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The idea of Comcast taking over ITV has raised concerns about the impact on British public service broadcasting, a reality that Channel 4’s new chief executive, who previously held a senior post at Sky, will be keenly aware of.

Sky’s advertising chief, Priya Dogra, will now be tasked to take a leading role to block her ex-company's acquisition bid to safeguard Channel 4.

The potential union of Sky and ITV’s broadcasting operation would leave Channel 4 a significantly weaker competitor in the realm of TV and digital ad sales, reviving talk of the need to revisit some form of alliance with the BBC for future viability.

Primary Concern: The Future of News

However, it is the potential ramifications 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 owns assets including Universal Studios and acquired Rupert Murdoch’s Sky for £30bn in 2018, is a logical business move. Traditional broadcasters are facing a profound survival challenge as audiences and revenues continue to rapidly migrate to global digital players such as Meta, Google, Amazon, and Netflix.

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

However, the potential £1.6bn purchase of ITV’s television business and streaming service, which would end 70 years of independence, is laden with regulatory, political, and competition problems.

Immediately, Comcast would control Sky News and ITV News—including its far-reaching 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 deeply engaged in the news output of most of the main commercial broadcasters.

“If a deal is completed, the fate of ITN is an interesting one that will become a priority 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 promised to keep funding Sky News for a decade, upping its funding annually in line with inflation, as part of its 2018 takeover of Sky. As that assurance draws closer to concluding, concerns have been raised about whether the US company will continue to fully fund Sky News, which has an annual budget of £100m but is thought to operate at a deficit of as much as £80m.

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

“There are certainly questions about media diversity,” 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 assert control... I would hope Comcast appreciate ways of solving these problems.”

Pressure on Public Service

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

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

The watchdog also revealed data showing that YouTube had overtaken 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 backdrop of the viewer shift to mostly US digital companies, heralds the need for closer collaboration between the UK’s biggest broadcasters.

“The UK must have its own part of mass media which isn’t US controlled,” says a second broadcasting executive. “It’s a key national priority. I think the government needs to work out how the boards of the PSBs have a new part to their remits that compels them to collaborate.”

Given that advertisers follow eyeballs, a combination of Sky and ITV could create a British TV and streaming powerhouse, 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 trigger an investigation by the UK competition watchdog. Sky is hoping the regulator will broaden the definition 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.”

Structural Challenges of Channel 4 and the BBC

Channel 4, which relies on advertising for the vast majority of its income, now faces a weakened 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 core budgetary challenge,” says Patrick Barwise, an emeritus professor at London Business School. “Channel 4 has repeatedly outperformed forecasts, but that is just delaying the inevitable. It’s now beginning to run out of road.”

The continuing debate underscores a larger conundrum for British media: how to safeguard a distinctive voice and a robust public service ecosystem in an progressively globalised and digitally dominated landscape.