw and Ms Sue Robertson
Q120 Chairman:
Just to go back to the question you heard me ask Channel 4, this
£10 million a year that you spend on news, which is not an
insubstantial amount,—
Ms Robertson: In terms of our overall programme
budget, which is around £200 million, you are looking at
around 5% of the overall programme budget, which is roughly what
you heard from Channel 4 in terms of what they spend on their
news, but I think their overall programme budget is over £400
million.
Q121 Chairman:
Did you agree with what Channel 4 was saying, that if you ran
this as, if you like, your own outfit you would not be able to
make it profitable? How do you view news?
Mr Shaw: I did not like what Dorothy said about,
"I am proud to lose £10 million", as a sort of
badge of public service honour. I would like news to make money
but it is true it is very difficult to make news make money.
Q122 Chairman:
But you do not make a virtue of it?
Mr Shaw: No. I do not see any reason for it
to be virtuous not to make money. Anyway, that is a personal opinion.
I do not think we do make money out of our news. It is very complicated.
I do not find doing the kind of cost value analysis of any programme
worthwhile because advertising gets shifted around the schedule,
depending on where most viewers are and how the regulation divides
it up across the day, but we do have adverts in the middle of
our news programmes and if we were allowed to sponsor them I am
not saying we could make a lot of money but I think we could get
close to breaking even.
Q123 Chairman:
If the news was sponsored by ... ?
Mr Shaw: If we had an American system where
we were allowed sponsorship of the news.
Ms Robertson: But we are not saying that is
what we want.
Mr Shaw: No. I am just saying that it is possible
to make money out of news but not under current regulation.
Q124 Chairman:
So you are not saying that is what you want but that is how you
could do it. Why do you not want to? What is the difficulty?
Ms Robertson: There is a whole other debate
about another company sponsoring your news programme, and whether
or not there is an editorial link between a sponsor and a news
programme. We have not even had that debate; so it is not something
we are looking to do.
Q125 Chairman:
Unless you do go down that road, which you appear reluctant to
go down, news is an unprofitable business as far as five
is concerned, just as much as it is for Channel 4.
Ms Robertson: It is not the most profitable
part of our programming, but you have to look at the programming
as a whole. Going back to your last questions to Channel 4—about
"Would you still be doing news in 2013 after digital switchover?"—I
would say as the director of Channel 4 that, as a multi-genre
channel, we would absolutely be doing news. It is part of the
personality and—I hate to use the word because it is very
marketing-oriented—the brand of your whole channel. Who
your newsreaders are, the face of your news, the type of news
you do, says a lot about you as a channel; so I think it would
be really unlikely that we would stop doing it I cannot talk for
our shareholders in five or six years' time, but it is a very
important part of our personality as a channel. We will continue
to do news. It is not just how much money it happens to make in
terms of the outbreak in the middle of the news; that is not the
only way you cost or value your news service.
Q126 Chairman:
Do you get the impression that that view of yours is shared by
Bertelsmann?
Ms Robertson: We have never had this discussion
with Bertelsmann, so I cannot say; but RTL and Bertelsmann are
very happy for us to—
Mr Shaw: The investment in news has actually
grown over the ten years that I have been involved with it. There
has never been downward pressure on the money we spend on news.
Unlike Channel 4, we are a private profit-making company. You
can therefore draw your own conclusions from that. I would like
more viewers and I would like it to make more money for the company,
but I realise that a lot of the benefits are not cash-based. As
Sue said, they are to do with the image of a channel.
Q127 Chairman:
You have a system of cross-subsidy, basically?
Mr Shaw: There are parts of the schedule that
do not make money and there are other parts that do.
Ms Robertson: You could talk about our children's
programmes or our arts programmes in just the same way as we are
talking about news, but all of these things together—with
our American-purchased programmes, our documentaries, features—all
go to make an overall channel. We decide where we are going to
put the advertising—more or less.
Q128 Lord King of Bridgwater:
I am not quite clear what you actually have to do with news. You
have contracted Sky to provide your news. What input does anybody
in five actually have to any news programme?
Mr Shaw: I am the Controller of News at Channel
5 and I have exactly the same relationship to the editor of five
News as Dorothy has with Jim, who is a Sky employee in the same
way as Jim is an ITN employee.
Q129 Lord King of Bridgwater:
Do you talk on a daily basis to Sky about what priority, what
order of programming, what you are going to attach importance
to? Sky say, "Look, we've got this menu today. We've got
these various stories around". Do you get involved in deciding?
Mr Shaw: No. Like Dorothy, I set strategy. I
tend to discuss programmes after they have been transmitted rather
than before. We discuss campaigns, areas that we might want to
focus on in the future weeks or months; but, in terms of day-to-day
decision-making, that is best left to the editor who controls
the programmes.
Q130 Lord King of Bridgwater:
The Sky editor?
Mr Shaw: The Sky News. The editor who works
for Sky is a Sky employee, in the same way that Jim is an ITN
employee.
Q131 Lord King of Bridgwater:
So why should I watch five News rather than just watch
Sky?
Mr Shaw: Sky is a 24-hour rolling news service;
Channel 5 News, if you have watched it, you will know is very
different from Sky. It has a very different proposition. It is
a linear programme of set points during the day. It has a particular
take. It has won awards for its distinctiveness. It is on at different
times of the day that may or may not suit you, but 5.30 suits
quite a lot of people.
Q132 Lord King of Bridgwater:
Could you describe the different take?
Mr Shaw: Yes. I think it is fresher, clearer
and more straightforward than other news programmes.
Q133 Lord King of Bridgwater:
Than Sky?
Mr Shaw: Than Sky and than any other news programme,
actually. I think that it is clearer than others. We also are
the only channel that runs what I would call these little, bite-sized
updates, which are in prime time, on the hour—one minute,
one and a half minutes' long. They are extremely popular; they
are watched by up to three million people a night. Often, if you
ask people about what is news on five, they will refer
to those updates rather than our main programmes.
Q134 Chairman:
It is because you are waiting for the next programme, is it not?
Mr Shaw: Yes, but they are still being watched
and they are still useful, in the same way that Radio 1 news programmes
are useful. They are there as a service and, when we researched
them, they are much appreciated. However, if you are talking about
the essence of five News, it is to do with its clarity,
accessibility and straightforwardness.
Q135 Lord King of Bridgwater:
Have you ever had any representations made by your owners about
the stance you have given to any particular news items?
Ms Robertson: No.
Mr Shaw: I have not.
Q136 Lord King of Bridgwater:
You are corporate affairs, are you not?
Mr Shaw: I also have not had any conversations
with Gerhard or any other shareholder about the content of the
news.
Q137 Lord King of Bridgwater:
Who negotiated the contract with Sky?
Mr Shaw: I did.
Q138 Lord King of Bridgwater:
Was it ratified by RTL?
Mr Shaw: I think that any major contract is
under the supervision of our shareholders, yes. It is something
that is worth £10 million pounds a year. They would certainly
have known about it. I think that they are very happy about—
Q139 Lord King of Bridgwater:
More than that: did they actually get involved in the negotiations?
Mr Shaw: No.
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