Organization would absorb Channel 4

LONDON — U.K. media regulator Ofcom has called for the setting up of a new U.K. public service broadcaster with Channel 4 “at its heart.”

In the final recommendations of its second review of public service broadcasting in Blighty, “Putting Viewers First,” the watchdog warns that unless radical action is taken Channel 4 faces “managed decline” due to increased competition and grim economic prospects.

Ruling out a public subsidy for the cash-strapped web — including a share of the BBC’s license fee — Ofcom’s preference is to “create a strong, alternative public service voice to the BBC with Channel 4 at its heart, preferably through partnerships, joint ventures or even mergers.”

This is most likely to involve Channel 4 either merging with Five, owned by pan-European giant RTL, or a collaboration with BBC Worldwide, the corp.’s commercial arm.

Speaking at a press conference Wednesday, the regulator’s CEO Ed Richards refused to indicate which of these two options he prefers.

However, Richards warned that a merger between Channel 4 and Five would be “challenging and not without risks.”

Ofcom’s report counsels caution on a tie-up between the two broadcasters because of their very different and distinct cultures.

“A key concern is that the combination of a public not-for-profit organization with public purposes, and a private profit maximizing one with commercial objectives is highly complex,” said the regulator.

It added: “A fundamental tension may always remain, which would be likely to complicate the allocation of assets and investment to public service content, particularly at points where the organization faced financial pressure.”

Ofcom also announced that ITV, the U.K.’s biggest private terrestrial broadcaster, and Five would be largely freed of their public service commitments.

ITV would still have to invest heavily in U.K. programs and provide international and national news coverage, but Five would be allowed to spend less coin on British shows.

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