Interview: Charles Allen, ITV (Evening Standard)
By David Rowan
Charles Allen is ready for the next stage of his ITV revolution. Having merged the regional broadcasters, dumped a few regulatory burdens, and latterly seen a few senior colleagues walk the plank, the network's 48-yearold chief executive is finally ready to address his own future. So, next week, he is finally moving from the South Bank to his Gray's Inn Road commissioning centre.
Allen, one of television's most powerful men - and rewarded as such, with a package approaching £1.9 million - has had little time lately for office housekeeping. With ITV1 ratings under attack, and ad revenues falling, he has faced relentless pressure to reveal an effective strategy. No matter that last month he could announce a 60 per cent rise in profits: Allen was being called a money man with no creative vision.
Now he is ready to respond. On the 14th floor of the former London Weekend tower, looking down across the London Eye, Allen is explaining the "brave, creative decisions" that he says will serve ITV well into its second 50 years. Yes, ITV1 will play a diminishing role in the network's future. But by taking shows onto greater numbers of digital platforms, from new Freeview channels to mobile phones, overall, he insists, we will be watching more ITV, not less.
"The focus is one of growth," he says. "When we merged, 95 per cent of our profits came from ITV1, but in our most recent results 18 months later, already 30 per cent of profits come from elsewhere. You've seen the success of ITV2, now beating Sky One; you've seen ITV3 already in the top three in multichannel homes. Now we're about to launch ITV4, aimed at the 16- to 35-year-old male. It's all about giving the viewer a range of offers."
Allen, who started as a British Steel in-house accountant before working his way up through the Granada Group into its television arm, remains at heart a numbers man. His answers are littered with statistics and talk of "value propositions" and "financial impacts". He is quick-minded and articulate, and clued-up enough to bat back questions about prospective takeover bids ("people are just a bit bored of that") or Greg Dyke's regular scathing criticisms of him ("he can write whatever he likes"). Only when Channel 4 is mentioned does he go for the jugular - questioning its supposed creative vision ("most of its ratings come from Hollyoaks, Countdown and Richard & Judy, so look beyond the image") as well as its public-service commitment ("Channel 4 has never done anything material in the regions").
He is not, he insists, the ruthless cost-cutter that critics sometimes claim. "Charles Allen is actually the person who's led the consolidation of ITV, and growth is not about cost-cutting," he says. "Yes, I can cut costs, but that's the easy bit. It's about creating growth, which is why we've launched ITV Local and ITV Mobile. We'll still deliver the things people know and love, like Coronation Street, but it's now about seeing you as more as a customer than a passive viewer, giving you what you want, when you want it."
For now, though, ITV needs urgently to boost ratings after a tough summer. ITV1's audience share was down 6.3 per cent in the year to September, far more among 16- to 34-year-olds, not by the poor performances of critically mauled series such as Celebrity Wrestling and Celebrity Love Island. But Allen says the real problem was the lack of a major sporting event.
"Celebrity Love Island delivered what it set out to do, taking 20 per cent of Big Brother's share," he says. "But we're so high-profile that if you encourage people to take risks and they get it wrong, it gets picked up." Does that mean Love Island is coming back? "It may do," he says. "That's for the company's creative leadership."
Simon Shaps, former head of production at Granada and the man responsible for the show, has been put in charge of programming, above the head of the ITV1 controller, Nigel Pickard. Insiders have suggested that Pickard is in an untenable position. "Why?" Allen responds. "Simon is basically head of channels, Nigel is still controller of ITV1. We've made it clear that Nigel is happy working with Simon."
Earlier this week, Andy Duncan, Channel 4's chief executive, accused Allen of wheedling his way out of Ofcom commitments to regulate ITV's advertising rates, a condition of the Carlton-Granada merger 20 months ago. Duncan said ITV was playing the " bullyboy", using its commercial might to backtrack on regulatory pledges, just as it had done previously in dumping News At Ten, cutting regional and religious programming, and demanding (and getting) its licence payments slashed.
Nonsense, Allen responds: the ground rules have simply shifted. The Ofcom advertising agreement was based on 2002 assumptions about multichannel growth, which proved low. "That agreement was not put in place to penalise us for the growth in multichannel," Allen says. "It's not like we're not delivering our part of the bargain: analogue performance is the same as last year. But it's only really in the last 18 months that you've seen Freeview's phenomenal growth."
As for the £135 million cut in its licence fee, that was simply the reasonable return of money "grossly overpaid". "We still pay substantially more than we should," Allen adds. He also insists that ITV is defiantly not neglecting its publicservice commitments - although he defines the term loosely: "I'm proud of the fact that we spend £1 billion on original programming," he says. "That's fantastic public service, giving viewers the best programming for nothing."
News and current affairs will remain at ITV1's core, he insists. There are "no plans" to move the main evening bulletin from 10.30pm. Nor, despite a "misunderstanding" by Stewart Purvis, former ITN chief executive, are there any plans to cut news budgets. "High-quality news needs significant investment," he says. "We had 40 people covering the tsunami, more people covering the dreadful disasters in London than any other news service in the world, and we're first at the scene of all the major events. That's putting our news proposition at the heart of public-service broadcasting."
His ambition to buy the ITN shares that ITV does not own, takhelpeding the news provider fully inhouse, is causing concern at Channel 4. Its ITN-provided service is up for renewal. "I don't see why it should be concerned," Allen says. "We're keen to make programming for other people, just as I have Granada making programmes for the BBC. What it does is give Channel 4 access to £100 million worth of newsgathering at a reasonable price, something they'd never get from a standalone offer."
As for the future, Allen wants ITV content on any digital device where it can earn a commercial return. "There are attractive things you can do with games, gaming, dating, shopping. With ITV Local, we'll use our fantastic local content to tap into the £2 billion classified market. On your mobile phone, what content can we make last two bus stops? Maybe the five funniest X Factor contestants? The opportunities are tremendously exciting."
And the programmes - which, after all, are what ITV has until now been about? "There will be more live television. It has an edge, which audiences increasingly like - they want to see the odd mistake. The days of Seventies canned laughter are over. And people are still fascinated with celebrities, though they want them quite real, showing vulnerability."
ITV's only certainty, he says, will be a relentless need to evolve in response to the new ways "customers" will consume "content". "I've run hotel businesses, restaurants, and you know that in 10 years' time people will still want to sleep and eat there. The exciting thing about this medium is it's changing so fast. My job is to create as many options as possible, even though none of us knows how it will pan out."
Shareholders generally expect more certainty from a CEO. But Allen, one of television's great survivors, is not ready to give in yet.
(Evening Standard, October 26 2005)
. . . AND READ MORE MEDIA INTERVIEWS HERE . . .
Charles Allen is ready for the next stage of his ITV revolution. Having merged the regional broadcasters, dumped a few regulatory burdens, and latterly seen a few senior colleagues walk the plank, the network's 48-yearold chief executive is finally ready to address his own future. So, next week, he is finally moving from the South Bank to his Gray's Inn Road commissioning centre.
Allen, one of television's most powerful men - and rewarded as such, with a package approaching £1.9 million - has had little time lately for office housekeeping. With ITV1 ratings under attack, and ad revenues falling, he has faced relentless pressure to reveal an effective strategy. No matter that last month he could announce a 60 per cent rise in profits: Allen was being called a money man with no creative vision.
Now he is ready to respond. On the 14th floor of the former London Weekend tower, looking down across the London Eye, Allen is explaining the "brave, creative decisions" that he says will serve ITV well into its second 50 years. Yes, ITV1 will play a diminishing role in the network's future. But by taking shows onto greater numbers of digital platforms, from new Freeview channels to mobile phones, overall, he insists, we will be watching more ITV, not less.
"The focus is one of growth," he says. "When we merged, 95 per cent of our profits came from ITV1, but in our most recent results 18 months later, already 30 per cent of profits come from elsewhere. You've seen the success of ITV2, now beating Sky One; you've seen ITV3 already in the top three in multichannel homes. Now we're about to launch ITV4, aimed at the 16- to 35-year-old male. It's all about giving the viewer a range of offers."
Allen, who started as a British Steel in-house accountant before working his way up through the Granada Group into its television arm, remains at heart a numbers man. His answers are littered with statistics and talk of "value propositions" and "financial impacts". He is quick-minded and articulate, and clued-up enough to bat back questions about prospective takeover bids ("people are just a bit bored of that") or Greg Dyke's regular scathing criticisms of him ("he can write whatever he likes"). Only when Channel 4 is mentioned does he go for the jugular - questioning its supposed creative vision ("most of its ratings come from Hollyoaks, Countdown and Richard & Judy, so look beyond the image") as well as its public-service commitment ("Channel 4 has never done anything material in the regions").
He is not, he insists, the ruthless cost-cutter that critics sometimes claim. "Charles Allen is actually the person who's led the consolidation of ITV, and growth is not about cost-cutting," he says. "Yes, I can cut costs, but that's the easy bit. It's about creating growth, which is why we've launched ITV Local and ITV Mobile. We'll still deliver the things people know and love, like Coronation Street, but it's now about seeing you as more as a customer than a passive viewer, giving you what you want, when you want it."
For now, though, ITV needs urgently to boost ratings after a tough summer. ITV1's audience share was down 6.3 per cent in the year to September, far more among 16- to 34-year-olds, not by the poor performances of critically mauled series such as Celebrity Wrestling and Celebrity Love Island. But Allen says the real problem was the lack of a major sporting event.
"Celebrity Love Island delivered what it set out to do, taking 20 per cent of Big Brother's share," he says. "But we're so high-profile that if you encourage people to take risks and they get it wrong, it gets picked up." Does that mean Love Island is coming back? "It may do," he says. "That's for the company's creative leadership."
Simon Shaps, former head of production at Granada and the man responsible for the show, has been put in charge of programming, above the head of the ITV1 controller, Nigel Pickard. Insiders have suggested that Pickard is in an untenable position. "Why?" Allen responds. "Simon is basically head of channels, Nigel is still controller of ITV1. We've made it clear that Nigel is happy working with Simon."
Earlier this week, Andy Duncan, Channel 4's chief executive, accused Allen of wheedling his way out of Ofcom commitments to regulate ITV's advertising rates, a condition of the Carlton-Granada merger 20 months ago. Duncan said ITV was playing the " bullyboy", using its commercial might to backtrack on regulatory pledges, just as it had done previously in dumping News At Ten, cutting regional and religious programming, and demanding (and getting) its licence payments slashed.
Nonsense, Allen responds: the ground rules have simply shifted. The Ofcom advertising agreement was based on 2002 assumptions about multichannel growth, which proved low. "That agreement was not put in place to penalise us for the growth in multichannel," Allen says. "It's not like we're not delivering our part of the bargain: analogue performance is the same as last year. But it's only really in the last 18 months that you've seen Freeview's phenomenal growth."
As for the £135 million cut in its licence fee, that was simply the reasonable return of money "grossly overpaid". "We still pay substantially more than we should," Allen adds. He also insists that ITV is defiantly not neglecting its publicservice commitments - although he defines the term loosely: "I'm proud of the fact that we spend £1 billion on original programming," he says. "That's fantastic public service, giving viewers the best programming for nothing."
News and current affairs will remain at ITV1's core, he insists. There are "no plans" to move the main evening bulletin from 10.30pm. Nor, despite a "misunderstanding" by Stewart Purvis, former ITN chief executive, are there any plans to cut news budgets. "High-quality news needs significant investment," he says. "We had 40 people covering the tsunami, more people covering the dreadful disasters in London than any other news service in the world, and we're first at the scene of all the major events. That's putting our news proposition at the heart of public-service broadcasting."
His ambition to buy the ITN shares that ITV does not own, takhelpeding the news provider fully inhouse, is causing concern at Channel 4. Its ITN-provided service is up for renewal. "I don't see why it should be concerned," Allen says. "We're keen to make programming for other people, just as I have Granada making programmes for the BBC. What it does is give Channel 4 access to £100 million worth of newsgathering at a reasonable price, something they'd never get from a standalone offer."
As for the future, Allen wants ITV content on any digital device where it can earn a commercial return. "There are attractive things you can do with games, gaming, dating, shopping. With ITV Local, we'll use our fantastic local content to tap into the £2 billion classified market. On your mobile phone, what content can we make last two bus stops? Maybe the five funniest X Factor contestants? The opportunities are tremendously exciting."
And the programmes - which, after all, are what ITV has until now been about? "There will be more live television. It has an edge, which audiences increasingly like - they want to see the odd mistake. The days of Seventies canned laughter are over. And people are still fascinated with celebrities, though they want them quite real, showing vulnerability."
ITV's only certainty, he says, will be a relentless need to evolve in response to the new ways "customers" will consume "content". "I've run hotel businesses, restaurants, and you know that in 10 years' time people will still want to sleep and eat there. The exciting thing about this medium is it's changing so fast. My job is to create as many options as possible, even though none of us knows how it will pan out."
Shareholders generally expect more certainty from a CEO. But Allen, one of television's great survivors, is not ready to give in yet.
(Evening Standard, October 26 2005)
. . . AND READ MORE MEDIA INTERVIEWS HERE . . .
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