‘The UK Deserves Some Media Free of US Control’: Comcast’s Takeover Attempt for ITV Starts to Focus Minds

The idea of the American media conglomerate acquiring ITV has raised apprehensions about the impact on British public service broadcasting, a reality that the broadcaster's new CEO, joining from a high-ranking position at Sky, will be keenly aware of.

Sky’s advertising chief, Priya Dogra, will now be expected to lead the charge to oppose her ex-company's takeover plan to defend Channel 4.

The proposed merger of Sky and ITV’s broadcasting operation would leave Channel 4 a much smaller player in the realm of TV and digital ad sales, reigniting talk of the need to reconsider some form of tie-up with the BBC for future viability.

Primary Concern: The Future of News

However, it is the possible consequences on the future of news provision that are causing the most present anxiety for many within the television industry.

The unexpected announcement last month that Comcast, which controls assets including Universal Studios and bought Rupert Murdoch’s Sky for £30bn in 2018, is financially rational. Traditional broadcasters are facing a long-term existential threat as audiences and revenues continue to rapidly migrate to global digital players such as Meta, Google, Amazon, and Netflix.

“Comcast’s advance for ITV is causing trepidation among media watchers, with especial focus for news provision.”

However, the potential £1.6bn acquisition of ITV’s broadcasting arm and streaming service, which would end 70 years of self-rule, is full of regulatory, political, and competition concerns.

Overnight, Comcast would control Sky News and ITV News—including its sprawling regional news operation—and become the biggest shareholder in ITN, which produces news for ITV, Channel 4, and Channel 5.

While Comcast’s 40% stake in ITN would not be a dominant share—other shareholders include the owner of the Daily Mail, Thomson Reuters, and Informa—it would still be significantly influential in the news output of most of the main commercial broadcasters.

“If a deal goes through, the fate of ITN is an interesting one that will concentrate attention politically,” notes one senior TV executive. “Effectively, they will be involved in the news output of all the biggest non-BBC channels.”

Investment Promises and Regulatory Scrutiny

Comcast guaranteed to keep funding Sky News for a decade, raising its funding annually in line with inflation, as part of its 2018 takeover of Sky. As that commitment draws closer to expiring, concerns have been raised about whether the US company will continue to wholly support Sky News, which has an annual budget of £100m but is thought to make losses of as much as £80m.

It is understood that any deal to buy ITV would include assurances not to seek permission from media regulator Ofcom to alter the conditions of its public service broadcast licence, which includes obligations to national and regional news.

“There are clearly questions about plurality,” says Stewart Puvis, a former ITN chief executive. “Theoretically, Comcast could, say, merge Sky and ITV News and use its position as a 40% shareholder in ITN to gain influence... I would hope Comcast appreciate ways of solving these problems.”

An Endangered Model

British TV executives have previously highlighted the risk posed to the UK’s system of public service broadcasters (PSBs) by large parts of the industry being snapped up by US corporations.

Recently, Ofcom published a report warning that public service television, such as news provision and UK-focused content, risks becoming an “endangered species” as viewers migrate to US online platforms and streamers.

The watchdog also revealed data showing that YouTube had exceeded ITV to become the UK’s second most-watched media service, behind only the BBC, with it and Netflix now the two most popular first TV destinations among young people.

Strategic Imperatives

There are those who believe that a Sky takeover of ITV, against the context of the viewer shift to mostly US digital companies, heralds the need for closer cooperation between the UK’s biggest broadcasters.

“The UK requires and deserves its own part of mass media which isn’t US controlled,” says a second broadcasting executive. “It’s a vital strategic need. I think the government needs to work out how the boards of the PSBs have a new part to their remits that obligates them to collaborate.”

Given that advertisers follow eyeballs, a combination of Sky and ITV could create a British TV and streaming titan, with the two companies’ sales houses controlling a dominant share of total ad spend on traditional TV and broadcasters’ streaming services.

The CMA's Role

Any deal will prompt an investigation by the UK competition watchdog. Sky is hoping the regulator will expand the view of the ad market to include the impact of giants like YouTube and Facebook.

“I think it will get approved,” says Alex DeGroote, a media analyst. “Comcast will do everything it can to say it will maintain the PSB status quo... But you don’t buy to ultimately keep everything the same. ITV plus Sky would give them a hugely dominant position in the TV ad market.”

Funding Problems of Channel 4 and the BBC

Channel 4, which relies on advertising for the vast majority of its income, now faces a diminished BBC as a potential partner and a formidable commercial threat from a combined Sky-ITV.

“We may at some point end up in that situation because of the deep cumulative cuts to the BBC’s funding and because Channel 4, too, has a structural funding problem,” says Patrick Barwise, an emeritus professor at London Business School. “Channel 4 has repeatedly defied expectations, but that is just postponing the problem. It’s now beginning to reach its limits.”

The evolving situation highlights a wider question for British media: how to preserve a independent voice and a robust public service ecosystem in an increasingly globalised and digitally dominated landscape.