What the story of ITV tells us about telly

Is ITV on the up, transforming itself into a tough, multi-platform market-leader? Or is it on the slide, dying a slow, lingering, undignified death? The answer largely depends on what you think ITV is for.

This week, for instance, ITV’s chief executive, Charles Allen, announced that profits for 2005 were up 37% to £425m. Shareholders saw their final dividends boosted, while the company’s pension deficit has been halved. On any objective analysis this was a good, solid performance, reflected by ITV’s share-price mini-spike.

Now let’s have a look at the subjective side. And you don’t get much more subjective than Jimmy McGovern, creator-writer of one of ITV’s drama gems, Cracker: "If I see anything on at ITV at 9pm, I don't turn on because I know it is going to be crap. It wouldn't be on ITV at that time if it was any good. I might watch something at 11pm but at that time it's crap and every writer I know agrees."

Of course there is no dichotomy between a financially healthy ITV, and a culturally parlous ITV: both reflect the reality. A glance at Trinity Mirror, owner of the Daily Mirror, reveals a symmetrical picture. Its chairman, Sir Victor Blank, reported profits this year of £221m, achieved principally by slashing costs, under-investing in its core journalism.

The legendary TV producer and executive, Sir Jeremy Isaacs, has just published his memoirs, Look Me In The Eye, which was reviewed by Tim Gardam in yesterday’s Guardian. It speaks of a wholly different telly age:

As Thames's director of programmes, [Isaacs’] achievement - Bill Brand, Rock Follies, Rumpole, Edward and Mrs Simpson, The Sweeney and The Naked Civil Servant - outshone the BBC's programmes of the same era. … In 1968, he was asked [by the BBC] if he would produce a history of the second world war. Isaacs was enthused, only to find out that, behind his back, the BBC had made others the same offer, and then decided it did not have the money. So he took the idea to his bosses at Thames and went on to make a history series [The World at War] that the BBC has never emulated.

Telly has changed, and it’s pointless to lament the passing of this ‘golden age’. (An age which also produced, lest we forget, The Black & White Minstrels Show and Mind Your Language.) But Messrs McGovern’s, Isaacs’ and Gardam’s essential point remains: would any bright young thing who feels they have something important to say now dream of making programmes for ITV? To ask the question is to answer it.

For those of us who think television can and should matter – that its mass potentiality to challenge and entertain the public is crucial to a sentient, liberal democracy – the decline of ITV into a pile ‘em high, sell ‘em low blob of undistinguished, indistinguishable pap is a deeply sad one. And it is a vital lesson to successful brands everywhere – from Marks & Spencer to Oxford University – of the importance of constant renewal if past success is to be sustained.

It is also crucial that policy-makers grasp the market changes which are transforming television, and, by extension, our wider culture. ITV’s ad revenues have fallen 10% in the first quarter of 2006. Between 2000 and 2005, ITV’s audience share slumped from 29% to 21%; its advertising revenues from £2bn to £1.5bn. This is an inevitable consequence of the growth of multi-channel TV, and the explosion in alternative entertainment portals (whether the Internet or games consoles). ITV will simply not have the cash now, or in the future, to invest in good-quality programmes. It will never again commission a documentary as ambitious as The World at War.

Channel 4, Isaacs’ brilliant creation, finds itself in many ways in a similar situation to ITV. The decline of ad revenues has increased its reliance on US imports and domestic schlock-umentaries. However, 25 years’ diligent branding and canny positioning has left it in a much stronger condition than ITV, having captured the brand loyalty of the cash-rich, upwardly mobile, consumer-intelligentsia demographic.

Which leaves us with the BBC as monopoly-supplier of public service broadcasting. Its programming budgets are protected from market vicissitudes and commercial competition by the BBC licence fee. For those who watch the BBC the licence fee is a fantastic deal – indeed, it is why the liberal, middle-classes love it. For those who do not want to watch the BBC, the licence fee is a regressive poll tax.

The history of cultural decline at ITV is a portent of the direction in which television is moving. For some, this decline is the very reason why the BBC licence fee must remain enshrined as the guarantor of quality telly. What worries me is the way the licence fee now so skews the market that the BBC has established a state-sponsored monopoly of what constitutes public service broadcasting. Its financial muscle threatens to strangle at birth any potential rival to its superiority.

There is no reason why television should be regarded as a natural monopoly. It is the licence fee which is making it so, and the viewing public are the poorer for it.