Channel Four Television Corporation Report and Financial Statements 2010 Channel Four Television Corporation Report and Financial Statements 2010

Home , Channel 4 Radio, Discovery Networks UK, FilmFlex, Fonejacker, Genius of Britain, Lauren Laverne

Looking back Looking forward

Incorporating the Statement of Media Content Policy

Presented to Parliament pursuant to Paragraph 13(1) of Schedule 3 to the Broadcasting Act 1990 Key Table of Contents

Invest in high-quality content Throughout this report readers will see frequent references Chairman’s Statement 4–5 Financial Report and Statements to Channel 4’s remit, as set out in the Communications Act 2003 Innovate and updated and extended in the Digital Economy Act 2010. Chief Executive’s Statement 6–7 Building on our original remit to be innovative, experimental and Cultural diversity distinctive, the new remit recognises the role Channel 4 should Report of the members 92 play in the digital world, not just on the main channel but across Distinctive our portfolio of services. It also introduces four purposes Statement of Media Content Policy Report of the auditors 101 – to nurture talent, stimulate debate, promote alternative Educational views and inspire change. Consolidated income statement 104 Overview 8–15 Nurture talent With the introduction of the new requirement to publish a Statement of changes in equity 105 Statement of Media Content Policy in the Digital Economy Act, Doing things the Channel 4 way 16–25 Stimulate debate this report is structured around the key genres through which Balance sheets 106 Channel 4 delivers its remit, with a view to providing a better Film & Drama 26–33 Alternative views insight into how investment and commissioning decisions Cashflow statements 107 are made. Factual 34–41 Inspire change Significant accounting policies 108 The component parts of the updated remit are summarised Spotlight > E4 42–43 Digital in the list to the left. Throughout the report, a series of ‘icons’ Notes to the financial statements 114 sit alongside the case studies and public value measures Comedy & Entertainment 44–51 Partnership to highlight the parts of the remit that are being addressed. Corporate governance 141 News & Current Affairs 52–59 A description of the remit, as well as the process for selecting Members 148 the public value measures, can be found in the methodology Education & Older Children 60–65 document that accompanies this report Report on members’ remuneration 150 (channel4.com/annualreport). Spotlight > International 66–67 Programmes and the licence 154 Engaging the audience 68–75 Historical record 156 Awards 76–79

Renewing our purpose 82–83 Investing in creativity 84–85 Creative ambitions 86–89 Assurance Report 90

The text of this document (this excludes, where present, logos) may be reproduced free of charge in any format or medium providing that it is reproduced accurately and not in a misleading context. This publication is printed on paper which is produced using 100% PEFC (Programme for the Endorsement of Forest The material must be acknowledged as Channel Four Television Certification) certified pulp. This is virgin fibre from managed Corporation copyright and the document title specified. Where forests with a verifiable chain of custody which extends right third party material has been identified, permission from the back to the forest. www.pefc.org respective copyright holder must be sought. SECTIONCHAIRMAN’S TITLE STATEMENT 55 There were a number of Board changesBoard of number a Therewere Channel 4 steer to do to much There is the House annual our before appearance at Culture,Sportand Media Commons of Committee. Select thank liketo Karren would I during the year. their contribution for AndyMollett and Brady our welcome years,to and of number a over directors, Marknon-executive Price, new four AlicjiaLesniak, Burchand Monica RichardRivers. that throughconfident feel I this – phase next thepeople have the organisationacross we withskillssucceed. and the vision to The first Statement of Media Content Content Media of Thefirst Statement we are accountable for our performance. our for are accountable we in the Act theinclusion welcomed We arrangements,enhanced accountability of an annual publish require to which us Policy Content Media of Statement fulfilmentdemonstrating remit of the future our setting and strategy. out the Public on builds here published Policy our at published have Report Impact that we years.Withintwo the last initiativeown a for made have we structurehow show that aims to in linewith decisions our investment content objective of set detailed a incorporates it remit, performance. our This assess to measures public research on audience extensive includes ChannelThroughout the report 4. attitudesto the of assessment robust a provide aim to we with together had, has content our impact particular how of activities indications and contains It the remit. programmesmet have the strategy for overarching our content thehas Board which year, following discussed also have We scrutinisedrigorously. consult to duty new our under with it Ofcom also We preparation. with themin the report’s performancescrutiny our forward to of look David Abraham’s arrival Abraham’s Executive Chief David as some saw the year half of Thesecond remit Channel 4’s of update Parliament’s service mission public our deliver Aswe response to us around the key aspects of our aspectsof thearound key us to response measures range a although across remit, of small a narrowing saw over we inlead our speeds renewal As creative broadcasters. other diversityseeing greater forward to look I up, This output. our experimentation and across increasing reputation translate our into should thein measures across 2011 withaudiences beyond. and in positioning phase thein marked next May structurallyand Channelcreatively 4 a for thank liketo Anne would I world. converged as did she job the tremendous for Bulford ActingExecutive. Chief TV of encouraging the resilience signs of recover advertising. Asbegan the market to in content. investment restore to able were we the structural changes takingHowever, place continue inindustry our must thatmean we continued have We commercially. evolve to indigital our invest onlineand activities,to ventures of the development support to and YouView. as such an importantwas Act in the Digital Economy in role ongoing Channel 4’s of endorsement cultural, life. socialeconomic theand UK’s recognises the varietyIt in which ways of longer no – value public Channeldelivers 4 our across also single channel,but a as solely digitalchannels, online activities inand British purposes four film. Act also incorporates The nurture provide the remit:to to into talent, and debate stimulate views, to alternative inspire change. to vital is that it ways, complex inmore ’s wry take ’s Channel 4 is at its 4 is at Channel strongest when at when strongest its most independent its most

Alternative Election Night Election Alternative

Our not-for-profit status ourguarantees Ournot-for-profit was I InGeneralyear, a Election largely have that we Our research shows independence both from shareholders and bothfrom shareholders independence fulfil to are able that we so Government distinctive, be challenging to remit our Channel is 4 believe I provocative. and independent. most its at strongestwhen its at delivery on concentrate to is Ourapproach ability withinour of the best to remit our of direct thanrathermeans, seek our to subsidy. public particularlywith distinctive our pleased take from thecurrent televised first on events, live Chancellors, the would-be between debate the to audiences amongst maintainedreputation our with remit, for our strongyear a met and dramacomedy, documentary, new and with realsuccesses online some as well as inand reachingaudiences. younger content to continue that we see encouraging is to It thethat audience’s measures assess on lead One of the attractions to the role of Chairman of thetheattractions role of to One commercial of blend unique Channelits is 4 of service This objectives. public and discipline as investing much on as focused us keeps fulfil service to public our in content possible many this enabled inand 2010 mission, successes. creative Channeland night Election 4’s itself on characteristicallyin-depth coverage. news

the remit the LordBurns, Chairman Delivering

SECTIONCHAIRMAN’S TITLE STATEMENT 44 SECTIONCHIEF EXECUTIVE’S TITLE STATEMENT 77 Nurturing been always has talent new put have we firstChannelat 4, Inyear my where year a be to promises 2011 Thissingle the biggest projects of will one be theour heart historyinto of goes our and perspectives, alternative provide to mission communitiesdiverse bring and showcase lasting change. about continued have hallmark a ChannelWe 4. of across withcompanies of hundreds work to theUK runprogrammesand thatnumerous experienceinindustries. theoffer creative the for us prepare to foundations inplace future. are testament Our on-screen successes work we people talented of the thousands to would I and sector within the independent contributed thank has liketo who everyone thank liketo also would I output. our to shown theadvertising have community who enduring in the confidence importance Channel And finally, 4. of and television of and all specialthe thank dedicated a to you staff theorganisation. talented across risk-taking creativity, spirit of Channel4’s will innovation and flourish. One of my priorities was to put in place a in place put prioritiesto was my of One the to Hunt Jay appoint to delighted was I thrilled were the start At we the year to of British film production by increasing Film4’s Britishby Film4’s increasing film production years five millionfor year a £15 to budget from2011. reducing team, management executive leaner by group management thesenior thesize of reorganised also to team the sales 25%.We streamlined clients. more to a offer provide look I and Officer, Creative Chief of role new with through her workingclosely forwardto like also would I beyond. and renewal creative thank to KevinJulian and for Bellamy Lygo theyears. Bringing over their vision creative onlineand commissioning television together the first Jay will for aligntime ourunder new create and objectives content overall This opportunitieswillsuppliers. our build for from digitalmany our in on 2010, innovations more that engages audiences onlinecontent directlythe growth onlineto our offer of work to continued also have We through4oD. and YouView withpartners our develop to available widely is content ensure our to various platforms. across consumers to Games.Paralympic winthe rightsthe 2012 to Such scope for experimentation inevitably for scope Such our of the talent to tribute a was It the to adapt While willto we continue means not everything meansnot But ambitions. our met important is that havingfail it to the freedom informsWhile future our success. our creative strongly with resonate to continues output the space provides renewal creative audiences, and innovation for enhance reputation our to inspire to more do to hope risk-taking.We themwith provide theand tools audiences theirchanges make lives; to with to and the diversity creative department new a of creation diverseamongst reputation our see to hope we strengthen. groups audience commissioningtheandteams producers the things withsee right to got work we we recognisedin myriad including awards, Channelthebeing Channelnamed4 of the Edinburgh at TV and Festival Year the Year Channel E4beingof awarded Awards. the Broadcast at excitingopportunities the digital of world, remains an powerfulextremely television sharethe portfolioacross Audience medium. ourflat, with digitalremained has broadly channelsincreasing their share.Our growth market modest in 2010 predictionsof significant more liftmuch a translatedin into theTV advertising Overall market. revenues million. to Due £935.2 to increased12.6% able not upturn were theinlate we the market leading content, in thisnew invest wholly to £49.5 an increaseinoperating of cashour to million.invest These reserves to canused be in objectives strategic key and incontent more invest to able were futureyears.We was I and than however, planned, incontent in role particularly our reinforce to delighted Unreported

This is England ThisEngland is and Big Brother Big by transition by ; drama ; that . Many ideas that Many ideas . ; and comedy ranging comedy and ; Dispatches OneBorn Every Minute characterised 2010 was TheInbetweeners

Any Human Heart Human Any ; documentaries that held a mirror a documentaries ; that held

to to 2010 was a year of transition: of year looking a was 2010 that has the show to farewell fond a said We My Big Fat Gypsy Wedding Fat Big My from the acerbic edge of Frankie Boyle to the to Frankie of Boyle edge fromthe acerbic anticsof have been in development behind the scenes behind the scenes in development been have will inthescreen 2011. reach during2010 conveyed human stories – from – human stories conveyed ’86 and other long-runninghas other and an end to shows experiment innovate. and to space up opened outstandingmany therethe were year Across best:fearless its Channel at 4 of examples currentaffairs across When I joined Channel 4 I did so with a great great a with so did I 4 Channel joined I When are we role special the for responsibility of sense source vital a remains 4 Channel play. to here that place a distinctive; and alternative the of debate provokes us, around world the reflects enormous an is It difference. a makes and into organisation the leading be to privilege renewal. and change of phase next its prepare to history, unique Channel 4’s at back the challenges immenseand for ourselves put have opportunitiesWe ahead. that lie a set team, management new a inplace significantin renewal train, of creative period convergence. for the business readied and for schedule theChannel heart 4’s at of been bring to years.The decision 11 David Abraham, David CEO Preparing for Preparingfor creative renewal creative up to society, from society, to up World to

SECTIONCHIEF EXECUTIVE’S TITLE STATEMENT 66 generate in the market place. Channel 4’s Investment in content primary form of income remains advertising, driven primarily by our TV channels and Expenditure across the Channel 4 increasingly from our online activities. With £ m network on programming and digital 578 content in 2010, % of total an advertising market that is highly responsive spent on content across all services to fluctuations in the wider economy, as well £m Channel 4’s model requires on Channel 4 475 (main channel) as long commissioning lead times, setting last a content budget is no easy feat. It demands 5% year Digital 91 16 a distinctive approach that that we take market forecasts into account 82 channels alongside our overall content objectives.

O 2 Digital media 12 E L T I T N O I T C E S O

VI W IE RV E V In order to achieve the greatest impact, W IE RV E V (excluding maximises public value within the scale of our investment in different services main channel) must reflect their reach. For this reason,

NVESTI N CREA Y T I V I AT E R C IN G IN T S E V IN > the majority of our investment remains Source: Channel 4 Y T I V I AT E R C IN G IN T S E V IN > our commercial means on the main channel, where audiences are significantly larger than for any other service. Expenditure on originated content At the same time, in line with our enhanced remit in the Digital Economy Act, levels of Total expenditure across the Channel 4

investment in new content across digital £362m network on originated content, £m spent on originated Total (£m) channels and online are increasing. content across 2010 322.6 39.0 361.6 How Channel 4’s all services 2009 341.0 32.0 373.0 Investing cross-subsidy model works Total content budget on Channel 4 (main channel) Digital TV and online last Channel 4 spent a total of £578 million on 3% year in creativity content in 2010 across the main channel, Digital TV and online expenditure on originated content, £m

£ digital TV channels and digital media. Despite High public Total (£m) unpromising market conditions at the start 2010 27.0 12.0 39.0 High public impact, impact, high 2009 23.7 8.2 32.0 low commercial commercial of the year, this was 5% more than was spent

PublicImpact return return Channel 4 is unique. Publicly owned but in 2009, and substantially higher than initial Digital TV channels Digital media (aspiration) commercially funded, our main priority is forecasts. This boost in our content spend was (excl. main channel) to fulfil our remit while funding our activities a consequence of an upturn in the advertising Source: Channel 4 £ independently in the marketplace. This is Rounding differences may occur. See methodology market in the second half of the year. document for more details an empowering model. It provides us with freedom from both Government and shareholder influence, enabling us to focus Low public impact, Low public impact, Any Human Heart our energy and revenues on delivering our low commercial high commercial return (retired) return public purposes. Our status requires a distinctive approach that maximises public value within our commercial means. In practice, this means a cross-subsidy model between different kinds Commercial Return of content (see graph). Put simply, the advertising income from some of our activities Creative Economy Impact generates enough of a profit to support content that is more risky or less commercially focused. While our aspiration must be to find In addition to the public value delivered directly ideas that achieve high levels of both public to audiences, Channel 4’s considerable and commercial value, our model enables us investment in television and digital media means to continue providing challenging or specialist we play a vital role in supporting the UK’s programming which is not commercially creative industries. Oxford Economics estimates self-sustaining. Content that no longer delivers that Channel 4 contributed £1.1 billion to UK GDP sufficient commercial or public value in 2010 (vs £1.0 billion in 2009) and supported is retired. 28,000 jobs (vs 27,000 in 2009) through its own Our reliance on commercial funding means activities, procurement from its supply chain that the amount we can invest in content and increased consumer spending through depends directly on the revenues we can the payment of wages. 8 9 Of this total investment, £566 million Volume of first-run originations turn-around programmes, such as the live Programming mix on the main channel was on television programming across all our shows Million Pound Drop and One Born At channels, including originated and acquired Average daily hours of first-run originations Christmas, a disproportionate amount of the Output mix on Channel 4 – percentage of hrs across the TV channel portfolio overall increase in the content budget was spent % output on the main channel accounted for content. A further £12 million was invested 7.9 70 by originations and first-run programmes of first-run 0.5 Total (hrs) on acquisitions (originally planned for 2011). of the main channel in digital media – up 46% on 2009. This originations every 2010 7.4 0.8 2.2 11.0 peak-time schedule Peak (6–10.30pm) day on average This provides us with greater commissioning devoted to first-run was largely driven by increased investment 2009 7.2 0.8 0.8 2.0 10.8 2010 70 7 11 12 across the TV flexibility in 2011, allowing us to maximise our originations in cross-platform content, increasing audience channel portfolio Channel 4 Channel 4 – 2009 68 10 9 13 (excluding (excl. BB streaming) Big Brother s treaming commitment to original content as we undergo on engagement with our programming. last All day Big Brother-related Digital channels Digital channels – This is in line with an overall rise in live streaming) creative renewal in earnest. 2pts year 2010 34 24 15 27 (excl. BB streaming) Big Brother streaming We were able to increase the hours of first- 2009 34 27 12 28 the proportion of our investment in digital on Source: Channel 4 O O

VI W IE RV E V services. 18% of our total content spend last run originations on the main channel, as well Originations Acquisitions W IE RV E V 2% year – ﬁrst run – ﬁrst run was on digital channels and online content, as growing the proportion of first-run Originations Acquisitions – repeat – repeat compared to 15% in 2009. £91 million was programming in peak-time on the main

NVESTI N CREA Y T I V I AT E R C IN G IN T S E V IN > Investment in programming by genre channel, as we sought to maximise the impact Y T I V I AT E R C IN G IN T S E V IN > spent on the digital TV channels, up 20% Network originations in Channel 4’s year-on-year, of which £27 million went of our original commissions. While overall TV schedules as a proportion of total Total investment in originated and acquired programming broadcast hours on originated content – up 14% from 2009. across the Channel 4 portfolio by genre, £m commissioning spend on the digital channels increased, the total number of first-run Peak (6–10.30pm) All day 100 originated hours on these channels fell as a 78 59 Channel 4 Investment in original content 75 Film 79 61 (main channel) Originations continued to account for 132 result of the ending of the high-volume More4 83 76 the majority of our content spend, with 121 Drama News. This meant that there was a slight fall in 83 75 More4 157 the average daily hours of first-run originations 21 30 £362 million invested in originated content 177 Factual 24 28 E4 across all services in 2010. This was down 3% per day across the portfolio (excluding live 29 2010 from 2009. This reflects the amount of time it 27 Comedy streaming of Big Brother-related programmes). 2009 93 We broadly maintained a mix of genres, takes to get commissions on-screen, meaning Source: Channel 4 85 Entertainment that while we were able to invest in some fast with increases in first-run originated hours Rounding differences may occur 22 24 News for factual and comedy. The volume of news dropped following the decision to cut More4 Kirstie’s Homemade Home 15 Meeting Channel 4’s licence obligations 13 Current Affairs News and scale back the lunchtime bulletins

9 Education and on the main channel, as we sought to prioritise Compliance 12 Older Children the main Channel 4 News programme and Average hours per week Minimum 2010 2009 7 7 Sport investment in news online. As a result of our education commissions moving wholly online News 2010 (Total: £566m) 2009 (£541m) in 2010 (see page 62), there were no first-run in peak time (6–10.30pm) 4 4 4 Source: Channel 4 Rounding differences may occur television hours in the Education and Older Current Affairs Volume of first-run originations by genre Children category. Across the main channel, E4 and More4 overall 4 4 4 in peak time (6–10.30pm) 1.54 3 2 Hours of first-run originations shown programmes commissioned by the network across the Channel 4 portfolio by genre as a whole (“network originations”) accounted Hours per year 20 for 53% of all broadcast hours and 61% 10 Film Schools 0.5 21 377 of all peak-time hours, broadly the same levels 191 as in 2009. The breakdown for the individual 195 Drama channels is shown in the chart “Programming Percentage 2,151 Original production 1,937 Factual mix on the main channel”. overall 56 58 60 41

29 Comedy Licence requirements in peak time (6–10.30pm) 70 77 79

775 We met all our quantitative licence Independent production 25 86 85 785 Entertainment requirements in 2010, exceeding our obligations European independent production 10 49 54 237 450 News in areas such as production in the nations European origin 50 66 70

158 and regions, originated hours in peak-time Subtitling for the deaf and hard of hearing 90 93 91 163 Current Affairs Audio description 10 14 12 and audio description. 0 Education and Signing 5 5 5 16 Older Children Regional production 35 39 37 425 367 Sport Regional hours 35 45 45

2010 (Total: 3,998 hours) 2009 (3,954 hours) Production in the nations 3 4.5 N/A

Source: Channel 4 Source: Channel 4 Rounding differences may occur 10 11 there are few significant changes year-on-year, of respondents selecting Channel 4 in 2010, we have seen a marginal decline in our 29 points above the next highest channel, performance across the measures. It is BBC One. Our current affairs and important that audiences feel we are delivering documentary strands – such as Dispatches on our remit, and as we refresh the schedule and Cutting Edge – in particular contributed To deliver our and inject more creative risk-taking and to our reputation in this area, while other ambition into our commissioning in the programmes cited by respondents included coming years, we aspire to strengthen our lead Big Brother, Hollyoaks and Shameless. remit effectively over other channels in these key measures. In line with our remit to promote To reflect our remit to stimulate debate, alternative views and new perspectives, we ask O O

VI W IE RV E V we ask audiences which channels make them viewers to state which channel most allows W IE RV E V we need to challenge, stop and think, and which are the most people an alternative point of view. 26% of provocative. We performed strongly on these respondents chose Channel 4, level with 2009.

NG AN IPCT IMPAC N A G IN K A M > measures in 2010, with 24% of respondents We maintained a lead on this measure over T IMPAC N A G IN K A M > provoke and inspire selecting Channel 4 as being the channel that both the average for the other main PSB is best for showing programmes that made channels and over the next highest channel, them stop and think (2009: 25%). Our lead BBC One – although both leads fell year-on- over the next highest channel, BBC Two, year. A wide range of programmes contributed widened. We increased our already strong to Channel 4’s reputation in this area, reputation for being ‘provocative’, 39% including news, documentaries and The way in which we reach people with our Making content – both the general population and Amish: World’s Squarest Teenagers specific audiences – is assessed in Engaging“ an impact the Audience”. Across all these chapters, we draw on a range of research to assess how audiences respond to and engage with our content. It is not enough for Channel 4 simply This includes industry data on TV viewing to commission and distribute content. and online usage, and our ongoing audience To deliver our remit effectively, we need tracking statements which measure our it to have impact – to be different, to be reputation relative to the other public service innovative, to challenge, provoke and inspire. broadcasters. We also present the results of By playing to their various strengths, bespoke research commissioned by Channel 4 different genres enable us to fulfil our remit examining the impact of particular and have an impact both on the audience programmes and projects. and the wider world. Documentaries, dramas and comedy can all provide intimate insights Key reputational values into complex subject matter, highlight In this section, we focus on our overall brand important issues and stimulate debate. reputation – an essential way of understanding Digital media allows audiences to engage and audience impact. Here, we present eight interact with content in new ways. News and tracking statements drawn from our regular current affairs stimulates debate that can drive audience surveys, which reflect important real-world change. elements of our remit. Through face-to-face Throughout this report we look at the interviews and an online panel, viewers are different ways in which we have delivered asked to state which of the five main public impact in 2010. In “Doing things the Channel 4 service channels (BBC One, BBC Two, ITV1, way”, we illustrate how our commissioning Channel 4 and Five) is best for a series of ethos ensures our content is innovative and statements covering different kinds of output. diverse, as well as outlining our impact on The results show that we have maintained the creative industries of the UK. Individual a strong reputation for promoting alternative chapters on the main genres explain views and for being distinctive, stimulating our editorial intentions, highlight key and inspiring – with significant leads over the programmes, strands and digital media other broadcasters in all of these areas. While projects, and assess our impact in these areas. it is encouraging in a year of transition that

12 13 international current affairs strand Channel reputations Our documentaries were strong drivers Channel reputations Unreported World. People who believed Channel 4 is the channel of our reputation in this area, with Dispatches People who believed Channel 4 is the channel Channel 4 continued to rank the highest to which the following statements most apply… and Big Brother also cited by respondents. to which the following statements most apply… in our key indicators for inspiring change As the main PSB channels find it particularly Makes me think about things Shows programmes that make me stop and think – with 18% of respondents selecting it as being challenging to engage younger audiences with in new and different ways the best channel for giving them new ideas, public service content, our reputation for being and 22% selecting it as being best for making 13pt ‘youthful’ is also a key point of distinctiveness. 14pt them ‘think about things in new and different lead over average 32% of people selected Channel 4 as being the lead over average for other channels 24% for other channels ways’. However, we saw a slight decline in for programmes 20% most youthful of the main channels, slightly for making viewers 25% 24% 24% both our overall performance and our lead that make viewers down on 2009 but still markedly ahead of the think in new and 15% 22% 14% stop and think different ways O 12% 11% O VI W IE RV E V over other channels in this area, which we other channels. However, our leads on these 8% 8% W IE RV E V on will seek to improve upon through our creative Level with last year 2009 2010 latter two measures fell slightly. Creating last 2009 2010 2pts year renewal process. Channel 4 Average for other Next highest content that feels unique will continue Channel 4 Average for other Next highest main PSB channels PSB channel main PSB channels PSB channel NG AN IPCT IMPAC N A G IN K A M > We broadly maintained our reputation (BBC One, BBC Two, to be a priority in the years ahead as (BBC One, BBC Two, T IMPAC N A G IN K A M > for content that is distinctive – maintaining ITV1 and Five) we look to improve upon these results. ITV1 and Five) strong leads in all measures in this area. Takes a different approach to We strengthened our reputation for taking Is provocative subjects compared to other channels ‘a different approach to subjects compared to other channels’, with 33% of respondents 30pt 23pt selecting Channel 4 as being the best channel, lead over average lead over average 37% 39% for other channels for other channels 31% 33% 22 points above the next highest channel, for taking a for being BBC Two. 36% of people selected Channel 4 provocative different approach 11% 11% to subjects 10% 10% 10% 10% as being best for covering ‘ground that other on 9% 9% compared to other last channels channels wouldn’t’, level on 2009 and 23 2009 2010 2pts year 2009 2010 on Channel 4 Average for other Next highest points ahead of the closest competitor, Five. Channel 4 Average for other Next highest last main PSB channels PSB channel main PSB channels PSB channel 2pts year (BBC One, BBC Two, (BBC One, BBC Two, ITV1 and Five) ITV1 and Five) Jamie’s 30-Minute Meals Facejacker Covers ground other channels wouldn’t Allows people an alternative point of view

26pt 14pt lead over average lead over average for other channels 36% 36% for other channels for covering ground for allowing people 26% 26% 19% 17% that other channels 12% 12% an alternative wouldn’t point of view 11% 11% 9% 10% on on last 2009 2010 last 2009 2010 1pt year 1pt year Channel 4 Average for other Next highest Channel 4 Average for other Next highest main PSB channels PSB channel main PSB channels PSB channel (BBC One, BBC Two, (BBC One, BBC Two, ITV1 and Five) ITV1 and Five)

Is youthful Gives me new ideas

11pt 25pt lead over average lead over average 34% for other channels for other channels 32% for being youthful for giving viewers 17% 16% new ideas 20% 11% 18% 10% on last 8% 8% on 8% 8% year last 1pt 2009 2010 1pt year 2009 2010 Channel 4 Average for other Next highest Channel 4 Average for other Next highest main PSB channels PSB channel main PSB channels PSB channel (BBC One, BBC Two, (BBC One, BBC Two, ITV1 and Five) ITV1 and Five) Source: Ipsos MORI commissioned by Channel 4 Source: Ipsos MORI commissioned by Channel 4 Rounding differences may occur Rounding differences may occur

Channel 4 tracks audience perceptions of the main PSB channels using Note: The term “percentage points” (and the abbreviation “pt”) face-to-face and online interviews. The face-to-face interviews take place over refers to the absolute difference between the two percentages five waves during the year. The online interviews, which take place over three 14 waves during the year, have a larger sample size and enable to the responses 15 of people from different demographic groups to be examined. NG THNGS TH N WAY 4 L NNE A H C HE T S G HIN T G IN O D WAY 4 L NNE A H C HE T S G HIN T G IN O D Doing things the Channel 4 way

Channel 4 exists to offer something different – to surprise, to challenge established orthodoxies, to pioneer fresh approaches. In a world of increasing homogeneity we aim to bring originality and innovation, and breathe life into new ideas. Our distinctiveness on-screen stems from the ethos

Inside Incredible Athletes of creative diversity that lies at the heart of everything we do. 16 17 Hollyoaks were new to the organisation. We hope these Channel 4’s investment in the nations and regions numbers will increase in future years as the

new Creative Diversity department works Output from Proportion of Channel 4’s first-run originated to broaden our supply base. In addition, suppliers based output and spend on the main channel made outside London: we are also building relationships with a range in the nations and regions in 2010 Volume of output (hours) Investment in output (£m) of new digital companies. Across digital media 45% we worked with 91 suppliers in 2010, of first-run commissioning many companies, such originated programme hours 45 39 as Fish in A Bottle in the West Midlands 55 61 on and Tag Games in Scotland, for the first time. last

NG THNGS TH N WAY 4 L NNE A H C HE T S G HIN T G IN O D pt year WAY 4 L NNE A H C HE T S G HIN T G IN O D To broaden our supply base, we look for 1 37 talented suppliers across the country. This 45 benefits the creative economy whilst enabling 39% Out of London Quota (35%) London 2009 figures us to better represent life in different parts of of the value of first-run Source: Channel 4 the UK on-screen. In 2010 we increased both originations Rounding differences may occur the value and volume of first-run originated on last content on the main channel that comes from 3pts year the nations and regions of the UK. Across the channel portfolio, we spent £125 million on Channel 4’s investment in the production companies based outside London. A particular sector outside London priority was to expand supply from Scotland, Percentage of Channel 4’s expenditure We can best achieve our creative ambitions Broadcasters’ investment Wales and Northern Ireland. Thanks to major across the TV channel portfolio outside in the production sector £125m by working with the broadest pool of talent, commissions including 4thought.tv (Belfast), spent on production London by region companies based 2009 2010 taking risks, partnering with a wide range Expenditure by public service broadcasters That Paralympics Show (Cardiff) and Frankie outside London of organisations, innovating in the form and £321m on ﬁrst-run external commissions, £m Boyle’s Tramadol Nights (Glasgow) our 7 11 investment in Total (£m) distribution of creative ideas and representing first-run external expenditure in the Nations accounted for 2009 341 81 422 Level with last year UK commissions the diversity of the UK. For Channel 4, 2008 4.5% of our first-run originated spend on the 36 51 36 49 on the main 304 82 386 BBC diversity is not a question of ticking boxes. channel in 2010 2009 254 254 main channel (exceeding our 3% quota) and It is much more fundamental; it stems from 2008 323 323 ITV1 11% of our portfolio spend outside London. 6 4 on 2009 the range of people we work with and the last 339 24 363 This was a significant increase from 2009 – 5% year 2008 389 32 421 Channel 4 North of England South of England blend of content we commission, as well 2009 69 69 with an additional £4.4 million spent across Midlands Nations (Scotland, 2008 96 96 Five Wales and as the different groups we represent. the portfolio on projects in Scotland alone. Northern Ireland)

When we get this right, it is what makes Main channels Digital channels We have also looked to broaden the spread of Source: Channel 4

us home to ideas and voices that would not Source: Channel 4, Ofcom (Other channels) our digital commissioning, including projects The data presented in this chart represents 2010 data not available for other channels spend outside London for all channels in the be found anywhere else. in Bath, Dundee and Sheffield. From 2011, Channel 4 portfolio; 2009 data has been we have committed to spending at least 35% restated to include the digital channels Diversity of supply Diversity of supply base of our digital media commissioning budget Creative diversity begins with diversity outside London. of supply: we aim to work with the widest Number of independent production Our desire to broaden our supply base companies supplying the PSBs possible mix of talent from across the UK and 266 extends to communities that are under- production 276 from a range of backgrounds. The broader the companies supplying 289 BBC Portfolio represented in the industry. In 2010 we production base, the more wide-ranging the programming to the 83 worked with production companies such Channel 4 portfolio 69 ITV Portfolio in 2010 experience will be for viewers. 293 Channel 4 as Maroon Productions and Juniper The main Channel 4 service invested on 318 Portfolio Communications, which draw their talent £321 million in first-run external UK last 78 9% year 97 Five from diverse ethnic backgrounds, as well commissions in 2010 – a slight fall from 2009 30 as placing a special emphasis through our (see pages 10–11). The latest industry data (for 28 Other digital channels (max) online education projects on working with ‘It’s all about backing 2009) shows that we spent more on the external 2009 2008 female writers and developers, a group still creative teams and production sector than any other commercially Source: Channel 4, Broadcast (Other channels) under-represented in the digital media sector. funded public service broadcaster, and worked 2010 data not available for other channels We also developed initiatives, such as the people, and Channel 4 with more independent suppliers than any Production Trainee Scheme, giving talent certainly put their other broadcaster. Our own figures show from marginalised backgrounds experience that we commissioned programmes across in the industry. money where their the channel portfolio from 266 different At the culmination of two years in which mouth was’ companies in 2010, more than 10% of which Channel 4 chaired the Cultural Diversity Shane Meadows, Director 18 19 Network, 280 production companies had Diversity output on the main channel respondents – with a 23 point lead over the Channel reputations signed the CDN Pledge to improve diversity average for other PSB channels compared People who believed Channel 4 is the channel to which the following statements most apply… within the broadcasting industry. Total hours of programming covering to a 16 point lead across all respondents. 120hrs diversity issues shown on the main channel At the start of 2010 Channel 4 won of first-run (2010 with trends relative to 2009) Shows the viewpoints of different ethnic groups Diverse voices originations the television rights to the London 2012 Channel 4 has a specific remit to cater covering diversity 225 All originated Paralympic Games – a unique opportunity issues on the 17 to diverse audiences. We deliver this not main channel to transform the way disability sport and 12 BBC One of which 120 First-run 16pt by relegating cultural diversity to the niche of which 91 In peak disability itself is perceived in the UK. We lead over average 9 on for other channels 8 BBC Two but bringing it into our mainstream output last kicked off the build-up to 2012 with several 6% year (1% down) (6% up) (23% up) for showing the 6 in imaginative and compelling ways. In 2010 Paralympics-related programmes, such as viewpoints of 4 ITV1 Source: Channel 4 different ethnic NG THNGS TH N WAY 4 L NNE A H C HE T S G HIN T G IN O D 32 WAY 4 L NNE A H C HE T S G HIN T G IN O D groups we increased the volume of originated Inside Incredible Athletes, and a nation-wide 23 Channel 4 programming on the main channel that Channel reputations search for disabled presenters and reporters. on 4 3 Five addressed religion, multiculturalism, disability People who believed Channel 4 is the channel Our goal is for people with a disability to last 2pts year or sexuality, and significantly increased hours to which the following statements most apply… provide more than 50% of the reporting team BAME in peak-time – up 23% from 2009. Our tracker for the Games themselves and build careers All statements recognised our distinctiveness Shows different kinds of cultures and opinions in front of the camera beyond 2012. in this area, with significant leads over other Our vision for the Paralympics reflects Shows the viewpoints of disabled people channels for showing different kinds of pt our long-running commitment to bringing cultures and opinions and challenging 17 disability into the mainstream. In 2010, 10 lead over average 9 BBC One for other channels 8pt prejudice. As outlined below, we are also 30% participants with disabilities contributed lead over average 9 for showing 18% 27% substantially ahead of other channels for different cultures 16% to some of our most popular peak-time series, for other channels 8 BBC Two and opinions for showing the 3 reflecting the viewpoints of gays and lesbians, 10% 10% including a student with cerebral palsy in viewpoints of 3 ITV1 disabled people on Location Location Location and three women 12 different ethnic groups and disabled people. last 2009 2010 13 Channel 4 However, despite the increase in output, 2pts year with physical disabilities in the series How To on Channel 4 Average for other Next highest last 2 main PSB channels PSB channel in all these cases both our overall performance Look Good Naked…With A Difference. This 2pts year 2 Five (BBC One, BBC Two, ITV1 and Five) and our leads over other channels were down. series attracted a large mainstream audience Disabled In 2011 and beyond we will continue to reflect and succeeded in challenging preconceptions: All

and cater to diverse groups, and will seek to Challenges prejudice reaching a peak audience of 2.6 million Source: Ipsos MORI commissioned by Channel 4 understand and improve audience perceptions viewers, and 45% of respondents to a bespoke Rounding differences may occur of our work in this area. survey saying that it changed the way they We sought to reflect diverse cultures and 19pt think about disabled people. Our ongoing Shows the viewpoints of gays and lesbians lead over average perspectives in every part of the schedule for other channels tracking survey showed that viewers still for challenging 28% in 2010, from My Big Fat Gypsy Wedding’s 25% believed Channel 4 was the best of the main 2 prejudice pt 4 BBC One portrayal of a misunderstood community 10% 10% 20 on lead over average 5 to I Am Slave’s story of a Sudanese domestic last 6% 6% for other channels 2 BBC Two 3pts year 2009 2010 for showing the 2 slave in modern Britain and The Family’s viewpoints of gays 2 ITV1 Channel 4 Average for other Next highest and lesbians in-depth insight into a black British home. main PSB channels PSB channel 4thought.tv 45 (BBC One, BBC Two, 22 Channel 4 In our tracker statements, we continued ITV1 and Five) Provocative, powerful and moving, on last 3 4thought.tv provides a platform for to have a significant lead over other PSB Source: Ipsos MORI commissioned by Channel 4 5pts year 4 Five Rounding differences may occur religious believers and sceptics to channels for showing the views of different reflect on religious and ethical issues. Homosexual ethnic groups. This was stronger still amongst It offers viewpoints from different faiths All Black and Minority Ethnic (BAME) and cultures on issues ranging from abortion, sexuality, marriage and euthanasia. A true cross-platform initiative, it represents creative diversity in action, with the television content made by a Belfast production company, Waddell Media, and the online The Family elements, supported by Northern Ireland This BAFTA-nominated observational Screen, provided by two other Northern documentary strand returned for its Ireland companies, neither of which third series in 2010, filming the Nigerian- had previously worked with born Adesinas around the clock over a UK broadcaster. eight weeks. The series continued our commitment to show, in peak time, the diverse cultures of Britain, documenting the trials and tribulations of family life in Britain’s Black African community and the impact of changing values between the generations. 20 21 public service channels for showing the New and one-off programmes Innovation Channel reputations viewpoints of disabled people. The narrowing Innovation is a central element of Channel 4’s People who believed Channel 4 is the channel to which the following statements most apply… of this lead from 2009 highlights the challenge Number of new and one-off programmes remit and our commitment to trying new we face to make more of a noise about disability. shown on the main PSB channels between things was evident in much of our output, 230 6pm and midnight Takes risks with programmes that others wouldn’t Channel 4 has by far the strongest new or one-off whether in format or new approaches to programmes shown 2010 155 on Channel 4 reputation of any broadcaster for portrayal 2009 185 BBC One technology. Blitz Street and Inside Nature’s between 6pm 52% of the lesbian and gay community. This was Giants brought bold new approaches to the 49% and midnight 2010 268 44pt shown in our own tracking survey and 2009 293 BBC Two traditional genres of history and science. lead over average on 2010 107 for other channels reflected in two external reports published last 2009 126 ITV1 One Born Every Minute explored the potential for taking risks that % year others wouldn’t in 2010 (by the BBC and Stonewall). Teen 15 2010 230 of fixed cameras to provide unprecedented 14% 12%

NG THNGS TH N WAY 4 L NNE A H C HE T S G HIN T G IN O D 2009 272 Channel 4 WAY 4 L NNE A H C HE T S G HIN T G IN O D sexuality was a priority area for us: Skins intimacy to an observational documentary, on 2010 58 last 6% 6% continued to develop a lesbian storyline, 2009 88 Five and in Seven Days we sought to push the 2pts year 2009 2010 Hollyoaks featured the arrival of a transgender Source: Attentional commissioned by Channel 4 boundaries of reality itself, enabling viewers Channel 4 Average for other Next highest main PSB channels PSB channel teenager and Sexperience gave frank insights to influence real-life events using interactive (BBC One, BBC Two, into the challenges of coming out. Our tools. Overall we showed 230 new and one-off ITV1 and Five) tracking survey showed that Channel 4’s lead programmes in 2010 – fewer than BBC Two over the other main PSB channels for showing but a higher volume than either BBC One Is experimental the viewpoints of gays and lesbians fell in 2010 or the commercial public service channels. back to 2008 levels, after a particularly strong The 15% decline year on year was largely due 28pt year editorially in 2009. to the replacement of 3 Minute Wonder, which lead over average 38% contributed a large volume of individual one- for other channels 35% for being off programmes, with the 4thought.tv strand. experimental 17% 16% 2010 also saw further developments in on 7% 7% digital innovation, with a range of dedicated last 3pts year 2009 2010 digital projects. This included The Curfew, Channel 4 Average for other Next highest main PSB channels PSB channel an immersive educational game about civil (BBC One, BBC Two, liberties, and Such Tweet Sorrow – a critically ITV1 and Five) acclaimed partnership with the Royal Shakespeare Company and the Birmingham- Always trying something new based digital agency Mudlark, which retold the story of Romeo and Juliet through the 22pt medium of Twitter. These and other digital lead over average projects brought Channel 4 an impressive for other channels 32% 32% for always trying 37 nominations at the British Interactive something new 13% 14% Media Awards. 2010 2009 on 10% 10% last 1pt year 2009 2010 Channel 4 Average for other Next highest main PSB channels PSB channel (BBC One, BBC Two, ITV1 and Five)

Trend-setting Inside Incredible Athletes Inside Incredible Athletes formed the centre piece of Channel 4’s programmes to introduce viewers to the Paralympic 20pt Games. Using state-of-the-art scientific lead over average testing and cinematography it revealed for other channels 31% for being 30% the inside story of how Paralympic trend-setting 17% 17% ‘Smashes though preconceptions athletes achieve sporting excellence. The programme showed viewers how the 10% 10% about disabled athletes to deliver bodies of these elite athletes can adapt Level with last year 2009 2010 to their disabilities, enabling them to a portrait that is visually achieve extraordinary levels of Channel 4 Average for other Next highest main PSB channels PSB channel performance. Nine out of ten viewers (BBC One, BBC Two, beautiful and scientifically surveyed by us agreed that the ITV1 and Five)

programme opened their eyes to the Source: Ipsos MORI commissioned by Channel 4 fascinating’ talents of disabled athletes, as well as Rounding differences may occur The Sunday Telegraph the challenges they face, while two out of three said that it had changed their perception of disability sport. 22 23

Audiences recognise and appreciate New talent strands on Channel 4 Channel 4’s commitment to innovation. In our ongoing tracker survey, we maintained Strands dedicated to new talent across significant leads in 2010 over the other main 21hrs Channel 4’s television network (2010) of first-run public service channels for taking ‘risks with originations in New talent strand Slots Hours programmes that others wouldn’t’, for ‘always strands dedicated Channel 4 (main channel) to new talent 3 Minute Wonder 36 3 trying something new’, and for being ‘trend- First Cut 18 8 on Coming Up 7 4 setting’ and ‘experimental’. However there was last a small decline in our lead on several of these 51% year Comedy Labs 7 4 The Morgana Show 5 3 statements, a trend we hope to reverse in Total first-run 73 21 NG THNGS TH N WAY 4 L NNE A H C HE T S G HIN T G IN O D coming years as we introduce more risk-taking WAY 4 L NNE A H C HE T S G HIN T G IN O D Corresponding 2009 Totals 245 43 and experimentation to our commissioning. Source: Channel 4 Rounding differences may occur Next generation of creative talent Channel 4 works with creative talent throughout their careers, whether giving established voices the opportunity to try something new, or providing newcomers with their first break. In 2010, we commissioned ‘PhoneShop is modern, producer Phil Bowker to write and direct his first series,PhoneShop , while The IT Crowd’s fresh, and doesn’t Richard Ayoade worked with Film4 to direct new writers and directors with schemes such sound like too much his first feature filmSubmarine . We also gave as Cinema Extreme (with WarpX) and Future emerging comedian Morgana Robinson Perfect (with Paines Plough Theatre). We also else on mainstream TV’ a debut solo show on the strength of her added to our long-running pilot series Comedy Broadcast audition tape. Lab with online comedy project This Just In, We dedicated 21 hours of first-run originated which put a spotlight on new comedians and programming on the main channel to new their writers, helping them prepare for a first talent. This is a fall of 51% from 2009, largely foray into television. due to our replacement of the long-running Off-screen, a variety of training and talent strand 3 Minute Wonder. This decision work-related learning programmes gave enabled us to prioritise investment in strands opportunities to those already working such as First Cut, that give more extended in the sector and to young people at the opportunities to emerging film-makers, while very beginning of their careers who may also enabling us to refresh the slot with the not otherwise consider a career in the media. introduction of the faith, ethics and opinion These included several award-winning strand 4thought.tv. This provided a vital new learning initiatives and work experience platform for diverse voices and through- placements for students. A partnership provoking ideas. We continued to nurture with the Media Trust invited 16–25 year olds to make their own short films in celebration of Black History Month and offered mentoring advice to the winning contributors. We continued to support the wider development of training and skills in the Dundee games industry through our funding of the National Two companies from Dundee’s vibrant Film and Television School, The Research digital games sector, Tag Games and Centre and Skillset. We also worked with Dynamo, were commissioned to make apps for the hit television series Peep partners across the industry – from the Show and Come Dine With Me, and for Channel 4 BRITDOC Foundation to regional a new online game, Beauty Town. screen agencies – to identify and support This investment typifies Channel 4’s approach to creative diversity by creative talent from all over the UK. expanding the online presence of some of our key television programmes, working with partner organisation Creative Scotland and, at the same time, helping to grow innovative companies Submarine in the UK’s Nations. 24 25 ‘I owe the channel virtually my entire career and feel incredibly £233m fortunate to have worked with Film and Drama spend on originations and acquisitions such amazing people’ broadcast in 2010 Film Jack Thorne, co-writer, This Is England ’86

I A M A R D & M FIL & Drama A M A R D & M FIL

Good storytelling is one of the most powerful tools for Channel 4 to deliver its social purpose. Great film and drama engages audiences emotionally with stories that entertain, provoke, inspire and prompt reflection. With our films and dramas, we encourage writers, directors and actors to push the boundaries – whether they are pillars

Four Lions Joe Blogs, The Times of the creative landscape or completely untested voices. 26 27 FILM & DRAMA 29 The Observer film-making and the bestthe drama and film-making on British television this year’ this television British on ‘Delicate, finely wrought finely ‘Delicate, , . Funded . ) and ) This The Scouting This Is England Dead Man’s Once upon a Time Shameless , , This Is England (2002), to Skins , , series had the kind The Scouting Book for Boys Xuplift ), Shane ), exemplifies Channel 4’s (2004) and inpartnership with Screen Yorkshire, itand it proved tobe Channel most 4’s boundariesofhowtelevision drama Shoes usuallyfeels. His four-part perepisode. On-demand, the series seriesalso demonstrated our Mostimportantly, the audience loved successfuloriginal drama launch ever, Misfits smallscreen. With his co-writers and Book for Boys Is England ’86 In The Midlands tothe BAFTA-winning film thedistinctive Sheffield location of the totalled2.7 million views. talent,from his films Withhis eagerly awaited follow up averaging3.2 million television viewers (2007),Shane Meadows broke the commitmenttoreflecting regionalvoices. ofhard-hitting plot lines and cinematographyrarely seen onthe co-directorsJack Thorne ( commitmenttodeveloping and nurturing 16 Film4’s early involvement helped to attract total funding worth 16 times its own investment for feature films released in 2010 Tom Harper Tom ( This is England ’86 and and Mo some leaps of faith from from faith of leaps some commissioners brave some investment, along with with along investment, has invaluable’ been Tom Harper, co-director, Harper, This Is EnglandTom ’86 ‘Channel 4’s support and 4’s ‘Channel ’s Chris Morris ’s Never Let Me Go LetMe Never The Adam and TheAdam Brass Eye Brass – a Film4 production written production Film4 a – strand is a compelling way compelling strand a is broke viewing records for drama viewing for on broke records stars television many supported Film4 and Coming Up Coming ’s Richard Ayoade and Richard Ayoade ’s – were selected to open and close the London Film the London close and open to selected were – ’s Joe Cornish.this Thechannel Film4 Joe continued ’s Scouting Book for Boys for Book Scouting In drama we sought to back dynamic, distinctively back authored to Indrama sought we We also maintained our commitment to finding maintained also to commitment our talent the We The IT CrowdThe IT

2010 was a pivotal year for film at Channel 4. For For the firstfilm Channelat 4. time for year pivotal a was 2010 investing ourinscreening and film into ever, was introduced this with lift a Film4’s celebrated service we to and remit public films its – of two announcedas budget, pieces that offered viewers new anglesBritish on viewersnew life. that offered pieces Distinctivevoices of standing with Channellong relationships has some 4 original most idiosyncraticstorytellers,and directors,Britain’s new takerisksOur readinessback to and actors. and producers realise to freedom and the space people givescreative ideas with his TV made debut Meadows Shane theirIn 2010 vision. ’86 England ThisIs 127 Hours 127 creative the most of one been birth our have Since Festival. we British have we filmof successfuland because champions talent, exciting creative in backing the most believed always contemporary theanddistinctivemost theideas most investing as in filmAs well production, issues. and themes with cinema– independent for showcase a be to continued we British internationaland of film-making the best Film4 on the channelon-demand.and ’86 England ThisIs in terms weight our above punched Channelwe and 4, maintaining distinctive– dramafor reputation lead of our E4 commissioning than ITV. and less the BBC despite young dramas for that captivate home a provide to continued communities dedicated build to on-air on go and audiences experiment with ways to new continued fans, we and of 42–43). pages engaging (see of with audiences these younger from theirmake featuredebuts, to release saw the new find writers directors. 2010 to and the of Harper. Thorne Tom and Jack the scheme, of graduates two by 4Screenwriting, launched also aimedwe InNovember giving at emerging writers drama. experiencein television that we believe will retrospectives inworthy twentyof believe be thatwe time.Our years’ to to Show Joe most Channel 4’s of with support, some retrospectives of distinctiveand directors, Dannyincluding Boyle celebrated Mikeand Leigh.

FILM & DRAMA 28 Reflecting society and challenging taboos Fiction can be just as powerful as investigative journalism in revealing truths about the modern world, by telling stories that stimulate curiosity about contemporary Britain and beyond. In 2010 the BAFTA-winning drama Mo gave a double insight into Mo Mowlam’s private life and her public role as Secretary of State for Northern Ireland during the peace negotiations that led to the Good Friday Agreement. Any Human Heart charted the history of the 20th century through the eyes of one man and I Am Slave examined domestic slavery. LM & DRAMA M A R D & M IL F Shameless and Four Lions demonstrated that even such sober A M A R D & M IL F and weighty issues as poverty and terrorism can be illuminated by the power of comedy. Elsewhere, the Film4 channel brought viewers the work of acclaimed film-makers from around the world. Highlights included The British Connection, a season of independent British Any Human Heart films in primetime slots. Films from further afield included three classics from the Japanese director Yasujiro Ozu, the award-winning Greek filmDogtooth , which was seen ‘‘…will undoubtedly ruffle some by more people on Film4 than saw it in UK cinemas, and undiscovered gems from such far-flung places as Kazakhstan. feathers but in making the modern Overall the Film4 channel showed 704 hours of films from bogeyman a figure of fun he may countries other than the UK and the US in 2010, up 4% year-on-year (see pages 66–67). yet redress an imbalance in our collective attitude’ Innovating with distribution In addition to our investment in film development and The Times production, Channel 4’s TV channels offer showcases for independent cinema. Dedicated monthly seasons on the Film4 channel helped to create a sense of occasion around Returning audiences Four Lions the schedule and contributed to an impressive growth of 25% Featuring a wealth of British talent Long-running returning drama series are often crucial to including Kayvan Novak (Facejacker) defining a channel brand. They build loyal audiences and and Riz Ahmed (Britz, Road to can play a vital commercial role. For Channel 4 they provide Guantánamo), Chris Morris’ directorial debut Four Lions brilliantly and brutally a balance to the overall tone of the drama slate, with heavy- satirised the distorted world view hitting single dramas complemented by series that are lighter of some very amateur Jihadists. and more mischievous in tone. In 2010 our returning series By alternately mocking and humanising I Am Slave the confused and incompetent members The Home Office estimate that there may had mixed success. In its seventh series, Shameless equalled of the wannabe terrorist cell, the film be as many as 5,000 people trafficked its biggest ever audience, and Misfits grew its audience broke almost every taboo in the book. into the UK as slaves. This shocking by 86% from its launch in 2009. But viewers to Hollyoaks Made by Warp Films with the support statistic was the starting point of the of Film4 at every stage of production filmI Am Slave which told the harrowing declined, leading to a dramatic revamp of the series with and distribution, Four Lions became story of a Sudanese woman forced into new branding, producers, cast members and storylines. a critical and commercial hit, winning domestic slavery in modern day Britain. Long-running series may be reliable, but they must Chris Morris a BAFTA for Outstanding Filmed on location in Africa and the UK, Debut and earning close to £3 million it reflected Channel 4’s commitment be constantly re-invented and re-energised to keep at the UK box office. to tackling difficult subject matter and them popular, relevant and distinctive. putting little-talked about issues on the public agenda. The film triggered several press investigations into domestic £11.6m slavery and was praised in the House of Lords during a debate on international invested in feature film production ‘I am proud that the media trafficking. Another example of our and development in 2010 commitment to partnership and creative can make a difference…. talent, the film was funded in partnership with the UK Film Council I wept when I watched and the Film Agency for Wales, directed by Gabriel Range (Death Of A President) that programme’ and written and produced by the team Baroness Massey of Darwen in the House of Lords behind Film4’s Oscar-winning The Last King of Scotland. 30 31 Key data Our key measures show that audiences valued accounted for a substantially higher proportion our distinctive approach to film and drama of viewing to Channel 4’s peak-time dramas in 2010. than to those on the other main PSB channels. In drama, Channel 4’s output is distinct In film, countering the market focus in terms of its subject matter and its appeal towards US studio movies, almost 40% of the to younger audiences. Our audience tracking Film4 channel schedule was devoted to British, survey showed that the proportion of viewers other European and international films in choosing Channel 4 as being ‘best for drama 2010. This eclectic approach is matched across LM & DRAMA M A R D & M IL F LM & DRAMA M A R D & M IL F E L T I T N O I T C E S programmes that are different from other Channel 4’s portfolio – 33% of respondents channels’ was 8 points higher than the average claimed that the main channel is ‘best for for the other main PSB channels. Channel 4 modern independent film’, substantially more was chosen by more people than chose BBC than chose any other channel. One or ITV1, even though they commission more output in this genre. 16–34 year olds

‘I can’t imagine how my life would have been without Channel reputations Diversity of Film4 channel schedule Film4. And it gets better People who believed Channel 4 is the channel to which the following statements most apply… and better – ever friendlier, Percentage of output on Film4 % channel by region of origin Is best for modern independent film 39 more supportive and above of output on the 2009 2010 Film4 channel devoted to British, all, warm and loving’ other European 9 9 and international 26 25 Mike Leigh, Director, Another Year 23pt films lead over average for other channels 33% 6 6 31% on 60 61 for being the best last for modern 15% 14% pt year independent film 1 10% 9% UK USA on last 2009 2010 Rest of Europe Rest of World 2pts year

in the channel’s share during 2010. Tie-ins with retailers Channel 4 Average for other Next highest Source: Channel 4 main PSB channels PSB channel helped reach wider audiences; for example Film4’s World (BBC One, BBC Two, Rounding differences may occur Cinema New Horizons season, which highlighted classic ITV1 and Five) international youth films such asY Tu Mamá También and Is best for drama programmes that Drama viewing by young audiences City of God, was promoted across HMV’s 279 UK stores. are different from other channels As part of our remit to innovate with new forms of Percentage of viewing to originated drama distribution, we updated the Film4 website and launched an pt 41% programmes on the main PSB channels 8 of viewing to between 6pm and midnight accounted online on-demand film rental service with Filmflex. More than lead over average for by viewers aged 16–34 for other channels originated drama programmes on 500 films were available to view at launch, including the latest for being the best 20% 2010 17 Channel 4 between for drama 21% 2009 17 BBC One Hollywood releases, British classics and cult independent and programmes that 6pm and midnight are different from 12% accounted for by 2010 11 foreign-language films. The service reflects our aim to develop (No data available) other channels 16–34 year olds 2009 12 BBC Two new commercial business models whilst also maintaining 2009 2010* 2010 13 on 2009 13 ITV1 a commitment to making independent film accessible. Channel 4 Average for other main PSB channels last 2010 41 (BBC1, BBC2, ITV1 and Five) 1pt year 2009 42 Channel 4 Another Year 2010 7 Following the success of the Oscar- Source: Ipsos MORI commissioned by Channel 4 Rounding differences may occur 2009 14 Five nominated Happy-Go-Lucky, Film4 continued its long relationship with *New tracker statement for 2010. Data represents one Source: BARB wave of research only. No prior year data is available director Mike Leigh with Another Year, a film touching on the universal themes of family, friendship and ageing. Premiered in the UK at the London Film Festival, it won great critical acclaim - nominated for the Palme D’Or in Cannes as well as receiving Academy Award and BAFTA nominations. 32 33 SECTIONFACTUAL TITLE 3535 Factual Channel 4’s factual content goes beyond the topical headlines headlines topical the beyond goes factual content 4’s Channel current life, affairsfinding the of everyday reflects and reflect to just not seeks extraordinary It inordinary. the help to also but in Britainlife elsewhere, and contemporary points inspiring – challengingchange, it established shape beyond inworld the legacy lasting creatinga and view of programme. the m 157 Factual spend on originations and acquisitions broadcast in 2010 £

My Big My Gypsy Fat Wedding unknown to outsiders’ to unknown way of life that is almost totally totally almost is that way life of Daily Express ‘A stunning documentary into a documentaryinto stunning ‘A

FACTUAL 34 Our factual output makes a vital contribution to Channel 4’s ‘A superb public value and to our commercial success, with brand- programme defining hits that also help deliver our obligations to inform, One Born Every Minute that makes challenge and inspire audiences. Where some other channels One Born Every Minute gave audiences rely more heavily on entertainment and drama, factual unprecedented access to the highs and you feel smarter programming is at the heart of what we do, representing the lows of childbirth, from the perspectives of soon-to-be parents and hospital staff. for just having majority of our original commissioning spend and featuring As well as insights into differing styles prominently in our peak-time schedule. of parenting and the modern family watched it’ it gave a fascinating eyewitness view From traditional documentaries to innovative formatted of life in the NHS. It was hugely popular, The Times programming, our factual output in 2010 was dedicated to averaging 3.8 million viewers across its A AL UA T FAC exploring what makes society tick – through intimate portraits 8 episodes. It was also a great critical L UA T FAC success, winning the 2010 BAFTA for of family life, history, public institutions and the world beyond Best Factual Series. A dedicated website Britain. We also aimed to bring subjects to life with engaging supported the series with exclusive formats and groundbreaking online content, such as the clips and expert advice. Emmy-nominated online show Embarrassing Bodies Live. This approach has enabled us to reach an elusive young adult audience with content that has a social and educative purpose. 2010 was a fruitful year for piloting and experimentation, with several outstanding single films providing the blueprint for longer-running television series in 2011.

Reflecting modern Britain Across the year we aimed to give audiences a wide-ranging view of the values and institutions of contemporary Britain. Genius of Britain In this landmark series, leading scientific Revolutionary camera techniques provided fresh perspectives figures told the stories of British ‘…raw, unadorned on life in all its complexities – from the hospital ward scientists and inventors who have helped (One Born Every Minute and The Hospital) to the police station shape our modern world. Experts of the humanity on display stature of Stephen Hawking and David (Coppers) and the family home (The Family and Seven Days). Attenborough introduced viewers to the …it was tremendous’ As is inevitable with pioneering ideas, not all these shows people behind the development of the The Daily Telegraph fulfilled our ambitions. For example, whileSeven Days broke steam engine, the splitting of the atom, the theory of evolution and the invention new ground by giving viewers direct influence over the series of the world-wide web. The series had a through social media, it proved less successful as a programme considerable educational impact – with format. This provided a lesson for future attempts at 81% of respondents to a bespoke survey on the programme agreeing that they integrating television and digital tools – viewers are drawn learned a lot about scientific discoveries to the new and the experimental, but still want storylines and from it, and 66% agreeing that it had characters that can engage and entertain in traditional ways. made them more interested in science. Elsewhere in the schedule, Titanic: The Mission, Genius of British Art and Genius of Britain opened up significant moments in Britain’s past. 4thought.tv and The Family explored the diverse make-up of modern British society. 9 out of 10 How The Other Half Live and Tower Block of Commons viewers surveyed by Channel 4 agreed looked at the reality of poverty and its social consequences, that Genius of Britain was entertaining as well as educational. while the impact of unemployment during a recession was the subject of The Fairy Jobmother.

36 37 Alternative perspectives Channel 4 seeks to give space to opinions and cultures % ‘A fascinating bout that seldom surface in mainstream media. Amish: World’s 68 of myth-busting and Squarest Teenagers explored diverse values and faiths, of viewers said that Channel 4’s factual and My Big Fat Gypsy Wedding, one of our highest-rating programmes inspired change in their lives enlightening science’ programmes of the year, took a vastly entertaining and The Mail On Sunday informative approach to the values and rituals of one of Britain’s least understood and most maligned communities, winning a Cultural Diversity Network award in the process. Much of our programming shares a similar ambition to ACTU L UA T C FA challenge preconceived ideas, as demonstrated by programmes L UA T C FA on disability and a variety of series that probed some of society’s most sensitive social taboos. The Sex Education Show examined pornography, underage sex and the intimate relationships of disabled and older people. Angus Macqueen’s polemical War on Drugs questioned the entrenched positions that underpin public policies on drugs.

Making a difference From Jamie Oliver and Sarah Beeny to Gok Wan and Dr Pixie McKenna, Channel 4’s factual presenters are experts in their respective fields, giving trusted advice and inspiring ideas on anything from the food we eat to the homes we live in. Audience research shows that viewers strongly associate Channel 4 with programmes that inspire change; for example, almost a third of the viewers of Supersize vs Superskinny said it made them think about changing something in their lives. 65% of viewers to Jo Frost’s Extreme Parental Guidance said that they learnt something new about parenting and bringing up children. The website for Embarrassing Bodies continued to feature comments on how its open and honest advice had prompted people to seek potentially life-saving medical advice.

Amish: World’s Squarest Teenagers This series followed five young Amish people as they left their closed communities in the USA to spend time Bringing learning to life with young people in Britain whose Much of Channel 4’s factual content has an educational views and values were radically different from their own. As much as it afforded dimension running through it – from informing people about a window onto a little-known faith what goes into the food they buy to providing new ways of community, the series also provided making specialist subjects in history, science and the arts more Inside Nature’s Giants an unusual prism through which to view The BAFTA-winning Inside Nature’s Giants the faith, morality and values of young accessible. 2010 was no exception. We sought to bring original returned for a second series in 2010. people in contemporary Britain. perspectives to what are usually regarded as dry topics – for Scientists took their dissection tools The result was a fascinating cultural example, biology in Inside Nature’s Giants, or history in Bloody to a great white shark, a Burmese exchange, for participants and python, a lion, a tiger and a giant squid, audiences alike. Both the Amish and Foreigners. We used real explosives and innovative technology to unravelling how these animals hunt, the British participants said they conjure up the reality of war in Blitz Street. This proved eat and breed. The series has generated learnt from each other and found the to be an engaging experience for viewers, with 52% of a legacy of ambitious research for the experience eye-opening and informative, scientific community, while giving while one viewer wrote in to tell us respondents to a survey commissioned for Channel 4 saying the viewers an opportunity to observe How to Look Good Naked “it turned my understanding of how programme had made them think about history in a new way. natural history with a rare immediacy. …With A Difference the Amish live upside down”. 38 39 FACTUALSECTION TITLE 41 41

ITV1 Five 4pts 4pts 7pts 3pts 1pt 2pts BBC One BBC Two Channel 4 Change2009vs 66 68 269 2 253 232 45 25 92 2009 68 2010 12 Any inspiring change statement(s) It made me think about its subject in new and different ways It made me think about changing something in my own life I tried something new or different after watching this programme I talked about the programme to other people I looked for further information elsewhere after watching this programme 9 9 34 10 6 7 1 Hours of originated programmes covering leisure, life-skills and hobbies shown on the main PSB channels between 6pm and midnight Percentage of viewers who said that Channel 4’s factual programmes inspired change in their lives (2010) Source:Ipsos MORI commissioned Channel by 4 Source: Attentional commissioned by Channel 4 r on on last year t t

hrs Inspiring change through factual programming Programmes covering leisure, life-skills and hobbies a s n e a y o l % pts Channel 4 seeks to inspire change to Channelthrough seeks 4 % of viewers of saidthat factual Channel4’s programmes inspiredchange in theirlives 5 68 253 programmes of coveringleisure interests,life-skills shownand hobbies Channel on 4 between6pm andmidnight 4 programmeslife-skills coveringleisure, and hours 253 The main channel showed hobbies. midnightinand these genres 6pm between still fall5% more a from 2009but in2010, thanmainthe channels. other PSB of any 4’s Channel that showed research audience New factualprogrammes inspired of 68% think to try differently, something respondents the talkinformation or about more seek new, refresh programmeAstheothers. we to inspire to withseries that seek new schedule this hope we audiences, challenge and our willincreasein future years. Nexthighest PSBchannel Nexthighest PSBchannel

13% 13% 22% 20%

29% 25% 2010* 2010 Averagefor other mainPSB channels (BBCOne, BBCTwo, ITV1and Five) Averagefor other mainPSB channels (BBCOne, BBCTwo, ITV1and Five)

22% 12% Channel4 Channel4 (No data(No available) 28% Source:Ipsos MORI commissioned Channel by 4 Roundingdifferences occurmay *Newtracker statement for 2010. Data represents one researchofwave only. priorNo year data availableis 2009 2009

Is bestdocumentaries for Is presentthat alternativeviews Is best for provocative documentariesbestprovocative for Is pt pt 29% of respondents cited Channel 4 cited respondents of 29% Key data Key 12 average over lead other channelsfor being for the best documentaries for thatpresent alternativeviews Channelreputations channelthe Channel is Peoplebelieved who 4 followingstatementswhichthe to most apply… 16 average over lead other channelsfor being for the best provocative for documentaries Levelwith lastyear to aspires factual output Channel4’s distinctive, be challenging inspiring.and thataudiences show Ourstatements tracker difference of points Channel 4’s appreciated inthese areas in 2010. documentaries provocative for being best as than any substantially more chose in2010, main thechannels other Two, (BBC PSB of Innew a 20%). scored place, insecond that Channel said also 4 25% statement, documentaries that present for best was (22%) Two BBC of views, ahead alternative the for the average of ahead points 12 and mainchannels. PSB . In . Coppers Moving and the Erasing David detailed the significant , Berlin , Film Festival winner impactthe film has had both on ideasthat highlight social justice, peace innovativeorganisation documentaryfor Septemberalso we pledged our support CatalystAwards, development a fund Channelis the4 founding sponsor ofthe ChannelBRITDOC 4 Foundation, an privacycampaign film forthe Foundation’s new Puma Creative foundation’saward-winning feature End of the Line tosupport international documentary thesocial impact of2009 Sundance hit tosay. 2010 In showed we several ofthe to Mars films, including Grierson winner film-makers with something important Channel Foundation 4 BRITDOC consumerbehaviour and public policy. orenvironmental issues. Research on The Yes Men Fix The World Team Time . We harnessed the We . continuing to link continuing to food- to David Bond’s critique of the critique of Bond’s David to investing in ground-breaking Landshare Erasing David Erasing series of the year’ the series of The Times the documentary the be well ‘Might Inside Nature’s Giants Nature’s Inside As well as inspiring as Aswell change in individuals, Channelmany 4 How To Look Good Naked Good Look To How

surveillancesocietyin and historical and scientific research that nobody else in the world world else in the nobody research historicalscientific and that In 2010 social impact. broader a make to programmeslook with Hugh together, digitalbring of to people media potential growers with available open spaces. Other programmes spaces. aimed open withgrowers available is doing. is in efforts to get body image lessons on the national curriculumthe national on image lessons body get efforts to to leave an academic legacy – with shows such as as such with – legacy shows an academic leave to we gave a platform to a range of campaigns, from Gok Wan’s campaigns, range a Wan’s fromof Gok to platform a gave we Fearnley-Whittingstall’s

FACTUAL 40 SPOTLIGHT > E4 43

year olds Misfits The Inbetweeners The Inbetweeners Thethird series of ledtorecord-breaking audiences for withE4 an average audience million of4.1 forevery episode. The final episode was thechannel’s highest-rated show ever, averaging4.2 million viewers, and the serieshelped daily E4’s share amongst 16-34year olds exceed 8%for the first time.The series string wona ofawards in2010, including the Rose d’Or for BestSitcom, and is nowbeing developed asfeature a film. Misfits series BAFTA-winning The E4 isE4 the digital channel 16-34 year olds feelclosest to. Whenasked to rate how close they feel to each channel,E4 is the digital channel 16-34 year olds feelclosest to, based onquantitative a survey returnedhighly a successful for second seriesautumn in 2010, following the adventuresteensgroup ASBO a of of cametermsasthey to with their superpowers.comedy-dramaThe doubledits first series audience and continuedexplore to innovativeonline approachesstorytelling to with new – games,videos, Facebook andTwitter applicationsreleased toweekevery enableits fansfind out moreto about charactersthe andupcoming plottwists. interview Twitter live A thewith of one characterstrending became UK topic.a Thereweremoremillion than 10 page websitethe of viewsE4.com on across secondthe runof the series and280,000 playsits of immersive online game across year. the 16-34 , Big Bang Bang Big , , Scrubs , and late-night late-night and , site attracted site The Cleveland Show TheCleveland Skins Hollyoaks Freshers Hollyoaks . returned with a new series, tackling tackling series, new a with returned , E4 brought British E4 viewersthebrought , best Glee . Fans of E4 shows could also enjoy exclusive exclusive enjoy also could shows E4 of Fans . Skins One Tree Hill OneTree remained a high-profile show, premiering episodes episodes premiering show, high-profile a remained and ‘E4 has a trail-blazer… been ‘E4 entertaining,consistently different’ and daring Broadcast Hollyoaks Later Hollyoaks Theory new hitsfrom America. new This included an animation that launched with great success in early 2010 aninwith2010 animation early greatthatsuccess launched drama theand musical major social and personal issues such as mental illness and and illness mental as such issues personal and social major humour. and style of sense its sacrificing without sexuality Hollyoaks spin-offs exclusive developing as well as series main the from drama, online an including – show The games. and video content, online video million 5 and views page million 55 remarkable a official its on fans million 2 than more with – 2010 in views page. Facebook acquisitions US of best The long-running to as Inseries such addition US long-running drama series to keep them relevant and topical. topical. and relevant them keep to series drama long-running popular hugely The 3% 3% 10% 1% 3% 4% 17% 13% 16% Level 14.4 13.5 Year on yearon changeYear 69 attracting attracting 9.2 4.5 4.4 4.1 3.8 2.8 2.3 1.9 The Inbetweeners The Source:BARB Viewing share for the top 10 channels amongst 16–34 year olds as a percentage of total viewing by this age group ChannelNews 4 Dave BBC One BBC ITV1 Channel4 Two BBC E4 Five ITV2 BBC3 CBeebies and and

r t t

Most popular channels for young viewers a s n e % a y l o

PhoneShop % young audiences (see pages 49 and 50). and 49 pages (see audiences young drama teen Contemporary launchpad successful a be to proved has E4 an demonstrating as well as ideas new for re-energise and re-invent continually to ability them. Despite a limited budget compared to to compared budget limited a Despite them. E4’s increased we 2010 in channel, main the channel the and 36% by originations of hours of terms in weight its above well punched digital popular most the remained It impact. withaudience viewers, younger for channel ahead viewers old year 16–34 amongst share withthe Five, and channel digital other any of Two. BBC on closing gap comedy young for home The impressive its strengthened E4 2010 In such series with comedies, new for reputation as 1 4.4 viewingshare E4amongst for year olds 16–34 . Glee to to themes ofsocial acceptance and Glee’s

The Inbetweeners The

followed upits success quicklyinthe by US becoming E4’s success stems in large part from its its partfrom large in stems success E4’s

original commissions. These prove that young young that prove These originalcommissions. they – television in interest lost not have people to relevant is feel they that content want just E4 plays an important commercial and and commercial important an plays E4 portfolio. within 4’s Channel role creative exciting most our of some of home the is It favourite a is and drama, and comedy new television all of fickle and elusive most withthe an Despite olds. year 16–34 audiences: young for market competitive increasingly record-breaking a was 2010 attention, people’s share, overall its increased It E4. for year channel digital popular most the remained raft a won viewers, old year 16–34 amongst at year the of channel including awards, of Awards, Freesat the and Awards Broadcast the most the of some for responsible was and UKtelevision on programmes about talked from – thatthey found the series original and inspiring.

Glee Glee Spotlight on: Spotlight a UK cultural UK a phenomenon. Itregularly beat both digital and terrestrialcompetitors, with its highest-rating episode averaging2.6 million viewers. Aswith shows, many ofE4’s its onlinerelationship with fans was as important as its on-air relationship,with 6.8 million catch-up views on4oD,website a thatattracted 4.2 million visits, hundreds ofviewer comments fromviewers onE4.com and thousands more across Twitter andFacebook. Audience research revealed that viewers identified strongly with

SPOTLIGHT > E4 42

‘Channel 4 nurtures and takes a chance on young, bright talent £122m and I am honoured to be part Comedy and Entertainment spend on originations and of its family’ acquisitions broadcast in 2010 Comedy & Morgana Robinson

ED AIM T N INME TA R E T N E & DY ME O C Entertainment T N INME TA R E T N E & DY ME O C

Entertaining the nation is a serious matter for Channel 4. Hit comedy and entertainment shows are a vital part of defining our brand and our values, and provide some of our best-known faces. As with so much else we do, success in this area is about being distinctive – pioneering new formats, experimenting with new technology, finding and nurturing new talent, and taking the creative risks that other channels shy away from. 44 45 ED AIM T N INME TA R E T N E & DY ME O C T N INME TA R E T N E & DY ME O C

‘The Alternative Election Night really did have fresh policies to offer’ The Independent

Our ambition is nothing less than to define comedy for a new Alternative Election Night generation. In 2010 this has meant investing significantly Channel 4’s Election coverage featured in new series, alongside the return of our four BAFTA-winning a special four-hour programme, hosted sitcoms and sketch shows. Commissioners spent much of the by David Mitchell, Jimmy Carr, Lauren Laverne and Charlie Brooker, which year piloting new ideas and developing new relationships with sought to give viewers an irreverent suppliers, and towards the end of the year a late upturn in twist on the traditional results coverage advertising revenue meant we could bring forward the launch on the BBC and ITV. Co-commissioned by the Comedy and Current affairs of several new comedy and entertainment titles. This included Frankie Boyle’s departments with the aim of engaging satire and sketch shows as well as entertainment ‘event’ formats Tramadol Nights younger audiences with a political that provide exciting ways for the digitally savvy to have The first solo series from the Glaswegian format, the programme enlivened the comic blended acerbic stand-up with discussion of unfolding election results fun online. absurdist sketches. Tackling social with comic perspectives. It proved to be Comedy and entertainment will continue to be key areas taboos in the realms of politics, disability a winning formula, peaking at 2.8 million of re-investment and renewal in 2011. While we will continue and religion, the series set out to Alternative voices and breaking taboos viewers and beating ITV’s more provoke and entertain in equal measure. conventional coverage of the night’s to be a home for distinctive ‘cult’ hits with dedicated While it polarised the audience, the Comedy allows us to provoke debate and represent alternative events. The programme proved communities of fans, we see part of our purpose as being to first-night launch averaged more than views in different ways. Channel 4 has a long history of iconic, especially successful in connecting with develop programmes that have the potential to break out and 1.5 million viewers, demonstrating an taboo-breaking shows, dating back to Brass Eye and The young people, with 45% of the audience appetite for comedy with the confidence aged 16-34, disproving the view that the reach mainstream audiences. to take risks. Made by a Scottish-based 11 O’Clock Show. In 2010 we set about re-asserting and young are disaffected with mainstream producer The Comedy Unit, and featuring refreshing our mischievous reputation, with Frankie Boyle’s politics. We are developing this idea in one of Scotland’s leading comedic talents, first solo series andAlternative Election Night, which offered 2011 with the launch of 10 O’Clock Live, the programme also reflected our a 15-part weekly satire show made commitment to creative diversity. satirical relief to viewers watching the General Election results. by the same team. 46 47 COMEDY & ENTERTAINMENT 49 . , the , PhoneShop ), as well as the as well as ), ), E4 E4 ), One Day in 2011. in The Increasingly Poor Pete Versus Life Campus ) and the first ever comedy ever first the and ) Pete Versus Life PhoneShop story of a man whose every move is move every whose man a storyof sports commentators,analysedby has re-commissionedbeen also starits and staralongside cast to been has Spall Rafe Film4’s in Hathaway Anne Decisions of Todd Margaret is from a first-time writer and starred writer and first-time a from is a cast. talented in unknown Set but a proved Sutton, this in shop phone mobile audiences,amongst hit young cult a be to aged viewers its of half than more with commissionedbeen has for 16-34, and further series.a Comedy Showcase series a is Showcase Comedy 4’s Channel one-off at pilotsaimed comedyof for formats ideasand pioneeringnew series for new found it 2010 In 4. Channel ( 4 Channel series for More4 ( More4 seriesfor forthcoming ( and and Comedy Comedy . Facejacker in Chris Morris Peep Show Peep frequently in fact’ in frequently The Independent ‘It had me laughing out loud, out loud, laughing me had ‘It Week The for Up Stand Fonejacker Brass Eye’s Brass television series and, series television and and Comedy Gala Comedy The Inbetweeners The trying out new emerging talent and and talent emerging tryingnew out providing a test-bed for new ideas. Beyond these these Beyond ideas. new for test-bed a providing Comedy Lab Comedy We also provide well-known Channel 4 comedy faces with faces comedy 4 Channel well-known provide also We PeteVersus Life developing are We process. the in audience triplingits film from feature a gave Film4 30, page on outlined as Launching careersLaunching UKtelevision’s of many of careers the launched has 4 Channel next finding the about passionate are we and faces, famous most more have We stars. entertainment and comedy of generation genre, other any than to comedy to dedicated schemes talent with Showcase her Robinson Morgana comic female new gave we schemes and series solo first his directorial debut, with a script co-authored by yet more more yet by co-authored script witha debut, directorial his of writers the talent, television 4 Channel provided further opportunities for new and established stand-up stand-up established and new further for opportunities provided audiences. new throughto break to talent reinventing example, for schedule; our across opportunities new BAFTA-winning the of identity the was live a game show becomingnumber a one global trending broadcastersare combining online and bean important part ofour future liveelement, with questions based on projectswith the second ever, series players,and itsat peak, more than programme’sTV audience inOctober forits second series and the title forthat month ofother3%. Few furthertwo-screen experiments will Million Pound Drop strippedacross several nights. The seriesbecame considerable a hit, with topicRetaining onTwitter. many traditionalgame show attributes, the wentonline, compared with an average televisionexperiences inthis way,and a peak a audience of3.4 million viewers attractingnearly million 1 individual Million Pound Drop eventsthat had taken place onthe day ofeach ittopical gave a show, feel. ofChannel most successful4’s online entertainmentstrategy. A brand A newentertainment format, Anaccompanying game became one 100,000players day. a 7% ofthe , Million Pound Drop Pound Million The Inbetweeners The . Digital media has helped helped has media Digital . . We have experimented with ways withways experimented have We . Pete Versus Life Versus Pete game Facejacker and and and and

Million Pound Drop

The IT Crowd IT The Comedy and entertainment programmes were also also were programmes entertainment and Comedy

of providing the fan communities of these comedies with more withmore comedies these of communities fan the providing of with – love they programmes the access to opportunities 72). page (see transmission of ahead premieres online exclusive

insecond series 995,776 playsof responsible for a significant amount of our on-demand viewing, on-demand our of amount significant a for responsible for 2010 in audiences withrecord-breaking was a striking example of this kind of two-screen experience, experience, two-screen thisof kind of striking a example was 2011. in innovation for focus a be to will continue which Crowd IT The us to revitalise live formats, allowing audiences to interact with interact to audiences allowing formats, live revitalise to us watch. they as other, each and programmes, Audience engagement and digital innovation digital and engagement Audience participation audience build to us enables innovation Digital Entertainment The ways. new in programmes our into online integrate to 4 Channel first the in of one was department games Facebook withhighlights including commissioning, for

COMEDY & ENTERTAINMENT 48 Peep Show Key data Channel 4’s desire to do things differently main PSB channels, and marginally ahead is reflected in its comedy and entertainment of the next highest channel, ITV1. output. Our audience tracker statements show 16–34 year olds accounted for a markedly audiences appreciated Channel 4’s unique higher proportion of viewing to entertainment approach in 2010, while our focus on engaging and comedy programmes on Channel 4’s main younger audiences was reflected in the viewing channel in peak-time than to corresponding profile of programmes in these genres. programmes on the other main PSB channels. 24% of respondents chose the main channel As it seeks to encourage audience ED AIM T N INME TA R E T N E & DY ME O C T N INME TA R E T N E & DY ME O C as being ‘best for cult comedy’ in 2010, interaction online, Channel 4 was particularly significantly ahead of all the other main PSB successful in driving TV audiences for channels (BBC Two came second with 15%). programmes in these genres to their websites 24% also regarded Channel 4 as being ‘best (compared to its other genres). The conversion for entertainment programmes you wouldn’t rate from TV audiences to programme see on other channels’. This again was websites rose by 65% year-on-year. significantly ahead of the average for the other

Channel reputations Comedy and entertainment viewing ‘the funniest sitcom People who believed Channel 4 is the channel by young audiences to which the following statements most apply… on television’ Percentage of viewing to originated comedy The Daily Telegraph on Peep Show 35% and entertainment programmes on the main Is best for cult comedy of viewing to PSB channels between 6pm and midnight originated comedy accounted for by viewers aged 16-34 and entertainment programmes on 15 14pt Channel 4 between 17 BBC One Nurturing hits lead over average 6pm and midnight 13 for other channels accounted for by 15 BBC Two Developing hit series and talent not only requires investment for being the best viewers aged 16-34 23% 24% 21 for cult comedy 13% 15% in new formats, but sometimes patience with existing ones. on 20 ITV1 Our commitment to allowing a series the time and space on 10% 10% last 35 last 1pt year 34 Channel 4 to grow so it can build an audience, is proving successful. 2pts year 2009 2010 22 Peep Show started slowly but by 2010 had doubled its audience Channel 4 Average for other Next highest 19 Five main PSB channels PSB channel (BBC One, BBC Two, from its first series, andThe Inbetweeners grew from an average 2010 2009 ITV1 and Five) audience of 500,000 in its first series to 4.1 million viewers Source: BARB for its third series in 2010. Other returning entertainment Is best for entertainment programmes formats have continued to perform strongly, with Alan Carr: you wouldn’t see on other channels Online engagement with Channel 4’s comedy and entertainment content Chatty Man growing its audience in season four. 12pt Conversion rate from TV audience lead over average 5.2% to website visits in the comedy and for other channels average conversion entertainment genre compared to for being the best 22% all Channel 4 programmes, % 24% from TV to online for entertainment across comedy programmes you 5.2 12% and entertainment wouldn’t see on 3.2 Comedy and Entertainment (No data available) programmes other channels 2009 2010* on Channel 4 3.9 2.3 All Genres Channel 4 Average for other on main PSB channels last 2010 2009 (BBC1, BBC2, ITV1 and Five) 65% year Source: Channel 4 Source: Ipsos MORI commissioned by Channel 4 Rounding differences may occur

*New tracker statement for 2010. Data represents one wave of research only. No prior year data is available

The IT Crowd 50 51 ‘Thank God for Channel 4 News … utterly invaluable’ £38m Time Out News and Current Affairs spend on originations and acquisitions broadcast in 2010 News &

EWS & CU F RS IR FFA A T N E R UR C & S W NE Current Affairs S IR FFA A T N E R UR C & S W NE A commitment to fearless, challenging news and current affairs is central to fulfilling our remit to stimulate debate and provide a window on the wider world. With in-depth and challenging analysis of the biggest issues of the day and stories on important subjects that nobody else is covering, our journalism aims to deepen understanding of the modern world, give voice to those who would otherwise not be heard and inspire tangible change.

What the Green Movement Got Wrong 52 53 NEWS & CURRENT AFFAIRS 55 Dispatches:Britain’s Witch Children , an , also Britain’s When exposed Kids Don’t Dispatches Dispatches , and , an undercover . m . The . decision tofocus its stimulated audience debate, Britain’s Islamic Republic Politicians for Hire , featured , an online maths quiz investigationofthe plight ofchildren in investigationsinto domestic UK issues inappropriateconduct former by impact,with stories that regularly hit by flagship by current affairs strand heateddebate about teaching methods budgetbigger onfewer, films (from 38 the by Commons Standards and harnessedviewer engagement with 2010was an outstanding year for Count Governmentministers, story a that Cousins Marry BritishPakistani community in Britain’sAfrican communities in PrivilegesCommittee. Dispatches Dispatches Hamlets, supportingonline content for example,– generatingnearly 10,000 comments on thatcompared players’ ability with that wasplayed more than 200,000 times totwoof the involvedMPs being rebuked theheadlines and shaped the news withbold a film on politicsTower in first-run filmsin 2009to32in 2010) Witch Children afterthe first programme and led to agenda. areasoflife inmulticultural Britain, exposéofinter-cousin marriage inthe expectedofan year 11 old pupil. The quiz onMumsnet and other internet forums. Dispatches dominatedthe news agenda and led enabledit toincrease its investigative exploredsome ofthe most sensitive channel4.comacross We the year. ourseason onnumeracy, people watched in 2010 for at least consecutive15 minutes 17.4 held held Dispatches Alternative Election Election Alternative took a polemical look polemical a took What The Green Movement Got Got Movement Green The What . Sunday Express complete roll’ complete Dispatches is on a on is Dispatches ‘There’s no doubting doubting no ‘There’s Channel 4 News 4 Channel challenged the conventional wisdom on how to respond respond to how on wisdom conventional the challenged , a co-commission with our Comedy team. We increased increased We team. Comedy withour co-commission a , news, international for reputation long-established a With

more garnered and stories withour agenda news the set actively with the news agenda and dig deeper into the issues issues the into deeper dig and agenda news withthe actively at the country’s finances, and and finances, country’s the at a willingness to challenge established views, and in-depth and views, established challenge willingness a to reportage to demand real responses from those in power. We We power. in those from responses real demand to reportage presented exclusive stories about illegal workers in the NHS and NHSand the in workers illegal about stories exclusive presented investment increased we 2010 In remit. 4’s Channel partof Goldsmith Zac took Snow Jon and scrutiny to up politicians in the kind of investigative journalism that goes beyond mere mere beyond goes that journalism investigative of kind the in analysis penetrating This included journalism. investigative interview on on interview exposed flaws in Ofsted reporting on allegations of child abuse. abuse. child of allegations on reporting Ofsted in flaws exposed our investment online, so that viewers could engage more more engage could viewers that so online, investment our of the economic crisis, and investigations into some of the of some into investigations and crisis, economic the of on powerful stories that herald real change. We regularly We change. real herald that stories powerful on they felt were most relevant to them. to relevant most were felt they day. the of issues environmental big the to barons. media to politicians from elites, power country’s stories, international on focus affairsgreater current witha – 2010 In cover. not do broadcasters other issues of coverage to task over his campaign expenses in a much talked-about talked-about much a in expenses campaign his over task to watchers, through programmes such as as such through programmes watchers, we sought to strengthen our domestic output with more withmore output domestic our strengthen to sought we impact of terms in weight our above punch to out set we RTS Journalism nominations than any other broadcaster. other than any nominations Journalism RTS Investigating the truth about contemporary Britain contemporary truth the about Investigating Challenging established views and stimulating debate is a vital a is debate stimulating and views Challengingestablished and news to approach distinctive a offers 4 Channel Night Britain’s Trillion Pound Horror Story Horror Pound Trillion Britain’s We targeted new audiences, beyond the committed news- committed the beyond audiences, new targeted We Wrong focus affairsmore current films bigger and withfewer, –

NEWS & CURRENT AFFAIRS 54 Ask the Chancellors Putting the world in focus Channel 4 is renowned for its commitment to international stories, giving prominence to voices that are too often unheard Unreported World in mainstream British media. Our Unreported World strand The Unreported World strand gives epitomises this approach and Dispatches also featured several British viewers the chance to find out about the millions of people around the award-winning international films in 2010, including world who live without basic human Afghanistan Behind Enemy Lines, Children of Gaza and rights. It brings an alternative Pakistan: City of Fear. The Slumdog Children of Mumbai perspective to familiar news stories – such as Palestine and Afghanistan won a Rory Peck Professional Impact Award, having inspired – and provides an insight into countries viewers to send donations to the Mumbai charity it depicted, and societies that are neglected by EWS & CU F RS IR FFA A T N E R UR C & S W NE as well as money to support some of the orphans who were mainstream journalism and utterly S IR FFA A T N E R UR C & S W NE unfamiliar to most viewers. Its 20 films featured in the film. across the year included reports on child Channel 4 News enhanced its reputation for international labour, the American exit from Iraq, news stories with an investigation into the civil war in Sri Lanka overpopulation and witchcraft. In Malawi’s Child Tobacco Workers and and a special investigation into abduction and trafficking of Afghanistan’s Child Drug Addicts we women in Mexico, which prompted an investigation by US looked at the plight of vulnerable authorities. It also provided acclaimed coverage of Haiti children. Zimbabwe’s Blood Diamonds revealed how Robert Mugabe’s Zanu PF in the aftermath of the earthquake. party uses gems from the world’s biggest diamond fields to buy the military’s loyalty. Increased investment ‘The first big gave Unreported World a strong online presence, with exclusive clips and behind social-media event of the scenes interviews on the main Channel 4 site as well as a presence the election campaign’ on Facebook. Rory Cellan-Jones, BBC

‘Compelling brave film-making’ Unpacking the economy The Daily Telegraph The British economy dominated the news agenda in 2010, Channel 4 News: Sri Lanka and Channel 4 responded with a series of innovative live studio For the second year running, Channel 4 programmes that put the audience at the heart of the debate. News won the Amnesty Award for Ask the Chancellors saw the three men hoping to be in charge Television for its coverage of Sri Lanka’s 30 year civil war. Despite being deported of the nation’s purse strings set out their differences in the first and banned from the country, the televised debate of the Election campaign. This inspired Channel 4 News team continued to considerable audience reaction, becoming a global trending pursue undercover investigations, with powerful testimony to the crimes topic on Twitter. Just before polling day we provided viewers allegedly committed by Government with the facts behind the party leaders’ claims on spending cuts forces in the conduct of the war. in What They’ll Never Tell You and, as Chancellor Osborne A horrifying video that appeared to show Sri Lankan soldiers executing Tamils that announced his spending review plans, we invited the audience had been broadcast by Channel 4 in 2009 to make their ‘virtual’ spending cuts on an interactive and denounced by the Sri Lankan programme How to Save £100 Billion Live. Viewers at home government as fake was declared, after extensive investigations by the UN, to be played along online in a specially devised game, Chop or Not, authentic. Channel 4 News subsequently and the results were fed live into the televised debate. obtained a longer uncut version of the film, which provided further information on the location and time of the incident and the names of those involved. This evidence, and the reports that followed ‘Channel 4’s current it, have been instrumental in the establishment of a United Nations panel affairs output is to gather evidence of possible war crimes in Sri Lanka. often the best on British television’ The Daily Telegraph Unreported World: Pakistan’s Terror Central 56 57 Engaging audiences online Key data In recognition of the particular social impact and immediacy of online journalism, Channel 4 invested more of its online Channel 4 News Online Channel 4 News was watched (for at least Extended running times enable topical budget in news and current affairs in 2010 than in any other The Channel 4 News website was 15 consecutive minutes) by an average of issues to be covered in greater depth. Across genre. As well as providing a forum for online comment on its relaunched in September 2010, with 11.2 million people each month in 2010. the year, Channel 4 showed 279 “long-form” programming, Channel 4 News launched an improved website, a sharper focus on the expertise and experience of the Channel 4 News team, It was disproportionately popular amongst news and current affairs programmes – increased the use of social media and promoted key investigative particularly in the field of international young and Black, Asian and Minority Ethnic defined as those running for more than 45 online brands such as FactCheck. News video was made affairs. As well as special online reports news viewers. Annual viewing trends showed a minutes – in peak time (6–10.30pm), more available on mobile platforms, iPads and other tablets. and in-depth analysis of key issues, we sought to give the audience a stronger, mixed pattern: viewing fell by 2% overall. than the combined number on the other more personal relationship with the While the proportion of the Channel 4 News main PSB channels. The number of these EWS & CU F RS IR FFA A T N E R UR C & S W NE programme and its presenters through audience represented by young people rose programmes rose by 9% in 2010, with new S IR FFA A T N E R UR C & S W NE use of blogs and social media. Around 30,000 people follow the main Channel 4 by 5 points, there was a 2 point decline series such as Coppers and Tower Block of News Twitter account and Factcheck in the proportion of BAME audiences. Commons more than offsetting a small decline doubled its audience in 2010 as a result According to regular viewers to each in the number of editions of Dispatches. of its relaunch as a blog. It achieved some significant successes, for example of the main news bulletins, Channel 4 News forcing Prime Minister Gordon Brown continued to be regarded as more independent to admit he had quoted a wrong figure – from the Government and from the influence for the defence budget at the Iraq Independence of TV news Inquiry after the site investigated his of big businesses – than the other main claim. The service was noted by the providers of TV news in 2010. Percentage of regular viewers to House of Commons library as a useful TV news programmes in 2010 who resource for political statistics and 83% of Channel 4 News agree with the following statements: research. The relaunch of the overall site viewers regard it proved highly successful – with visits in to be independent ‘It is independent the final quarter of the year up 41% from from Government from the Government’ Year on year change 2009 and video views up 273%. on BBC News 63 2pts last 1pt year ITV News 69 2pts Channel 4 News 83 1pt

Five News 69 1pt 9,792 Sky News 77 Level Percentage of TV news viewers viewer comments on 11.2m who watch Channel 4 News ‘It is independent from the people watched influence of big businesses’ Year on year change channel4.com for Dispatches 2010 25 Channel 4 News 2009 26 All news viewers each month BBC News 68 1pt 2010 27 News viewers ITV News 59 on 2009 26 aged 16–34 1pt last Channel 4 News 72 2pts 2% year 2010 30 BAME 2009 33 news viewers Five News 57 Level ‘Factcheck… Source: BARB Sky News 60 1pt Source: Ipsos MORI commissioned by Channel 4 is an invaluable Viewing to National News Rounding differences may occur

service’ Percentage of viewing to national news Commitment to long-form journalism Evening Standard % programmes on the main PSB channels 23 in 2010 accounted for by viewers aged 16–34 of viewing to and BAME viewers Channel 4 News Number of news and current affairs programmes on programmes with a duration of 45 minutes Viewers aged 16–34 Year on year change the main channel 279 long-form news or longer shown on the main PSB channels in 2010 accounted BBC One 10 Level and current affairs between 6pm and midnight for by viewers 14 programmes in peak aged 16–34 BBC Two 2pts TOTALS ITV1 11 1pt 2010 58 56 114 BBC One on on 2009 87 46 133 (BARB) last Channel 4 23 5pts last year 2010 63 228 291 BBC Two 5pts year 12 9% Five 1pt 2009 53 207 260 (BARB) 2010 7 7 14 ITV1 BAME viewers Year on year change 2009 86 14 (BARB) 2010 Channel 4 BBC One 4 Level 279 1 280 2009 257 8 265 (Internal) BBC Two 7 1pt 2010 141 0 141 Five 4 ITV1 1pt 2009 74 0 74 (BARB) Channel 4 10 2pts 5 Peak Post-peak Five 3pts (6–10.30pm) (10.30pm–midnight)

Source: BARB Source: Channel 4, BARB (other channels) 58 59

‘The Channel 4 Education slate consists of imaginative and engaging £9m 2010 spend including online games and web projects… and projects and broadcast highlights some of the UK’s best schools programming Education & indie games and creative talent’ The Guardian

TION & OLDER CHLDREN E R D HIL C R E D L O & N O I AT C U D E Older Children N E R D HIL C R E D L O & N O I AT C U D E

Alongside the compelling educational content shown across the schedule, we have a special responsibility to provide educational and schools-related material for teenagers. From 2010 we also have a new remit to cater for older children and young adults. We aim to connect with these audiences by wrapping educational subjects – from Second World War history to sexual health advice – within entertaining, playful and immersive formats that feel

The Curfew relevant to young people. 60 61 EDUCATION & OLDER CHILDREN 63 has helped I’ve become moreI’ve Battlefront Battlefront Battlefront award-winningThe political participation projectreturned second a season, for followingteenagers 12 asthey campaignedissues on closetheir to heart fromattitudes our – towards disability bullying to schools. in Highlights included gettingcelebrity backingcampaign a for againstairbrushing andseveral campaignersmeeting Primethe Minister Number 10.at projectThe featured dedicated a online trackedthathub progressthe the of campaigners,including blogs, videos generated (which 90,000 over views Facebook activity.2010), andTwitter in audiencethesiteThe alsoplatform gave a campaigns,theirset up own to including mostthe make impact. to advicehow on Qualitativeresearch projectthe on effectivecanbeit showed making at peoplethink about things differently, respondents20 out of with 16 strongly agreeing“ that interestedcertain in causes issues”. or projectthe As willseekit evolves fresh waysmaximising of its impact and extendingits reach, including through televisionexposure. me realiseme therethat arelots things of peopleyoungthat out care11 about”. strongly20 of agreed result “asa that visiting of passion’ fronted by a range a range by fronted of spirited young young spirited of enthusiasts, each The Daily Telegraph with a differentwith ‘Battlefront is is ‘Battlefront Empowering young people Usinginteractive media turn to viewers active into participants has remained a vital with – our strategy of element in 2010 projects as such Battlefront aimed harnessing at the power digitalof inspire to tools action and tangible social change. audiences new Reaching to commitment its and voice of authenticity 4’s Channel young with connect to it enables difficultsubjects tackling Engaging audiences ways. effective particularlyin people reach to hard find may providers education formal that commissioning was it whether – 2010 in objective central a was health with sexual targetingboys children, older for projects readers’. ‘reluctant engaging or advice uses , 73% , away with SuperMe SuperMe Privates was downloadable a sex Sarah Brennan, YoungMinds 85,000downloads and also BIMA wona and shows shows and about their about their it is ok to talkit to ok is down barriers down isnotoriously hard toreach with emotions’ basedgames developer Zombie Cow, Onlinethe game attracted more than ustoreach users that educational usersabout STIs and contraception. usersofcomputer games. Channel 4 providersmay not otherwise reach. medicalinformation, but who are active forBest Game. Privates gamingmagazine enablingPC Gamer, gave copies gave of thegame was specifically targeted at post-pubescentat boys, group a that Privates educationgame designed toeducate educationalcontent, and particularly A first-time A commission from Liverpool- teenagers that teenagers that quizzes,videos, celebrity interviews andgames toteach young people about emotionalresilience and the best ways ofdealing with challenges that life may throwyou.at Audience research demonstratedboth the popularity and impactofthe project with – 62% ofusers surveyedsaying that they learned somethingnew from SuperMe Aninteractive format exploring mental healthand resilience, sayingthat they would recommend it and 75%saying that the quizzes onthe site madethem think about their actions. ‘SuperMe breaks breaks ‘SuperMe , , and an online online an and , SuperMe was based on the diary the entries on based was The Untold Battle of Britain of Battle Untold The , a groundbreaking game set in a fictional fictional a in set game groundbreaking a , (a first-time commission from Pressure Comics) Comics) Pressure from commission first-time (a 303 Squadron 303

The Curfew The

% Alien Ink Alien There was also a greater focus this year on informallearning, on this year focus greater a also was There In recognition that a linear morning schools schedule is not not is schedule schools morning linear a that recognition In remit new a of introduction the marked also year The in role important an played also team Education Our

62 of users surveyed said that they learned something new from SuperMe lives, people’s young affect that issues exploring withprojects adulthood. to teenager from particularintransition the help to project witha theme, major a life-skills was Promoting resilience, gainemotional people young of the Polish soldiers who fought for Britain in the Second Second the Britainin for fought who soldiers Polish the of by complemented was which game, The War. World documentary, primetime a appeal to designed way a in wartime history presented audiences. younger to to people young introduce to aimed Security State, modern British two won game The civilliberties. and privacy of issues Project. Educational Best including Awards, Media Interactive which featured storylines about real-life pressures experienced experienced pressures real-life about storylines featured which and sex to parents and relationships from today, teens by alcohol. Making education relevant Makingeducation earlier programmingfactual outlined specialist withour As sought projects education online 4’s Channel report, the in relevant. engagingand subjects educational specialist make to game web The comic Online games, video and websites formed the focus of our 2010 2010 our of focus the formed websites and video games, Online 14–19 for projects schools-related and educational in investment and lives people’s young affect that issues addressing olds, year life-skills. promote and inspire to tools participative using agreement people, young reach to way effective most the always applying quota schools the that withOfcom reached was level, nominal a to reduced be should channel main the to across projects digital on focused 2010 for withinvestment platforms. of range a that recognising adults, young and children older to cater to withhigh-quality UKunderserved particularly is thisgroup one into this responsibility integrate to decided We content. faces group age old year 10–14 the believe we as department, older the to similarways in media consumes and similarissues for. cater already we teenagers giving emerging by – 4 Channel to talent digital bringingnew commissions, network firstnational their developers digital under- currently are who withgroups working by and women including sector, media digital the in represented ethnicminoritybackgrounds. from those and

EDUCATION & OLDER CHILDREN 62 EDUCATION & OLDER CHILDREN 65 828 15.3 , 14.1 548 Privates , for which complete complete which for , 2010 2009 2010 2009 Source: Google Analytics Google Source: project, each to visitors UK unique of *Number projects active all across summed Analytics Google Source: Number of UK visitors* to education projects online, 000s Average time spent on Channel 4’s education sites by UK visitors, minutes per visit r t t

a s

n e r a * Bow Street Runner BowStreet t t mins

y o l a s Reach of education content online Engagement with education content online k n e a y o l % % Evolving the way we assess and understandand assess we the way Evolving 2008 a exclude measures thekey Note: “Dwell time” measures how long visitors visitors long how measurestime” “Dwell 1 Channel4’s to to education projectsonline 828 UKvisitors 15.3 on spent Channel4’s education an on sites averagevisit 5 9 and reliable data are not available. are not data reliable and download). a as gameoffered a was which the time for dwell theaverage In2010, minutes 15 exceeded projects Education highervisit,9% per than the 2009figure. willonline our impact focus an areabe of hope Channel goingforward. 4 We for measures Education additional develop to partthis as of work. project, spent online for those projects that had thathad projects those online for spent than other projects (all websites 828 15.3 14.1 548 2010 2009 2010 2009 Source: Google Analytics Google Source: Source: Google Analytics Google Source: project, each to visitors UK unique of *Number projects active all across summed Number of UK visitors* to education projects online, 000s Average time spent on Channel 4’s education sites by UK visitors, minutes per visit r t t

a s

n e r a * t t mins

y o l a s Engagement with education content online Reach of education content online k n e a y o l % % 1 Channel4’s Key data Key to to education projectsonline 15.3 on spent Channel4’s education an on sites averagevisit 828 UKvisitors 9 5 Reflecting Channel 4’s focus on delivering on focus Reflecting4’s Channel people young for commitments Education its new throughdeveloped have digital we media, with these engagement that measuresassess Education new eight In 2010, online projects. further a and launched, were eight projects available. be to years continued from previous UKsummedunique visitors, of Thenumber 828,000, over just was these projects, across the corresponding increaseon 2009 51% a figure. both due Thissubstantial was rise were (just four projects of the larger number to withavailable four another in 2009, launched rise in the26% average a from2008) to and project. UKper visitors of number was an early example Cover Girl Older children TheDigital Economy Act has for the first timegiven Channel remit a 4 toprovide contenttoolder children, who are broadlyunderserved with high-quality content. UK define We this group as those withinyearthe 10-14 old age group. 2010 In commissioned we research into thehabits and pastimes ofthis group discovering,that, as with older teens, can we engage them effectively through gamesand online activity. 2010 In started we tocommission educationalformats for this younger audience.The results will mostly beseen in2011, but the media literacy game - launching - theat end ofthe year and allowingyoung girls toexplore for themselvesthe way photographs and advertsinmagazines are airbrushed andadjusted. Players were invited to ‘enhance’photos fictionalfor a fashion magazine,encouraging better a understandingofthe methods used magazines by and advertisers tosell beautyproducts. that already have a strong strong a have already that Hollyoaks and and T4

creative as you like’ as you creative reign to be as blisteringly be asreign to blisteringly There’s pretty free much There’s Dan Marshall, Zombie Studios Cow Founder, completely amazing… completely ‘Channel 4 have been been 4 have ‘Channel projects education our for ways new seek to will continue We and power the harnessing including groups, new reach to people, young amongst brand 4 Channel the of reputation commissions tying will be more We impact. increase to order in withpartner to will look and programming themes withour in as such brands presence with the teen audience. teen withthe presence

EDUCATION & OLDER CHILDREN 64 SECTIONSPOTLIGHT TITLE > In TERNATIONAL 67 67 itsrichculture, culinary by Channelseason of by 66% 4, Channelleadingthe is 4 TV programming,examining storiesshapethat ofone Indianwinter season season a In soughtthat to surveycommissioned a In together current& film, news traditionshumanandthe most world’s thediverse affairsandfactual andcaptivating countries. explorebroughtIndia, we viewersagreed that channelraising for awareness global of issues. insearch oflife-changing Sixordinary British families SouthAfrica, Cambodia to uproottotravel the globe My Family’s My Crazy Gap Year seriescaptured their travels theday-to-day grind and treksand adventures in experiences.From Nepal to oncamera as they swapped conventionalroutines for exoticand remote corners ofthe world. Australia,this observational Filmand drama Factual CurrentNews & Affairs (excluding daily news) Key:

45 strandon 9 1 3 3 38 History Other Science Mugabe and the White 0 , which followedone, 01 2 True Stories The African brave family’s attempt brave to protecttheir farm andworkers duringviolentMugabe’s ‘LandReform’ programme. More4showcases bestthe of internationaldocumentaries, the2010 saw year. weeksa 52 strandincrease its audience range a ofandshow 21% by criticallyacclaimed films. Thisincluded multi-award winning 6 9 28 14 18 28 Current affairs Religion Documentaries 9 0 0 3 Genres covered by international-themed originations on Channel 4 (main channel) as a percentage of total first-run hours 2 Source: Channel 4 Rounding differences may occur

r t t

a Range of international programming s hrs n e a y o l True Stories True True Stories True Mugabeand the White African % on More4 on 136 first-run of programmes covering international on topics Channel 4 (excludingnews) and 3 , engaging , My Family’s Crazy Crazy Family’s My Film4:World Cinema channel’s Film4 The cinema world commitment to demonstratedyear was this award-winning with a international and films highlightingregular slot the greatest auteurs - world’s classicsincludingJean from BergmanandIngmar Renoir, the Across YasujiroOzu. featuredchannel schedulethe countries from as films Russia,Japan,Mali, as diverse Argentina,Korea,South Kazakhstan. and Greece and and I Am Slave Am I on More4 – a combined total of of total combined a – More4 on , and the best of international cinema cinema international of best the and , In 2010 our output included original drama included output our 2010 In as such commissions as such formats entertainment factual Escape Great Gordon’s Year Gap increased We channel. Film4 the on showcased first-run international of output our of hours 65 showing 2010, in programmes international covering programmes first-run of hours 71 and channel main the on topics Stories True programmes originated first-run of hours 136 addition in More4, and 4 Channel across Film4. on films feature of range extensive an to Unreported Unreported . Channel 4 aims 4 Channel . . programme and around and programme but also Haiti’s Killer

True Stories True

and and by stand-alone by documentaries,ranging fromthe plight ofLandina, discoveredmiraculously aliveinthe award-winning The Miracle tothe Babyscience behind the of Haitiquakeitself in Channel 4 News Thedevastation ofthe massiveHaitian earthquake wascovered not just by Haiticoverage

Quake: Why it Happened International Spotlight on: Spotlight Channel 4’s new remit includes a responsibility responsibility a includes remit new 4’s Channel prominently Most world. wider the reflect to current and news this throughour do we affairsbrings Britishprogramming, which pressing most the of coverage viewers daily our This includes issues. international News 4 Channel 60 hard-hitting documentaries in hard-hitting documentaries 60 World to do more than just report from international international from report than just more do to examine to want we – though battlegrounds, their of allcultures in foreign celebrate and the about curiosity stimulate and diversity, schedule. our of whole the across world wider

n TERNATIONAL

SECTIONSPOTLIGHT TITLE > I 66 66 Our audience is at the centre of everything we do. We aim to produce high-quality public service content with a broad appeal, while also catering to diverse groups within society. Across the year we sought to extend our impact on all our audiences and across all platforms, with digital channels and new online services affording viewers a chance

NG TH UDI E C N IE D AU HE T G IN G A G N E to engage with us, and each other, in new ways. E C N IE D AU HE T G IN G A G N E

Engaging the audience

One Born Every Minute 68 69 Shameless We measure audience engagement with Audience Reach Average daily television viewing Channel 4’s content in a variety of ways, from the big picture figures of TV viewing and Average monthly reach of public Average daily minutes of viewing to the 87.8% service broadcasters’ TV portfolios 28mins public service broadcasters' TV channels online visits, to the personal feedback we get average daily Difference* of all TV viewers 2010 95.8 viewing of from individual viewers and the audience reached every month 2009 95.5 BBC 47 41% less across Channel 4’s Channel 4’s 80 BBC 2010 research outlined in this report. TV channels 92.0 TV channels 2009 91.8 ITV 35 36% less 55 ITV on 2010 87.8 on 31 13% more Television last 2009 87.5 Channel 4 last pts year 2mins year 28 Channel 4 Television remains a hugely powerful and 0.3 2010 71.1 2009 69.4 Five 10 29% less 14 Five

NG TH UDI E C N IE D AU HE T G IN G A G N E popular medium, and Channel 4 continues to E C N IE D AU HE T G IN G A G N E Viewers aged 16–34 (upper bars) be important to its viewers. Total TV viewing Percentage reach of individual was resilient in 2010, and Channel 4 remained TV channels in Channel 4 portfolio All viewers (lower bars) Source: BARB the third most viewed broadcaster in the UK 2010 82.1 Channel 4 after the BBC and ITV. 2009 81.8 (main channel) *Viewing by 16–34 year olds compared to viewing 2010 38.8 by all viewers Almost 90% of television households 2009 35.1 E4 Data for Channel 4 includes Channel 4+1 watched Channel 4’s TV channels every 2010 36.4 and excludes S4C (see note on Page 70) month in 2010 (for at least 15 consecutive 2009 35.0 More4 2010 31.7 minutes of viewing) and average daily viewing 2009 28.2 Film4 Medium-term viewing trends of Channel 4’s programmes rose slightly 2010 10.3 2009 10.0 4Music year-on-year. Percentage change in viewing to the Source: BARB, 15 minute consecutive, 5% public service broadcasters’ channel But as digital switchover increased average monthly reach, all people growth in TV portfolios between 2005 and 2010 competition for viewer attention, our overall Channel 4 (main channel) includes Channel 4 +1 channel portfolio BBC but excludes S4C. In all charts sourced from BARB -7 viewing share ITV portfolio share fell slightly to 11.4% – down in this section, figures prior to 2010 have been over the last five -5 Channel 4 restated to exclude S4C from 11.5% in 2009. It was an especially years – the only 5 public service challenging year for the main channel, which declining audiences to some of our longer- Five TV viewing share broadcaster to -8 saw a 6% decline in viewing share, reflecting running series as well as the challenges have grown its portfolio share faced by all other terrestrial channels over this period Channel 4 portfolio share as a Percentage decline in viewing to main 11.4% percentage of total TV viewing from multi-channel competition. PSB channels between 2005 and 2010 viewing share Total (%) Our digital channels grew their share BBC One across the TV 2010 7.0 4.4 11.4 -11 ‘What a brilliant, channel portfolio by 8% in 2010. Film4 had a particularly strong BBC Two 2009 7.4 4.1 11.5 -27 year: its eclectic mix of films is especially ITV1 on 2008 8.1 3.7 11.8 -21 powerful story’ last Channel 4 2007 8.6 3.1 11.7 popular on Freeview, contributing to a 25% Viewer comment on Mo 1% year -27 2006 9.6 2.3 11.9 Five growth in viewing. E4 also enjoyed significant -29 Channel 4 (main channel) Digital channels growth, of 6%, although the 1% rise in viewing to More4 was not as strong Viewing share of digital channels as in previous years. as a percentage of total TV viewing Medium-term trends show the important Source: BARB Total (%) role played by the digital channels, with Data for Channel 4 includes Channel 4+1 2010 1.8 1.1 1.2 0.3 4.4 and excludes S4C (see note on Page 70) 2009 1.7 1.1 1.0 0.3 4.1 Channel 4 the only public service broadcaster 2008 1.6 0.9 0.9 0.3 3.7 to have grown its portfolio share over the five Viewing to network originations 2007 1.5 0.7 0.8 0.1 3.1 years up to 2010. 2006 1.5 0.5 0.4 2.3 Channel 4’s distinctiveness is derived Percentage of total TV viewing E4 Film4 in large part from our original content. 66% accounted for by network originations More4 4Music/The Hits on Channel 4's TV channels The highest-rated shows in 2010 reflect the of total viewing Total (%) Source: BARB across the main diversity of our original output, including channel, E4 and 2010 5.1 1.5 1.9 2.9 11.4 Data for Channel 4 includes Channel 4+1 entertainment programmes such as Big More4 accounted and excludes S4C (see note above) for by network 2009 5.4 1.4 2.0 2.6 11.5 Rounding differences in the charts are Brother, dramas such as Shameless and Mo, and originations due to reporting of channel shares and factual content such as My Big Fat Gypsy Network originations Acquisitions (non-commissions) totals to one decimal place on Main Digital Main Digital Wedding, Embarrassing Bodies and One Born last channel channels channel channels 1% year Every Minute. Original content commissioned Source: Channel 4, BARB

by the network filled 53% of the hours on the In the chart, the digital channels are E4, More4, Film4 and 4Music. The main 66% figure is based on viewing main Channel 4 service, E4 and More4 and to the main channel, E4 and More4 and excludes viewing accounted for a disproportionately high 66% to Film4 and 4Music of total viewing across these channels. Data for Channel 4 includes Channel 4+1 Mo and excludes S4C (see note on Page 70) 70 71 ENGAGING THE AUDIENCE 73 136 102 19.2 30.0 9.7% 17.1% 6,103 21.1% 9,792 5,079 13.5% 13.6% 40.1% 6,034 14.8% 6,299 10.0% 25.6% 29.6% 17,405 14,200 33,394 32,064 Total (m) Total (m) Total 433,497 563,867 fromTV* 18 Comments Conversion Big Brother Big Visits that include include that Visits Brother Big 187 817 542 119 1,105 1,414 2,551 3,051 2,618 2,756 5,484 10 3.1 92 26.9 Visits(000s) 1.8 17.4 Sites other than Big Brother Big than other Sites Visits that do not not do that Visits Brother Big include 2009 2009 2010 2010 Average monthly page views, millions Source: Channel 4 Channel Source: 4music.com include to restated been has 2009 for Data occur may differences Rounding film4.com. and Datafor Channel includes 4 Channel 4+1 andexcludes note S4CPage on (see 70) 2009 for available data of months 9 *Only possible not comparison year-on-year full so Average monthly visits to Channel 4’s websites, millions Source: Channel 4, BARB, third-party online service providers service online third-party BARB, 4, Channel Source: directly Not transmission. per viewer TV per *Visits methodology see report; 2009 in data with comparable details more for document Channel 4 programmes with the highest conversion rate from TV audience to website visits (2010) Programmes with most submitted comments on channel4.com and e4.com (2010) r t t

a s n e

a y o l * on on last year m k Engagement with Channel 4 content online Engaging Channel 4 viewers online programmes %

% 0 1

pts p o 6 19 averageconversion fromrate TV to onlineacross the T 360 visits to Channel4’s websites 56 652 commentson channel4.com ande4.com Million Pound Million and , we gave usersthe gave we , . In 2010 we announcedmoves we In . 2010 had the highest conversion rate thehighest had conversion Such Tweet Sorrow Tweet Such Seven Days Seven Skins on Channel4, what a great a great what Channel4, on in Playing along show. quiz tandem online is fun too’ fun is tandem online Twitter comment on Million Pound Drop to to ‘watching #millionpounddrop #millionpounddrop ‘watching Digitalfund innovation 4iP commissioned Ethnic minorities tend to be particularlyEthnic be to minorities tend Our online investment in 2010 prioritised inOur 2010 online investment opportunityinimmerse the themselves to characters, withconnect of lives viewers, other We ideas. shareinformation contribute and experiences the viewers’ quality to of added onlineincluding material, withexclusive games.and interviews, videos, music critically range a projects, of acclaimed including Papa Sangre Papa online activities Channel integrate 4’s to commissioning, with content closely more maximise platforms. to across impact our Aspartthis, of 4iP Channel into merged 4 2010. of the end onlinethe wider at team these changes willbelieve to us allow We with impact digital greater our content. deliver audiences diverse Cateringto commission to requires remit it Channel4’s to tastes thatspecifically the appeals content culturally a of interests and society. diverse reflect lives to the sought we the year Across from different people of interests and engagethatin also ways but backgrounds, included in 2010 Our output audience. wider a programming range a of hard-to- aimed at ethnic adults, young including groups reach people. minoritiesdisabled and highdigital of consumers TV channels. viewing result, As a BAME by audiences channels service broadcasters’ the public to than thoseless is theto viewing levels In 2010 thepopulation. general channels by smallerfall-off a therewas in viewing amongst portfolio Channel 4’s BAME to audiences 2009. 2009. audience with – thetelevision 40% of in2010 thevisit website. to goingon From content. multiplatform Drop 18.2 31.0 Total (m) Total Big Brother Big Peep Show 1.4 were given the and 29.6 0.6 The IT Crowd 17.5 PhoneShop Programmes other other Programmes Brother Big than 2010 2009 in a similar ina way.askingBy viewers to registertowatch the previews, also we gaininsights into who they are and how may we be able toengage with them further.Developing this in-depth understandingofour viewers will strategicbe a priority for Channel 4 inthe future. 4oD and The Crowd IT Viewersof opportunitytoview an exclusive online premiereofthe first episode of the new seriesbefore it was broadcast on Channel4. 168,000 people registered to viewit, with remarkable a 69% ofthese “superfans”stating that they watched theepisode again when it was broadcast. Experimentingwith online premieres enablesChannel tobuild 4 anticipation aroundseries key and reward fan loyalty, andlater inthe year launched we new seriesof Source: Channel 4 Channel Source: occur may differences Rounding Average monthly full-length Channel 4 programme views initiated, millions r t t

a s n e a o l y Making Channel 4 programmes available on demand on available programmes 4 Channel Making m % 1 372 full-length programme viewsinitiated demand on 7 , The Big Brother Big , , Hollyoaks , , . The latest series of series of The latest . achieved nearly 8 million 8 views nearly achieved Glee and World’s SquarestWorld’s Teenagers documentary’ Viewer comment on Amish: for broadcasting broadcasting for this wonderful, wonderful, this thought-provoking Our online strategy is about much more more much Ouronline strategy about is you thank big ‘A TheInbetweeners

the year, across alone channel4.com on on- of the number for record our broke and singlein a single episode a views of demand way valuable a be to proved also 4oD day. with engagingtheir audiences of loyal right). (see ways in new content favourite deliveringthan of ways providing new in invest also programmes. We television enhance our to online content exclusive specialist range programmesa of provide and viewers. our of the interests tailoredto sites online increasedsignificantly Engagement attracting with – websites more our in2010 average, thanon millionmonth 30 visits each million the year;visitsacross 360 to equivalent up views were Page 2009. increaseon 56% a million 136 with of an average 2009, on 34% 652,000 generated We month. views each page and E4.com and channel4.com on comments to from TV rate audiences theconversion from points 6 up – 19% visitsaveraged website Digitalmedia Onlineviewing programmes our of rose offer to continued we as significantly 2010, in what watch to audiences allow to ways more the extended We they want. when they want, programming our availabilitynew two of onto alongside PS3, and SeeSaw in 2010, platforms channel4.com. and YouTube thelikes of million streams 31 all Across platforms, full-length of Channel programmes 4 were in 2010; average on month initiatedeach the year. million views over 372 of total a 2009. increaseon 71% Thisremarkable a was programmes popular 4oD our Theon most audiences younger service series aimed at were – Inbetweeners Skins

ENGAGING THE AUDIENCE 72 ENGAGING THE AUDIENCE 75 . . sought tobreak down the Seven Days Seven Days Embarrassing Bodies wallbetween television and its audience, usingsocial media toallow viewers tointeract with, and influence, the programme’sreal-life participants. Theseinteractions were then reflected backinto the programme itself. This approachinspired high levels ofonline engagement,with viewers enjoying the opportunitytodiscuss and become part ofthe lives ofthe people they were watching.More than 8%of the television audiencewent online tothe programme’s websiteand during its run, the series wasone ofthe most talked about Channelprogrammes 4 onTwitter. Overone week the programme attracted times10 as many comments on channel4.comas another popular show, . , and The , , and , attracted and saw (for which the which (for Million Pound Million Skins , , prompted 50 prompted This is England ’86 ThisEngland is Seven Days Seven The Daily Show TheDaily generated particularly generated , , Big Brother Big (following a technical hitch), technical a hitch), (following also inspired also high levels Big Brother Big , , seeing nearly 50,000 tweets as the tweetsas 50,000 seeing nearly Amish: World’s Squarest Teenagers Squarest World’s Amish: The Taking of Prince of Harry TheTaking Broadcast perpetually playperpetually it safe’ for taking a risk where where takingrisk a for other broadcastersother , , comment audience monitor also We ‘C4 should be applauded be applauded should ‘C4 Inbetweeners the platform. on discussion of Embarrassing Bodies Embarrassing channel4.com. on comments of highvolumes Channelprogrammesactive 4 also were with during 2010, Twitter on Drop with along the online game. played audience Misfits on social media. socialmedia. on Mo Difference a With Naked… Good Look to How Muslims, while the most criticised an thewhilewas Muslims,most Clinic. theMarie for Stopes advertisement Gaza Dispatches:Theof Children and over 100 appreciative comments, while comments, appreciative 100 over Republic Islamic Britain’s complaints. 833 and comments positive Nights Tramadol Boyle’s Frankie express their viewerscontactingto us 56 the opposite. do to 701 and appreciation Other programmes that received issues and included significantcomplaints numbersof III TheGodfather with continue to not thedecision of thedaily version the programme before received majoritywere appreciated transmitted).Notably programmesincluded

BBC ITV Channel 4 Five 29% less 29% less 36% less 11% less 18% more 83% Channel 4 less 7% less 6% more 9% less 7% BBC ITV Five Nexthighest PSBchannel Difference*

Other broadcasters 11% 14% 4 27.5 . 5 46.0 2

Source:BARB Source:BARB 1 . 25% 2010 20.4 9 1 33.8 9 . 6 Averagefor other mainPSB channels (BBCOne, BBCTwo, ITV1and Five) 1 15.4 25.2 23.9 23.5

11% 15% 15.0 BAME White 2010 2005 5 . 11.4 6.0 5 Channel4 10.2 6.0 4.9 25% Public service broadcasters’ portfolio broadcasters’ portfolio Public service amongst white and BAME viewing shares a percentage of total TV audiences as audiences viewing by those 16–34 year olds’ viewing share of the public service broadcasters’ channel portfolios as a percentage of total TV viewing Datafor Channel includes 4 Channel 4+1 andexcludes note S4CPage on (see 70) *ViewingBAME by audiences compared viewing to white by audiences Datafor Channel includes 4 Channel 4+1 andexcludes note S4CPage on (see 70) Source: Ipsos MORI commissioned by Channel 4 Rounding differences may occur 2009 % r r t t t t

Viewing by ethnicity Medium-term trends in viewing amongst young audiences Caters for audiences other channels don’t cater for a a s s n n e e a a o l y o l y pt % % pt 10.2 portfolioviewing shareamongst BAMEaudiences 9 growthinportfolio viewingshare amongstyear 16–34 the lastover olds fiveyears lead over average over lead other channelsfor catering for to audiencesthat otherchannels for cater don’t 14 Channel reputations People who believed Channel 4 is the channel to which the following statements most apply… 8 1 report on threatsAhmadi report on to We also sought to cater to viewerswith to cater to sought also We with retainedrelationship strong our We Overall,viewersregard Channelthe as 4 Viewer Look comment Good Naked… To on How With A Difference programme; helping helping programme;

disabled people learn people disabled to love themselves again’ themselves love to

‘Thank you for Gok Wan’s Wan’s Gok for ‘Thank you Reflecting audience opinion Reflectingaudience Enquires Centre DuringViewer our the year, times, the majority 170,000 contacted was further for beingrequests information. mixture a Thewere remainder complaints of (4,362). comments appreciative and (17,669) programmepraised Thea single was most News 4 Channel disabilities – both by creating bothby programmingdisabilities– well as theirinterests, and lives thatexplored ensuring as programmingthat our as is the hearing to and possible as accessible formal our visuallyquotas, impaired. Beyond voluntary a commitment Channelmade 4 programmes of 100% subtitling on provide to all the beginningchannels on by 2011; of 20% on description audio provide to and programmes all of channelson (compared 10%). of quota statutory a to traditionallythat is group a audiences, young service hard-to-reachwith content. public service broadcaster public the only were We 16–34 by more viewed channels were whose and than thepopulation, general olds by year service broadcaster public the only were we grownthat audience share our of have to ouryearswhole across five the last over channels. of portfolio that audiences catering for broadcaster lead in tracking studies channels other don’t: Channel 4 2010, theof course over conducted the for theaverage of ahead points 14 was ahead points channels 11 and PSB other Five. competitor, the nearest of than those of the other public service than public the other of those the main channel’s However, broadcasters. goingforwardand sharefall did from 2009, developing share our by improve to hope we engagingreaching different of ethnic ways 19–20. pages discuss on we as groups,

ENGAGING THE AUDIENCE 74 Rory Peck Awards Skins (Company Pictures) Empire Film Awards San Diego Film Critics Awards Best Actor Society 2010 Awards Dispatches – Afghanistan: Jack O’Connell Nowhere Boy (Ecosse Films) Behind Enemy Lines Best Newcomer Four Lions (Warp Films) (Clover Films) Gordon Ramsay’s F Word Aaron Johnson Best Original Screenplay Features Award (Optomen) Jesse Armstrong, Sam Bain Najibullah Quaraishi Best Food Show Evening Standard British and Chris Morris Film Awards Television The Unloved Misfits (E4) Exit Through the Gift Shop Dispatches – The Slumdog TV Collective Awards Another Year (Revolution Films) (Clerkenwell Films) (Paranoid Pictures Film Children of Mumbai NEDS (Blue Light) (Thin Man Films) Amnesty International Single Drama Best Multichannel Company Ltd) (True Vision) The Family (Dragonfly) Best Film Best Supporting Actress Media Awards Programme Most Entertaining Sony Professional Best Factual Programme Lesley Manville Misfits (Clerkenwell Films) Documentary Impact Award Never Let Me Go (DNA Films)

W S D R AWA Channel 4 News (ITN Ltd) Drama Series Cutting Edge – Katie: Nick Read Come Dine With Me Best Actor Never Let Me Go (DNA Films) S D R AWA Gaby Rado Memorial Award My Beautiful Face Harold Wincott (ITV Studios) Andrew Garfield Best Score Jamal Osman One Born Every Minute (Mentorn Media) Business Awards RTS Journalism Awards Best Entertainment Rachel Portman (Dragonfly Productions) Best Documentary Programme The Arbor (Artangel and UK The End of Sri Lanka’s War Factual Series Programme Dispatches – Crash! How Long Channel 4 News (ITN Ltd) Film Council) San Sebastian Film Festival (Channel 4 News / ITN) Will It Last? (Quicksilver Presenter of the Year Angela Ferreira Channel 4 Best Screenplay Television News Award Inside Nature’s Giants Misfits (Clerkenwell Films) Media) Jon Snow – Daytime Editor Clio Bernard NEDS (Blue Light) (Windfall Films Ltd) Best New Programme Business News/Current Best Entertainment Talent Golden Shell Burma VJ Specialist Factual Affairs Programme Award Channel 4 News (ITN Ltd) British Independent Film Best film (Magic Hour Films ApS) Undercover Boss The Independent Award The Bible: A History Awards Silver Shell Joint Winner Dispatches – Terror in Mumbai (All3Media International) MediaGuardian Edinburgh Baby Landina, Inigo Gilmore (Pioneer Productions) Best Actor Baby Daniel Mulloy Television Documentary and (Quicksilver Media) International Programme International Television Best TV Personality Conor McCarron Best British Short Docu-Drama Current Affairs Festival Channel 4 News (ITN Ltd) Dr Robert Beckford My Big Fat Gypsy Wedding Specialist Journalist Sundance Film Festival Channel 4 Never Let Me Go (DNA Films) Dispatches – Afghanistan’s Dirty The Inbetweeners (Firecracker Films) Gary Gibbon Angela Jain – Head of E4 Terrestrial Channel of the Best Actress Tyrannosaur (Warp Films and War (October Films) (BWark Productions Ltd) Highly Commended Outstanding Achievement Year Award Carey Mulligan Inflammable Films) Joint Winner YouTube Audience Award RTS Programme Awards Award Television Documentary and Directing Award Docu-Drama The Inbetweeners Come Dine With Me Enemies of the People Paddy Considine (Bwark Productions Ltd) (ITV Studios) Film (Old Street Films) Special Jury Prize Best Non-Terrestrial Daytime Award Best Documentary Olivia Colman and Peter Programme of the Year Academy of Science Mullan ‘Compelling, providing a unique Inside Nature’s Giants Fiction, Fantasy & Horror The Arbor (Artangel and UK Misfits (Clerkenwell Films) (Windfall Films Ltd) Films, USA Film Council) Hell and Back Again perspective – the whole team Best Network and Fast Track Science & Natural History Best New Director (Roast Beef TV) Programme The Lovely Bones Clio Barnard World Cinema was prepared to take a risk to Heston’s Feasts (Optomen) (Dreamworks Pictures) Cinematography Award: National Television Awards Features Saturn Award BFI London Film Festival Documentary deliver outstanding television’ – Best Performance Danfung Dennis The Inbetweeners (Bwark The judges of AIB Awards, The Inbetweeners by a Younger Actor The Arbor (Artangel and UK Productions Ltd) (Bwark Productions Ltd) Saoirse Ronan Film Council) United Nations Association Dispatches – Afghanistan: Behind Enemy Lines Digital Choice Award Writer Comedy Best Newcomer Film Festival BAFTA Film Awards Clio Barnard One World Media Sandford St Martin Dancing Boys of Afghanistan Media Awards Religious Broadcasting Four Lions (Warp Films) The Arbor (Artangel and UK (Clover Films) Outstanding Debut by a Film Council) UNAFF Grand Jury Award Association for Awards British Comedy Awards Grierson Awards Dispatches – Orphans British Writer, Director or Sutherland Award for the Best Documentary International of Burma’s Cyclone The Bible: A History Producer Broadcasting Awards The Inbetweeners The Force (Oxford Film and (Quicksilver Media) (Pioneer Productions) Chris Morris Armadillo (Fridthjof Film) (BWark Productions Ltd) Television) Children’s Rights Award Premier Award Grierson Award Craft Dispatches – Afghanistan: Best Situation Comedy Best Documentary Behind Enemy Lines London Critics Dispatches – Afghanistan: BAFTA Television (Clover Films) The South Bank Awards Choice Award Palm Springs International Four Lions (Warp Films) Mugabe and the White African Behind Enemy Lines Craft Awards Best Current Affairs Film Festival Best British Comedy (Arturi Films Ltd) (Clover Films) This is England ’86 Another Year Documentary The Hospital/Katie: My Performance in a Film Best Cinema Documentary Television Documentary (Warp Films) (Thin Man Films) Never Let Me Go (DNA Films) Beautiful Face (North One Kayvan Novak Award Best Television Drama British Actress of the Year Breakthrough Performance Dancing Boys of Afghanistan Productions, Mentorn Media) Endgame (Daybreak Pictures) Lesley Manville Carey Mulligan (Clover Films) Break-through talent Broadcast Awards Best Drama Documentary End of the Line TV Choice Awards Best Investigative Jessie Versluys – Director (The Fish Film Company) NEDS (Blue Light) Phoenix Film Critics Documentary E4 Race and Intelligence: Science’s Environmental Award Alan Carr: Chatty Man Young British Actor Channel of the Year Society Awards Red Riding 1974 Last Taboo (Windfall Films) (Open Mike Productions) Conor McCarron BAFTA Television Awards (Revolution Films) Best Science Documentary Last Train Home Best Entertainment Never Let Me Go (DNA Films) Our War, Their War: The Overlooked Film of the Costume Design Mo (ITV Studios) (EyeSteelFilms) Edinburgh International Afghanistan (ITN Ltd) Moving to Mars Come Dine With Me Year Natalie Ward Actress Features Documentary Award Film Festival Best News Programme (Coded Pictures) (ITV Studios) Julie Walters The Force (Oxford Film and Best Documentary on a Best Lifestyle Show Baby Daniel Mulloy Embarrassing Bodies Contemporary Issue Television) Red Riding 1974 Best British Short (Maverick Television) Glee (Twentieth Century Fox Director: Factual (Revolution Films) Best Popular Factual Television Ltd) Patrick Forbes Supporting Actress Programme Best New Drama Rebecca Hall 76 77 AWARDS 7979 (Maverick) (KEO Digital (KEO Digital (KEO Unlocking Public Health Health Public Unlocking Award Awards Ethical Observer Landshare Civic Trust Awards Trust Civic Landmark Art Big The ‘Dream’ Sculpture for Award Special Engagement Community Food of Guild Awards Writers Landshare Digital) Mint & Award Media New Engagement Healthcare Awards Strategy Bodies Embarassing Multiplatform Digital) Mint & Year the of Campaigner (E4) (4dvd) (E4 / NME) / (E4 (Film4) (Film4 / 4Creative) / (Film4 (E4 / Profero) / (E4 (Channel 4 / 4Creative) / 4 (Channel Best DVD Award DVD Best Other Insurance Brit Year the of Design Club Newspaper The Club) (Newspaper Award Graphics Best Awards Chortle Award and Gilbert Rhod Pie Mince Winning Race and Science and Race 4Creative) / 4 (Channel poster and print Best – Gold photography of use Best – Gold RIP Brother Big 4Creative) / 4 (Channel poster and print Best – Bronze 2 Season Family, The 4Creative) / 4 (Channel typography Best – Silver Season War typography Best – Bronze up Mash 4 Skins 4Creative) / (E4 design Best – Silver 80’s the Love 4Creative) / (Film4 themed Best – Silver – Restaurant Best Ramsay’s Crying and Leisure Best – Gold Lifestyle Awards Revolution Misfits Search of Use Best Commended Highly Online Revolution Awards Effectiveness Map Character Skins Networking Social of Use Best (E4) Bombs Status Skins Innovation for Award Special Radio Sony Awards Academy Show Radio Skins Content Branded of Use Best Planning TV Thinkbox Adaptations Great of Use Best Winner Content or Sponsorship (Channel 4 / 4 (Channel (E4 / 4Creative) / (E4 (generic) (E4 / 4Creative) / (E4 Night Election Alternative 4Creative) / 4 (Channel entertainment Best – Bronze originated promo: Stories True 4Creative) / 4 (More factual/news Best – Bronze promo affairs current & based clip – Continues Frightfest 4Creative) / (Film4 promo film Best – Gold music of use Best – Bronze Launch Frightfest 4Creative) / 4 (Channel people’s –The Winner 2010 choice themed Best – Bronze Season Incredibles 4Creative) / (Film4 promo film Best – Silver Season Action 4Creative) / (Film4 editor Best – Bronze sound of use Best – Bronze design (E4) ePad humour of use Best – Silver copywriter / script Best – Silver Airways E4 humour of use Best – Bronze the sponsor Sainsbury’s Games Paralympic 4Creative) credits sponsor’s Best – Silver 2010 about talking worth Films 4Creative) / (Film4 ident/branding Best – Silver device idents Christmas E4 4Creative) / (E4 ident/branding Best – Bronze device (moshpit) (moshpit) series 3 launch launch 3 series (E4 / 4Creative) / (E4 (E4) (Channel 4 / 4Creative) / 4 (Channel Creative Circle Awards Awards Circle Creative Man Chatty Carr: Alan 4Creative) / 4 (Channel or Effects Special Best – Gold Graphics Computer Commercial TV Best – Bronze Idea Best – Bronze seconds 20 in Idea Best – Bronze seconds 30 in 3 Skins Cinematography Best – Gold Direction Best – Gold Editing Best – Bronze D&AD Man Chatty Carr: Alan 4Creative) / 4 (Channel Cinema & TV – Pencil Yellow TV / Communications and Stings Promotions, Junctions Programme Awards Freesat E4 Year the of Channel – Winner Awards NMA Misfits Search of Use Best Commendation – Awards Promax 4 Channel Year the of Channel – Bronze ’86 England is This 4Creative) / 4 (Channel promo: drama Best – Gold originated Mo promo: drama Best – Bronze clip-based Inbetweeners The 4Creative) / (E4 entertainment Best – Gold originated promo: clarity of vision and the the and clarity vision of risks’ to take confidence Judge of Broadcast Digital Awards, E4 ‘A strong line-up of shows, shows, of strong line-up ‘A (Darlow (Darlow (Channel 4 / 4 (Channel (Daybreak Pictures) Pictures) (Daybreak

Chancellors The Ask 4Creative) / 4 (Channel the of Ad Newspaper Winner (March) Month BTTA Trip Road American Jamie’s 4Creative) / 4 (Channel to up and 30 Over – Diploma commercial sec 60 Man Chatty Carr: Alan Series – Diploma Awards Photo Campaign Season Adoption 4Creative) Entertainment & Media Award) (Silver Fight Food British Great 4Creative) / 4 (Channel Entertainment & Media Award) (Silver America Jamie’s 4Creative) / 4 (Channel Entertainment & Media Award) (Silver Commended Highly Lions Cannes Children Forgotten Britain’s 4Creative) / 4 (Channel Service: & Product – Finalist Media & Publications Lions Film – Finalist Marketing ANNAs PeabodyAwards Endgame Manila in Thriller Smithson Productions) Smithson PrixItalia Movie First The Films) (Connect Documentary Arts & Music African White the and Mugabe Ltd) Films (Arturi Prize Signis Tour Grand McCloud’s Kevin Productions) River (Silver the of Eyes the Through Italy Award World RoseD’Or Inbetweeners The Ltd) Productions (BWark Sitcom Best Awards (Preloaded) (O2 & (O2 (Windfall Films) (Windfall (Six to Start) to (Six (Ideonic/4iP) andDocumentary) (Clerkenwell Films) (Clerkenwell (Oil Productions) (Oil (Zone) (Zone) Dispatches Generation Taliban Pakistan’s – Ltd) Films (October Award Affairs Current Awards Emmy The (News International duPont-Columbia Afghanistan: – Dispatches Lines Enemy Behind Films) (Clover Broadcast in Excellence Journalism E4 Channel Best – Winner Marketing Live Surgery project Multiplatform Best Live Bodies Embarrassing (Maverick) Interactive of Use Best Routes Partnership Content Best Misfits Programme Scripted Best Awards Web Green ‘Landshare’ Cottage River Digital) Mint & Digital (KEO & Apps Mobile of Use Best Technologies MediaGuardian Awards Innovation Scraperwiki 4iP’s (Scraperwiki/4iP) Technology Best MirrorMe Gadgets and Application Best credit prepay Go and Load 02 campaign card 4 Channel / ZenithOptimedia Launch Best Outfit) The / Media New Awards Effectiveness 4Food Award Media Best Southwest by South Awards Interactive Smokescreen Game Best Game the 1066: resource educational Best – Series 7 Series – (Eleven Film) (Eleven (Eleven Film) (Eleven (Six to Start) to (Six BIMA Awards BIMA Curfew The Studios) (Littleloud Project Educational Best Award Special Graphics Motion – Privates Studios) Cow (Zombie Game Best Battlefront Television/Airlock) (Raw Media Social Best Misfits Multiplatform Best Club Newspaper The Club) (Newspaper Technical for Award Special Achievement Awards Digital Broadcast E4 Year the of Channel – Winner E4 Entertainment – Winner Year the of Channel Digital Media Digital Diversity Cultural Awards Network Inbetweeners Productions) (BWark Year the of Company Productions BWark Offs Cast Performance On-screen Best Wright Victoria Wedding Gypsy Fat Big My Films) (Firecracker Groundbreaking Most Programme Health Mental Mind Awards Media Shameless Pictures) (Company Award Drama Year the of People Radar Disability (Radar Awards Network) Offs Cast Award Media Fictional Naked… Good Look To How Difference A With TV) (Maverick Award Media Factual (Endemol) (Clerkenwell Films) (Clerkenwell (ITV Studios) (ITV (ITV Studios) (ITV

The IT Crowd IT The Thames) (Talkback Award Champion Attala Ash Night Good That Into Vision) (True Award Documentary Naked… Good Look to How Difference A With TV) (Maverick Award Features Factual/Reality Award Award Factual/Reality Ability Media Awards Media Ability Brother Big Diversity Maverick New Media Team Media New Maverick Innovation Craft & Design Pete Versus Life Versus Pete Productions) (Objective – Editing Film and Tape Situation and Entertainment Comedy Mo Facejacker Productions) Trick (Hat – Design Up Make and Entertainment Non-Drama – Design Costume Drama Non & Entertainment Embarrassing Bodies/ Embarrassing Live Bodies Embarrassing Interactive (Maverick Contribution) Creative Craft RTS Awards Design and Misfits Drama Sound Effects Special Drama – Design Up Make Mo 1983 Riding Red Films) (Revolution Lighting: & Photography Fiction Higgs David Director: Fiction Director: Martin Philip Fiction Editing: Hetherington Kristina Design Hair & Makeup Baker Chrissie

AWARDS 78 NG BACK C A B G IN K O O L D R WA R O F G IN K O O L

Looking back Looking forward

80 81 EDUCATIONRENEWING OUR & OLDER PURPOSE CHILDREN 8383 producers want we scenes, the Behind creative most the is 4 Channel like feel to broadcasting. British in work to place range widest the support to want We than risks more take possible, talent of the suppliers our give and else anyone create opportunityto and freedom anything to different is that content air. on else , we will aim to strengthen to aim will we , our relationship with the 16-34 year old old year 16-34 the with relationship our remain they ensure and audience that content service public with connected This educational. entertainingand both is investing continue to us enable will turn in to appeal to designed programmes in audiences. wider As a public service broadcaster we are we broadcaster service public a As tastes and the to catering to committed Post- people. of range wide a interestsof Big Brother The viewing experience will begin to see see to begin will experience viewing The split with 2011, in change considerable content,apps non-linear viewing, screen our around conversation social and increasingly becoming programming respond to seek will 4 Channel popular. finding – changes these shape help and to and audiences with interact to ways new them. with relationship our strengthen digital all on innovate to continue will We online our refocus will and platforms, linked tightly more is it strategyensure to ambitions. editorial overall 4’s Channel to rigorous more be to seek also will We impact. assessing and defining in

2010 saw small declines in performance performance in declines small saw 2010 covering statements againstreputational seek will remit. We our aspects of various our through declines these reverse to focus greater a With renewal. creative 2011 experimentation, and innovation on seek we as revitalised schedule the see will that ideas of generation next the find to forward. going 4 Channel define can be will risk-taking of culture a Promoting crucially, – ambitions these to paramount fail. to afraid be not must we and a new, integrated creative team team creative integrated new, a and

our purpose our

Renewing

Channel 4 is renowned for commissioning commissioning for renowned is 4 Channel point key a is it – content provocative other to relative distinctiveness of significant made broadcasters.Having output, we 2010 our of much with impact role, cultural vital this evolve to seek will stronger even an has that content with can which and resonance contemporary Britain. modern about debate provoke drama affairs,factual, current Across strengthen to seek will we comedy and challenges that content for reputation our reflects and change inspires orthodoxies, communities. and cultures diverse values and creative ambitions. ambitions. creative and values extraordinary opportunity to redefine Channel 4’s 4’s extraordinary Channel redefine opportunity to for the first time. This provides us us with an first the provides This time. for commissioning online and television combining Big Brother Big without decade a over in withfirstthe schedule 2011 is set to be a landmark year for Channel 4, 4, Channel for year landmark a be to set is 2011

RENEWING OUR PURPOSE 8282 EDUCATIONInvesting I&n COLDERreativity CHILDREN 8585 More4’s budget will be held constant in in constant held be will budget More4’s broadly itsremain strategy will While 2011. opportunities viewers offering – similar popular most the of some with up catch to brand- some alongside shows 4 Channel seek also will we – commissions defining impact overall the increase to ways channel. the of will channel Film4 the for budget The aim will channel The slightly. decrease successful a after itsshare maintain to mix similar broadly a offer will and 2010 films. alternative and mainstream of multi-platform including spend, online Our our and education commissioning, stay However, will flat. sites specialist department Online integrated newly the to focus editorial clearer a have will 4’s Channel complements it ensure effectively. more ambitions creative all ensuring strategy involves new The following the to contribute commissions overall increasing objectives: of set programming; television of consumption value public or financial generating relationships deepening 4; Channel for future developing and audiences; with accelerate To formats. ‘convergent’ new a launch will we lastobjective this £2million worth Fund Formats Convergent creative and ideas,apps in invest to such platforms converged for concepts YouView. service IPTV the as later Friends and 2010 in Big Brother in the year. However it will have a larger larger a have will it However year. the in we and titles, new on spend to budget the remains it ensure will this hope old year 16-34 the for choice of channel maintain to seek will We demographic. and creative for reputation E4’s range a with success, commercial entertainment,and comedy new of alongside sitting commissions drama acquisitions. US quality high Breakdown by platform platform by Breakdown mixed a deliver to continue will We service, 4 Channel main the on schedule content original and compelling with significant a be will There genres. across new of numbers the in increase focus greater a with but commissions, titles ‘one-off’ than rather series on achieving difficultyin oftenhave (which partas audiences) to cut-through popular more strategy a develop to of achieve can that brands programming resonance. brand long-term overall reduced slightly a have will E4 end the following spend programming of world will will world Drama NewsCurrent & Affairs Factual ComedyEntertainment & Other Online Wherethe money isspent Big Brother BigBrother Acquisitions CreativeRenewal Commissioning Priorities performance the improve further and already perform strongly. While the reality the While strongly. perform already mean 2011 will be a challenging year for for year challenging a be will 2011 mean creative renewal will enable us to maintain maintain to us enable will renewal creative channels. digital the of 2010 and maintain it in genres where we we where genres in it maintain and 2010 post- a in life of Channel 4, we also hope this period of of period this hope also we 4, Channel Wherethe money issaved the main channel’s overall viewing share share viewing overall channel’s main the to strengthen our reputation in areas in reputation our strengthen to where audience perception weakened in in weakened perception audience where This increased investment will enable us enable will investment increased This Big – creating a significant increase significant a creating – and we will continue to review market market review to continue will we and continue which market, advertising advertising market. The total content content total The market. advertising and documentaries. The production and and production The documentaries. and across our key genre areas, with genre key our across comedy, for increases significant in 2011, based on forecasts for the the for forecasts on based 2011, in in the resources available to spend on new new on spend to available resources the in plans accordingly. plans 2011’s budget will reallocate the money money the reallocate will budget 2011’s balances our public service remit with our our with remit service public our balances the from revenue generate to need stayflat to forecast broadly is budget be increased to £15 million a year. year. a million £15 to increased be commitments are phased across the year, year, the across phased are commitments also will Film4 for budget development entertainment, affairs,drama current investment our adapt and forecasts Brother that has previously been spent on on spent been previously has that to be uncertain. Content investment investment uncertain.Content be to titles. This investment will be targeted be will investment This titles. to invest in dozens of new projects across our portfolio. our across projects new of in dozens invest to titles retired from released is million £100 approximately as 2011 will bring Channel 4’s most diverse schedule for years, for schedule diverse most will bring 4’s Channel 2011 We have set a prudent content budget that that budget content prudent a set have We Total content budget budget content Total

In C reativity

Investing 84 We are significantly increasing our investment in film production to £15 million a year, enabling Film4 to Film & Drama strengthen its role at the heart of the UK’s independent film industry. 2011 sees a strong season of cinematic releases that showcase the best of British film-making talent – with Danny Boyle’s visually arresting 127 Hours, the historical With its ability to deliver brand-defining returnable series epic Eagle from Kevin MacDonald, and a chilling adaptation that can deliver significant impact, drama will be a major of Never Let Me Go, in which Mark Romanek directs a cast Creative recipient of the reallocated content budget. of brilliant young British talent. Peter Mullan returns to Channel 4 with his Glasgow-based NEDS and Ben Wheatley A focus will be on developing potentially long-running will premiere his second feature at South by South West. The comedy dramas that bring a more youthful and entertaining year will also see the release of several films from female tone to the schedule; Fresh Meat will follow the lives of six directors, including Andrea Arnold’s Wuthering Heights, university freshers sharing a house in Manchester, Naked Lone Scherfig’sOne Day and Phyllida Lloyd’s Iron Lady.

TIVE V I AT E R C Apes will take a comic look at modern relationships from the E V I AT E R C ambitions jaded perspective of paramedics in Leeds and Beaver Falls, We will continue to work closely with commissioners across a new series for E4, will follow three British students Channel 4 to find and nurture new film-makers – with working at a US summer camp. several debut films from people who have built their

careers with Channel 4. These include comedians Joe BITIONS N O I T I MB A S N O I T I MB A We will continue to show challenging drama that explores Cornish, Richard Ayoade, The Inbetweeners writers Damon contemporary social issues. In addition to Debbie Tucker Beesley and Iain Morris, actor Paddy Considine and Green’s hard-hitting Random, this includes a new thriller producer Bart Layton. We will also be developing and series, Top Boy, about gang members in East London and producing new films from original Channel 4 talent such Peter Kosminsky’s serial The Promise, exploring the modern as Chris Morris and Steve McQueen. day Israel-Palestine conflict through the prism of history. We have also commissioned Shane Meadows to build on the We will experiment with new ways of reaching audiences huge success of This Is England ’86 with a further instalment using new technologies and distribution models, and will set two years on. continue to show a diverse range of British and international films on the Film4 channel. Alongside these new titles, we will review and refresh our longer-running series to ensure they remain relevant to audiences, as well as acquiring more high-quality dramas from the US and developing innovative ways of enhancing stories with interactive media. This will include exclusive online content for fans in between series as well as encouraging online discussion around popular shows.

Commissioning values

Experimentation will be at the heart of the 2011 schedule. We will be more open than ever to new and diverse voices. In an age of ever-increasing choice, we want to be the home Therefore 2011 will see the launch of the Alpha Fund, for creative risk-taking – uncovering new and distinctive a £2 million annual development fund devoted to supporting voices, questioning the consensus, exploring new ideas and grassroots creativity across television, film and digital Comedy & Entertainment expanding the diversity of our supply base. This means media. We will increase new and regional companies’ access investing significantly in new companies, pilot projects and to commissioners, helping us achieve our aim of working creative development, launching new formats and titles in with a more diverse supply base. We will run targeted all genres and developing new ways of engaging audiences. schemes aimed at giving new entrants their first break Our aim in 2011 is to strengthen our reputation for Entertainment will see a major period of experimentation, Not all of these experiments will work, and only a few can be in the industry, as well as funding industry training distinctive comedy. Our investment in this genre has as we develop Channel 4’s role post Big Brother. Our goal expected to become successful long-running brands. But organisations and running on-screen strands and series doubled since 2009, enabling us to significantly increase the is to refresh and grow our entertainment slate on Friday greater flexibility in the schedule provides us with a hugely that provide a platform to new writers and directors (such volume and range of comedy output. In 2010 this will include nights, as well as investing in younger-skewing shows for important opportunity to test out new ideas, and we intend as the forthcoming drama Fresh Meat, in which Peep Show ’s sitcoms, satire, sketch, stand-up, panel and prank shows. the 10pm slot. We will also try new formats, particularly to make the most of it. Jesse Armstrong and Sam Bain will lead a team of young in late night slots. writers). Black playwright Debbie Tucker Green will make Our ambitions are symbolised by our acquisition of the Across the schedule we will aim to be the home for people her TV directorial debut with a hard-hitting drama based British Comedy Awards, which we will re-launch in January The scale, appeal and playfulness of entertainment and ideas that are not normally found in mainstream media. on her stage play Random – continuing Channel 4’s as an exciting Channel 4 brand. We will offer new sitcoms programmes makes the genre a particularly ripe area Major series such as Big Fat Gypsy Weddings will uncover relationship with both Tucker Green and producers HillBilly for both Channel 4 and E4 alongside returning series such for audience interaction. Building on the success of Million the values of little-known communities, reflecting the Films, who first worked together as writers and producers as The IT Crowd, PhoneShop, Facejacker and Pete Versus Pound Drop, we will continue to integrate television and diversity of life across the UK. 2010 saw a slight drop in on the 2007 Coming Up strand. Life. New commissions will include Friday Night Dinner, online ideas to provide viewers with compelling two-screen audience perception of our coverage of ethnic minorities, Campus from Green Wing creator Victoria Pile and Noel formats. This will be a particular focus as we invest in more gays and lesbians and disabled people, and so we will seek Fielding’s debut solo show Luxury Comedy. live shows, in which the online conversations and to strengthen our reputation in these areas. This will interactions that take place during transmission include shows such as Katie’s Beautiful Friends and Beauty We will continue to identify new comic voices, from the become part of the show itself. and the Beast, which challenge perceptions of those with biannual Comedy Showcase season to Show and Tell facial disfigurements, and a season of documentaries about featuring three up-and-coming comedians every week, the Paralympic athletes which will increase awareness as well as experimenting with ways of using online media and understanding of disability sport as we lead up to 2012. as a forum to test out new voices. We will also encourage Series such as Top Boy will continue our commitment existing talents to take risks and try out new opportunities to telling stories from the diverse cultures of contemporary – with David Mitchell, Charlie Brooker, Jimmy Carr and Britain, and The Joy of Teen Sex will be a bold look at Lauren Laverne moving into political satire in 10 O’Clock sexuality in all its different forms. We have also made Live and new sitcom Chickens starring Simon Bird and a commitment to improve our engagement with the Joe Thomas from The Inbetweeners. transgender community, with activity on and off screen. 86 87 Factual

We will try to increase the popularity and relevance of factual content with an increased focus on contemporary themes. We will aim to maintain our already strong reputation for being provocative and distinctive, and develop new series that can resonate with and inspire audiences. Building on the success of projects such as Embarrassing Bodies we will develop new online formats, but with a tighter focus on areas where multiplatform TIVE V I AT E R C E V I AT E R C support can clearly add value.

In documentary we will continue to use fixed-rig cameras to reveal intimate insights into modern life; against a backdrop

BITIONS N O I T I MB A of major Government cuts, 24 Hours in A&E and Nurses will Audience Engagement S N O I T I MB A reveal stories from the front-line of the NHS. Murder Trial will provide unprecedented access to the Scottish courts. We will also commission projects that appeal to a younger demographic, with Classmates following the lives of a group Social media and converged technology have created a of 16 year olds. transformational opportunity for broadcasting, enabling News & Current Affairs us to have a more in-depth insight into the behaviour We will bring a dynamic and distinctive approach to Education & Older Children and tastes of our viewers. traditional subjects such as history, religion and science, highlighting themes with contemporary resonance. There In 2011, we will explore new ways to engage with and use this will be a greater emphasis on science and technology, as We will continue to pursue high-quality, fearless journalism data – helping us to both enhance viewer experiences and Channel 4 commissions educational content across well as historical series that inform our understanding in news and current affairs – holding power to account, develop new business models. A new Director of Audience numerous genres and slots, whether it is taking a new of the modern day – such as Niall Ferguson’s Civilization: provoking debate and covering subjects other broadcasters Technologies and Insight will be responsible for approach to science, informing viewers about life Is The West History? The unique legacy of our projects will would not. Our aim in 2011 will be to increase the appeal and transforming the way Channel 4 collates information in Roman Britain or inspiring them to try new recipes. be an important theme – with a new series of Inside relevance of our content, while maintaining our high on viewer behaviour and opinion, and identifying how Nature’s Giants and Rome Wasn’t Built In A Day standards and values. this insight can inform new commercial and Across the schedule, we will promote ‘life-long learning’ reconstructing an authentic Roman villa using ancient tools creative opportunities. for all age-groups with content that is both engaging and techniques. Made in partnership with English Heritage, 2011 will see a reshaping of the Channel 4 News format, and distinctive, by balancing a portfolio of educational the series will create an exciting educational resource that with the introduction of a third presenter, new science, This role will lead the creation of a new integrated database, commissions that includes television, the web and games. visitors will be able to explore for generations. environment and social affairs reporters and which will help collate all the insight and analysis needed to improvements to the navigation and structure drive Channel 4 into the next decade. Our ambition is to be For 14-19 year olds, a major focus in 2011 will be ethics, social A new dedicated arts commissioner will work across of the programme. the best informed broadcaster in the business – as the responsibility and life-skills – with key themes including television and interactive media for the first time. better we know our viewers, the better we can serve them. financial literacy, sexual and mental health, the 2011 will see an updated and refreshed arts slate focused While the online budget will fall slightly following 2010’s We will use the knowledge we collect to make it easier, environment and ethical fashion. We will continue to provide on reflecting Britain’s dynamic contemporary arts scene, upgrade to the Channel 4 News website, using digital cheaper and more convenient for viewers to watch the the tools and support for young people to learn skills that including a unique season on Street Art. This will celebrate media to connect with audiences in new ways will remain programmes they love. are not necessarily part of their curricular studies, with the arts of contemporary urban Britain, with programmes a priority. This will include harnessing social media to enable Battlefront continuing to provide young people with the on hip-hop, street dance, graffiti and spoken word poetry. viewers to shape and participate in the news agenda more support to lead their own campaigns, around subjects Stripped across 10 days, there will also be a strong directly and developing applications for converged devices as diverse as autism, knife crime and cyber bullying. multiplatform element to the season, using social media such as the iPad. to invite viewer contributions as well as exclusive online We will also explore ways of using our key brands in the linear schedule to drive engagement online. content on channel4.com. We will aim to increase the impact of our key current affairs strands. Dispatches will continue to tackle daring and The Education team will respond to our new remit We will aim to stay ahead of the curve in terms of reflecting provocative stories about Britain and the wider world, with to develop bespoke projects for older children. We will invest social trends and consumer interests – interrogating bold a greater focus on investigative journalism. We will also seek an additional £1 million in new projects tailored specifically new themes as well as bringing new twists to food, property to increase the profile of international strandUnreported to the interests and behaviours of this audience, including and beauty. We will also look to further strengthen our World, and experiment with ways of using social media several projects aimed at 10-14 year old girls. reputation for content that inspires audiences with to connect the strand with younger audiences. programmes that have a campaigning focus. Jamie Oliver will tackle schools policy in Jamie’s Dream School, in which We will experiment with new types of current affairs some of Britain’s best known experts will be brought in to programming. 10 O’Clock Live, a co-commission teach under-achieving young people and encourage them with comedy and entertainment, will see comedians to give education another chance. The Big Fish Fight season interrogating the main political issues of the day. will bring Channel 4’s top chefs together to champion sustainable seafood and Mary Portas will challenge high street stores to prioritise customer services in Secret Shopper. Expert presenters that audiences trust and are inspired by will remain at the heart of our factual entertainment programming, with new faces such as Katie Piper joining the team.

88 89 FINANCIAL REPORT AND STATEMENTS 91 statements report and and report Financial Financial assessingrelevant supporting documentation used to aggregateand report the measures; key assessingthe significant assumptions and judgements made Channel by in the4 preparation ofthe charts; key testingthe documentation which supports the measurement, calculationand estimation ofthe charts; key assessingand testing the source information used togenerate the charts; key and testingthe operating effectiveness ofsystems and controls;

- - - Examiningthe presentation charts ofkey and the calculation ofyear-on-year trends in Channel Report 4’s in light ofour findings. Conductinginterviews with management and other personnel Channelat to obtain4 an understanding ofthe external informationused and the level ofinformation available tosupport the measures; Assessingthe accuracy ofextraction from external information sourcesand the compilation oftrends for the medium-term viewingmeasure; and calculation the measuresand key presentationof the Examining findings. our of light in Report 4’s Channel in trends year-on-year of Assessingthe accuracy ofthe calculation performed within Channel4; and Examiningthe presentation measures ofkey and the calculation ofyear-on-year trends in Channel Report 4’s in light ofour findings. Channelmeasures key 4 for the year ended 31December 2010 andthe comparison with the immediate prior year are not fairlystated; measures, key where the source ofthe data is Ofcom orBroadcast, for the year ended 31December 2009 and the comparisonwith the immediate prior year are not fairly stated; themedium-term viewing trends measure key for the period 2005to 2010, and the TV viewing share from 2006 to 2010 are notfairly stated. – Conductinginterviews with management and other personnel Channelat to obtain4 an understanding ofthe systems and controlsused generate,to aggregate andreport charts; thekey Examiningand testing ofthe systems and processes in place togenerate, aggregate and report charts; key Assessingthe completeness and accuracy ofthe charts key by: –

– Forthe measures key calculated based on information from outside ofChannel (stated 4 as Source: BARB, Ipsos MORI, Attentional, Ofcom andBroadcast) relied have we upon the information supplied by BARB,Ipsos MORI, Attentional, Ofcom and Broadcast and not have carriedout any independent verification procedures on the informationso provided to Channel other 4 than: – – – 3rd online 4’s Channel from information on based measures key the For of: consisted work the above, outlined providers service data party – – Matterofemphasis Ourconclusions do not relate to the periods before 2008, other than asindicated above in the Scope ofwork. Conclusions Basedon the work performed, nothing has come to our attention tosuggest that: – – – HughGreen for and on behalf ofKPMG LLP CharteredAccountants UnitedKingdom 30March 2011

Basisofour work conducted We our work in accordance with International Standard onAssurance Engagements 3000: Assurance Engagements other thanAudits or Reviews ofHistorical Information, issued the by InternationalAuditing and Assurance Standards Board. made We use ofChannel Statement 4’s ofMedia Content Policy Methodologyto perform our work. Workperformed measures thekey For thatare calculated from information derived within Channel (stated asSource:4 Channel theworkconsisted 4), of: – – –

wherethe summary metrics for which the source ofthe data isOfcom or Broadcast for which the 2010 data was not yet available,examined have we the information for the years ended31December 2009 and 2008 found on page 18; checked have we the extraction ofTV viewing share from from BARB 2006 to 2010 found on page 70; and checked have we the calculations compiled to report the medium-termviewing trend measures key between 2005 and2010 found on page 71 . Mostsubmitted comments on channel4.com and e4.com page (on 73); Channelprogrammes 4 with the highest conversion rate fromTV audience to website visits page (on 73); Conversionrate from TV audience to website visits in the comedyand entertainment genre compared to all Channel 4 programmes,page (on % 51) Averagemonthly number full length programmes views initiated (on page (on 72); Averagemonthly visits to Channel websites 4’s page (on 73); Averagemonthly page viewspage (on 73); Numbervisitors ofUK to education projects online page (on 65); and Averagetime spent on Channel education 4’s sites visitors UK by page (on 65).

Independentassurance report to ChannelFour Television Corporation (Channel 4) Channelengaged 4 KPMG(UK) LLP to provide limited assurance over theircharts key on pages 10,9, 11, 14, 15, 18, 19, 20, 21, 22, 23, 24, 33, 41, 42,51,59, 65,70, 71,67, 72, 73of their and 74 Statement ofMedia ContentPolicy identified hereafter as ‘the key charts’. Thisindependent assurance report is made solely to Channel 4. Our workhas been undertaken so that might we state toChannel those 4 mattersthat been have we engaged to state in this report and for noother purpose. the fullest To extent permitted do notwe law, by acceptor assume any responsibility to anyone other than Channel 4 forour work, this independent assurance report, or for the conclusionsreached. have we Responsibilitiesofthe Channel Members 4 TheMembers ofChannel are 4 responsible for the preparation ofthe StatementofMedia Content Policy Methodology, the 2010 Annual Reportand determining the content and statements contained therein,and for establishing and maintaining appropriate performancemanagement and internal control systems from which thereported information is derived. Channelapplies 4 its own Statement ofMedia Content Policy Methodologyfor reporting. The statement on the Channel website 4 andthe detail within the Statement ofMedia Content Policy section givesfurther information on how the data has been selected, specific definitions and the calculation methodology. (www.channel4.com/annualreport) Responsibilitiesofthe independent assurance provider Ourresponsibility is to express our conclusions to Channel 4 onthe findings of our work referred to below, and examineto the presentationofthe measures key in the Statement ofMedia Content Policysection ofthis report for consistency with our findings. Scopeofwork examined We the measures key in the data tables, graphs and pie chartsrelating to Channel in this4 2010 Annual Report and the year-on-yeartrends, as defined in the Statement Mediaof Content PolicyMethodology. Theprimary focus ofour work was measures for the year ended 31 December2010 and the comparisons with the immediate prior year. not have examined We the measures key for years prior to the year ended31December 2008 other than in the following cases: – – – Forthe following measures, key the scope ofour work was limited tochecking the calculations performed the by Managers of Channelbased 4 on the data provided its by online 3rd party dataservice providers: – – – – Corporation (Channel 4) (Channel Corporation to Channel Four Television Television Four Channel to report assurance Independent – – – –

ASSURANCE REPORT 90 FINANCIAL REPORT AND STATEMENTS 93

include data on the volume and value of programming by genre, genre, by of programming and value on the volume include data of indicators and other results, of audience research a range performance. on- and off-screen on the work builds of the measures In 2010 the presentation the key around It is structured years. two done in the previous operating our across remit fulfil the which we through genres enhanced regulatory our segments and incorporates 2010 to Act under the Digital Economy Ofcom to obligations demonstrating Policy of Media Content publish a Statement and setting activities all of our across remit fulfilment of our strategy. out our future the monitor used to performance indicators The key set out below. performance of our business are commercial of financial and non-financial measures use a combination We our been in achieving have successful we assess how to are: These measures objectives. 1. Channel 4 audience share portfolio audience share the group’s In the period 2005-2010, In 2010, broadcaster. terrestrial other than any held up better the showing 11.5%), (2009: 11.4% was portfolio audience share of the digital channels strategy on our total effects mitigating share. viewing the is remit our on delivering are we how of measure key A in measure we which programming, 4’s Channel core of impact share channel’s core the 2010, In audience. of share our of terms another in S4C) excluding % 7.4 (2009: 7.0% was audience of audiences lost channels terrestrial main the of all which in year switchover. digital of result a as television multi-channel to 2. Digital channel audience share the viewing eroding television of multi-channel With the growth public service channel, our portfolio of digital of our core share a wider to content 4-branded deliver us to channels allows In 2010 our streams. revenue new audience and generate points 0.3% by of viewing their share digital channels grew (2009: 4.1%). 4.4% points) to (2009: 0.4% 3. Ofcom requirements 4 is Channel set various core a public service broadcaster, As the delivery of which is central Ofcom, by licence obligations of a range set for are Targets our public serviceto role. set are targets These measures. and transmission production all our met or exceeded In 2010 and 2009 we 155. out on page licence requirements. hours of overall 58% achieved channel core the 2010 During hours peak 77%in and 56%) (target: programmes originated of of 35% of target our exceeded also We 70%). (target: million) (£117.5 39% with London outside production programme being News the excluding programming originated 4’s Channel of M25. the outside located companies production by supplied revenue advertising television 4. Total without activities commercial Channel 4 is funded solely from from derives the group revenue The subsidy. public direct financial performance overall advertising drives television Our commercial and enables the delivery of our remit. airtime valuable performance to is dependent on delivering of (2009: 85%) 85% for which in 2010 accounted advertisers, revenue. total people at the beginning of their careers in relevant in relevant the beginning of their careers people at or films, and media content content in the making of innovative people involved and films; demonstrates innovation, experiment and creativity in the and creativity experiment innovation, demonstrates of programmes; and content form diverse of a culturally and interests the tastes appeals to society; for the meeting the need to a significant contribution makes of an include programmes licensed public channel to of educative programmes and other nature educational and value; character’. a distinctive exhibits talent, of people with creative ‘support the development in particular (i) (ii) support and stimulate well-informed debate on a wide debate support well-informed and stimulate to access providing of issues, by including range and by the world around from and views information challenging established views; and perspectives; and new voices alternative promote inspire to is that intended material to access provide changes in their lives’. make people to the members of Report continued performance Key indicators only Corporation’s Channel 4, the The primary purpose of core as a public service Ofcom is channel, the channel licensed by remit as defined in the servicefulfilment of its public ‘the that states public The Act 2003. Act Communications of range a broad of Channel 4 is the provision for service remit which, in particular: programming high quality and diverse — — — — Act the Communications subject to Channel 4 remains Core which specific public service and is the only channel to 2003 as a condition of our public service broadcasting obligations Channel 4 2010, Act Under the Digital Economy licence apply. must all our activities, as a whole, across — — — — Channel 4 must further in the making of relevant participate of older and interests the tastes appeals to that media content or distribution of the broadcasting adults, young and children Kingdom activity in the United reflect cultural films that feature or party(including third films), and the broadcasting of means of a range by media content distribution of relevant networks. communications of electronic types different a the Channel 4 Annual Report presented In 2008 and 2009, Channel 4 that the public value measure to framework new as a to operate ambitions Channel 4’s reflecting provides, Channel 4, the digital core covering public service network, channels and online services. In 2010 these public value The measures year. a third been published for have measures

E4 – focusing on comedy, drama and entertainment entertainment and drama comedy, on focusing – E4 further and acquisitions US commissions, original including digital leading the is E4 output. 4 Channel see to opportunities channel digital popular most third the and 16-34s for channel definition high new a on available been also has E4 UK. the in Virgin on and 2009, December since Sky on E4HD, service, E4+1 on available also is and 2010, April since commissions, of new – offering a combination More4 channel the core from and programmes acquisitions affairs, current including news, multiple genres, across entertainment factual, drama, and documentary film channel, which dedicated leading Film4 – the UK’s US and mix of the best British, a European, offers in high has also been available cinema. Film4 international since July 2010 platform definition on the Virgin of Channel4.com and E4.com – which host a variety as as well content complementing television micro-sites the video on demand for advertising-funded catch-up free, than any content archive and more shows majority of key UK broadcaster other and enhancing commissioning exploiting platform Cross online distribution channels across content deals with online content Video on demand syndication such as YouTube aggregators

Principal activities Principal segments: operating Our business comprises five Channel 4 analogue, digital on The public service channel is available and continues to platforms and cable satellite terrestrial, creativity of innovation, on the values focus maintain its core transmission our delayed It also encompasses and diversity. service, and high definition C4 HD. service C4+1 4Channels digital channels, which free-to-air 4Channels comprises three in impact scale and creative maintain the Corporation’s help to The digital channels build on the core the multichannel world. further of Channel 4 and offer values opportunities see to as originally commissioned and as well Channel 4 programming The channels are: programming. specially acquired — — — 4Rights 4Rights includes our UK secondary rights business generating sale of DVDs, the distribution of programmes, income through products. associated and other Media Future the help extend to platforms Channel 4 has used interactive than a more output for of its programming depth and impact technologies and new the internet use and continues to decade its opportunities commercial new and reinforce develop to public service contribution. These include: — — — Other design and production of creative Other includes the provision services. lling public service obligations as set out in the 1990 1990 the in out set as obligations service public lling fi

The group’s financial statements are set out on pages 104 to 140. to 104 pages on out set are statements financial group’s The A review of the group, outlining its development and outlining its development of the group, A review together with its position performanceyear during the financial on the in the business review is provided December 2010, 31 at and risks This also outlines the principal pages. following uncertainties Channel 4. facing The Chairman and Chief Executive present their statements their statements present Executive The Chairman and Chief respectively. 4-5 and 6-7 on pages Channel 4 welcomes the Digital Economy Act 2010, which which 2010, Act Economy Digital the welcomes 4 Channel talent, nurture to remit the into purposes four incorporates change, inspire and debate stimulate views, alternative provide Digital Film, – areas new three into remit our extends and ability our reflecting – Children Older for Content and Content channels television of portfolio our across value public deliver to channel. service public core the to addition in media digital and analogue and the main on both 4 is Channel available Core Freeview, and in high definition on platforms, digital broadcast on digital platforms, as being available well As Sky and Virgin. and Film4 HD on Virgin. Virgin, on Sky and E4 HD is available available is made programming including archive Our content is on the 4oD service content on channel4.com, and selected and devices a number of digital platforms to also syndicated SeeSaw YouTube, Talk, Vision, Talk Media, BT including Virgin in participate continued to 3. In 2010 we PlayStation and Sony the internet Canvas), Project (formerly project the YouView a programme which will offer viewers box, set top connected also launched Film in time. We back days goes seven guide that In our Film 4 content. for a partnership with Film Flex, 4oD, further the our reach to extend to advanced plans are addition, platform. Freesat Channel 4 is a public service broadcaster funded solely from from solely funded broadcaster service public a is 4 Channel in spectrum free receives 4 Channel revenues. commercial ful for return Communications the by amended as Acts Broadcasting 1996 and by issued licence the and 2010 Act Economy Digital the 2003, Act group The 2004. December 28 on effect into came which Ofcom, are which activities commercial various pursue to continues also 4. Channel of operation the to conducive Channel 4 is a unique organisation: a public service broadcaster broadcaster service public a organisation: unique a is 4 Channel marketplace, the within funded remit, creative distinctive a with and challenging distinctive, of range a provide to existing – remit service public our fulfil to order In content. provocative tastes the to appeal and television in experiment and innovate to optimising whilst – society diverse culturally a of interests and core strong a on focus to continue we returns, commercial online. and channels digital our alongside 4 Channel business review business 4) is (Channel a statutory Corporation Television Channel Four established under the without shareholders, corporation, 1990. Act of the Broadcasting terms Introduction and and Introduction

the members the financial report their and the audited present The members December 2010. ended 31 the year for statements Report of Report

FINANCIAL REPORT AND STATEMENTS 92 FINANCIAL REPORT AND STATEMENTS 95 Financial position Financial 106 of the financial statements sheet on page The balance as in the year increased the net assets of the group that shows million, partly offset surplus of £49.3 the operating of a result 6). (note the year for tax charge the corporation by 4Rights £44.8 million in 2009 million from £3.0 by increased Revenues sales in rights This included an increase million in 2010. £47.8 to deals and other output secondary programme from generated in consumer collections, and an increase partythird share sales), which reflected DVD (principally revenues products despite share in market titles and growth the success of key 4Rights generated market. DVD overall a slight decline in the million in 2010 (2009: £11.5 million) £7.4 of profits operating of nature hits driven and the on margins the pressure reflecting of the carrying value in a review the business, which resulted and of certain development and subsequent write-down advances. producer Media Future representing 2010, in million £44.3 were revenues Media Future the mainly is increase The million). (£33.1 2009 on 34% of growth deals syndication new and 4oD on inventory increased of result million £3.8 was loss operating The SeeSaw. and YouTube with platform cross include to restating after loss million £2.3 (2009: after media), service public digital in investments 4iP and 2010. in commissioning platform cross into investment greater single a under activities online all of combination the follows This 2010. in team commissioning multi-platform Other design and production included creative Other revenues was revenues services. A significant proportion of these consolidation. on group eliminated costs Finance with million in 2010 compared was £1.8 Net finance income was The increase million net finance costs in 2009. £2.0 of discounts on the unwinding the reversal due to principally of provisions. on short deposits in 2010 was term receivable Net interest in cash and the increase in 2009 despite than slightly lower due 5 and 15). This was (notes during the year cash equivalents contracted rates favourable more deposits at some term to during 2009. during 2008 and expiring

Operating revenue (loss)

Other Total profit/

— 47.8 — — 47.8 5.9 (9.0) 7.4 (9.0) 5.9 (0.6) — — 44.8 — — 44.8 6.1 (10.1) 11.5 (10.1) 6.1 — 0.6 TV £m £m £m £m 170.7 10.6 181.3 53.5 193.9 10.7 204.6 54.0 535.1 40.0 575.1 (59.4) 706.7 123.6 830.3 3.9 794.2 141.0 935.2 49.3 598.5 43.1 641.6 (7.7) revenue revenue advertising * 1.8 42.5 44.3 (3.8) * 0.9 32.2 33.1 (2.3) the members of Report continued performance Financial 12.6% by increased our revenues below, in the table shown As was profit Our operating 2009 (2009: decline of 8.5%). from million (2009: £3.9 million). £49.3 Channel 4 2010, in million £641.6 to million £66.5 by increased Revenues 14.7% of market advertising the in recovery the by mostly driven conditions, market in improvement the Given year. the during and programming into funds additional reinvest to able were we and performance impact commercial our support to marketing of launch the in invested also We sales. advertising years’ future operating channel core resulting The Freeview. on HD 4 Channel million). £59.4 (2009: million £7.7 was loss 4Channels £181.3 million from million £23.3 by on year year grew Revenues recovery the market by driven million in 2010, £204.6 in 2009 to 4Channels generated in audience share. and underlying growth million), million in 2010 (2009: £53.5 of £54.0 profits operating reinvested growth of advertising revenue as a result principally and higher distribution costs as content programme into back digital services expand. Channel 4 4Channels 4Rights Future Media Other Eliminations 2009 Channel 4 4Channels 4Rights Future Media Other Eliminations include the costs to restated Media are Future for 2009 results and 4iP activities. platform of cross 2010

* In March 2010, Channel 4 HD launched on Freeview HD, a HD, on Freeview 4 HD launched Channel 2010, In March channels using HD service offers television that free-to-air box. a set top Channel 4 as Chief joined Abraham David 2010, In May and team the executive arrival, David’s Following Executive. a to leading restructured were senior management group All content of the senior team. in the size reduction together brought and online – was commissioning – television was team ad sales Officer; the Creative under a single Chief all platforms; clients across sales to deliver to restructured into together also brought were communications and marketing Audiences, of the Director post, and a new a single team; our and lead develop to created and Insight, was Technology management using technology and relationship viewer plans for analytical UK’s with the ambition of making Channel 4 the tools, broadcaster. most viewer-centric a shareholding into Channel 4 entered 2010, In September parties 125) to with a number of other (see page agreement for responsible the company TV Ltd, in YouView shares acquire for provides The agreement platform. the YouView developing in the an equal share hold to shareholders of the seven each set launch its internet-connected to which expects company, in 2012. box top the following that announced 4 Channel 2010, October In pilot the – 4iP team, commissioning content its of restructure longer no would – talent digital emerging nurturing for scheme ideas media digital new All proposals. and submissions new seek team. commissioning multi-platform the by developed be will its advertising sales January 2011, Channel 4 expanded From the joint venture UKTV, for include representation portfolio to Media. and Virgin Worldwide BBC between in 2011 continues in an uncertain advertising market. Trading budget to set a prudent and phased have we Once again manage the uncertainties and beyond. sector television in the of our public meet the requirements to The 2011 budget seeks Channel 4 in core invest continuing to through service remit the decommissioning of Big Brother following renewal creative of our organisation transformation for the way and prepares convergence. meet the challenges of technological to to in place plans are phased, and alternate Commitments are risk and balance seek to we manage budgetary risk. Overall, in maximise our investment opportunity continue to to in order sustain the long term to Channel 4 share and core content surplus. a pre-tax whilst targeting viability of the organisation, 2009 slightly above rose the year for headcount Average service (2009: 696), mainly to our advertising 727 at levels the online sales expand Box, deal for sales representation 4). (note and insight capability and build research team (2009: 694). 731 was the year for Closing headcount with compared rise to expected is 2011 in headcount Average revenue- on focused principally is headcount New 2010. representation), advertising UKTV (including activities generating management. relationship viewer and

Also in January 2010, Channel 4 commenced advertising sales Also in January 2010, The operation (‘Box’). Ltd Television Box for representation the expiry of Channel 4 following Sky to from transferred costs The additional held with Sky. previously Box the contract are Box for sales representation ad from and revenues within the Channel 4 segment as the members recognised of the the efficiency improves representation consider that sales operation. ad In January 2010, it was announced by the London Organising Organising the London announced by it was In January 2010, Channel 4 had the Olympic Games that for Committee 2012 the London rights for the UK television been awarded of coverage 150 hours over to Games. In addition Paralympic content Games, Channel 4 will deliver of the Paralympic disability sport in the and sporting key events showcasing the Games. up to leading years two in 2010 enabled us to reinvest more into content and content content and content into more reinvest to us enabled 2010 in of ahead surplus a deliver and portfolio our across delivery (2009: million £935.2 of revenues generated group The target. (2009: million £54.0 of tax before surplus a and million) £830.3 on funds and cash in increase an to led also which million), £2.2 the At million). £8.0 (2009: year the in million £49.3 of deposit strong a in reflected is performance robust this 2010 of end for funds provide to reserves in increase an with sheet, balance future against contingency additional and investment future volatility. advertising performance on our longer term through as focusing well As in March such as the launch of C4 HD on Freeview initiatives a key venture, 2010 and our ongoing support YouView the for Channel 4 audience share hold core to priority in 2010 was of core the audience share as far as possible. Defending in 2011 focus be our principal Channel 4 will continue to the digital alongside maximising the contribution from channels and video on demand services and developing relationships. in advertising sales and viewer innovation Financial Review Financial some and migration digital of pressures underlying the Despite anticipated than conditions market better competition, strong 5. Operating profit/(loss) Operating 5. financial performance of and our This is used as a measure It does the future. into remit our continue fulfilling ability to or losses of profits share interest, account into take not behind factors The principal or taxation. joint ventures, from £3.9 million) are million (2009: of £49.3 profit our operating below. explained continued of our the majority 4 contributes Channel Although core generate continue to our digital channels advertising revenues, in public service more invest to us allows that value additional grew advertising revenues television in 2010, Overall content. Channel 4, million on core million, comprised of £63.4 £87.5 by million on TV the digital channels and £0.9 million on £23.2 the market from the channels benefited video on demand. All advertising in early 2010. in television recovery the members of Report

FINANCIAL REPORT AND STATEMENTS 94 FINANCIAL REPORT AND STATEMENTS 97 Members’ interests Members’ the principles of good corporate Channel 4 fully embraces of all full disclosure this end, makes and, to governance their to in addition members, During 2010, interests. members’ pages 151-153, fees as disclosed on salaries, benefits and/or arm’s at negotiated contracts in the following interested were with the group: terms length on normal commercial Association’s Andy Barnes is also a member of the Advertising £96,208 Association the Advertising council. Channel 4 paid and funding. No fees of membership during 2010 in respect December 2010. 31 or due at accrued amounts were Burns is UK plc. Santander also Chairman of Santander Lord advertises its services on Channel 4. Waitrose of Waitrose. Mark Price is also Managing Director the on Channel 4. Where is a sponsor of programming in an advertising or sponsorship an interest have members not are or payable the amounts paid client of the group, via media and transacted negotiated are disclosed as they 114). buying agencies (page Members and full responsibility have of the Board The members policies and the group’s deciding and operating for discretion affairs. the conduct of the group’s for 148-149. on pages listed of Channel 4 are members The current been have members the following Since 1 January 2010, resigned: or have appointed on 28 January appointed was Burns (Chairman) Terry Lord Johnson, whose appointment Luke Burns replaced Lord 2010. January 2010. ended on 27 between Executive Chief as Interim acted Anne Bulford joined Abraham when David 2010, 2009 and 4 May 17 November Executive. Channel 4 as Chief on 30 April the Board from resigned and Jon Gisby Lygo Kevin 2010 and 19 July 2010 respectively. ended on appointments both and Andy Mollett’s Brady Karren 2010. 30 September Rivers Mark Price and Richard Alicja Lesniak, Monica Burch, 2010. on 1 October the Board to all appointed were end, on 10 January Hunt joined the year Subsequent to 2011 Jay Officer. Creative Channel 4 as Chief Barnes Andy 2011 March 30 on end, year the to subsequent Also Board. the from resigned contained within the are remuneration Details of members’ 150-153. on pages remuneration report on members’ Breach of regulatory codes, including in particular of regulatory the Breach in the imposition of Code, resulting Broadcasting Ofcom a statutory sanction; in law); no defence have which we (to of the civil law Breach and defence no have which we (to of the criminal law Breach in law). the members of Report continued ensuring that is body for the main 4 Board The Channel its public serviceChannel 4 meets all of responsibilities. and the delivery output of the Channel’s programming Current the Board. by regularly reviewed are obligations programming introduced arrangements Under the enhanced accountability to Channel 4 is required 2010, Act Economy the Digital by containing Policy of Media Content publish an annual Statement year of performance of the previous review a retrospective is compiled This Statement year. next the and our strategyfor guidelines and in consultation with Ofcom in accordance section of this and is published in the front with Ofcom, Policy Content of Media Annual Report. The Statement also Policy Programme of the Statement incorporates legislation. current by required Obligations and Regulatory 3. Legal to the publication relation in significant risks three are There Channel 4: by of content — — — and compliance a number of detailed legal are There these risks that ensure designed to and protocols procedures procedures managed. These identified and appropriately are the heart of these At staff. all relevant mandatory for are Process Referral-Up Editorial is Channel 4’s procedures Handbook. which is set out in the Independent Producer staff senior editorial and involves process The referral-up Executive Officer and the Chief Creative the Chief ultimately independent that also requires This process Chief. as Editor-in have they that 4 ensure with Channel working producers and compliance legal so that procedures internal their own and Channel 4 as senior executives to referred issues are difficult that ensure to exist Such procedures appropriate. are and compliance matters and fine-cut decisions on legal staff, editorial the most experienced by considered properly within Channel 4. and senior executives lawyers content

Risks and the faces, group the that risks the key are Outlined below details of our Further them. mitigate to taken steps key the Corporate in provided are structure governance 141-147. section on pages Governance revenues 1. Dependence on advertising television from is derived revenue of Channel 4’s 85% means advertising. of revenue This form dependency upon one well as as fluctuations cyclical is susceptible to the group that Advertising changes in the advertising market. structural change to and has the potential variable income is extremely result of year as a of the significantly during the course conditions. The market or broader changes in audience share year which limits our ability within a fixed majority of costs are in advertising short income. to downturns term respond to the advertising this risk Channel 4 monitors mitigate to In order identify very closely to of the market and its share market far as possible the As respond. to time allow and to trends base. cost a flexible phases commitments and seeks group Risk The Treasury Channel 4 also maintains cash reserves. and forecast cashflow the group’s reviews regularly Committee cash. for requirements and industry expectations internal experience, recent Following assume assumptions 2011 revenue our budgeted forecasts, in TV can these conditions advertising.modest growth As month and each forecasts monitors the Board change quickly, conditions as market to respond to in order ongoing trends soon as possible. 2. Ofcom Licence Obligations to fulfil the failure would be any to Channel 4 A significant risk delivery of our remit. governing statutory responsibilities issued with a detailed Digital In December 2004 Channel 4 was which sets out all of its formal Licence (‘DRL’) Replacement obligations. including detailed programming obligations, 4’s Channel of some for agreed were quotas licence Revised report. this of 155 page on published are and 2010 in obligations

A summary of significant accounting policies is provided in A summaryaccounting policies is provided of significant of this report. 108-113 pages Accounting policies Accounting The Channel Four Television Staff Pension Plan was closed to closed to Plan was Pension Staff Television The Channel Four 2008 and a new 1 September from with effect joiners new the same date. opened from Scheme Defined Contribution The most recent independent triennial valuation was carried was independent triennial valuation The most recent 1 Januaryout as at subsequently at 2009 and updated and recovery The subsequent valuation 1 January 2010. 20). 2010 (note in March the Board by approved plan were Pension Staff Television The assets and liabilities of the Channel Four 2010 in December 31 at been valued Plan have Pension and the net Benefits’ with IAS 19 ‘Employee accordance in the recorded million has been deficit of £35.4 accounting 20). The sheet (2009: £44.9 million) (note end balance year additional employer result of reduced in 2010 as a deficit has in million made contributions including a contribution of £2.9 on plan returns than expected December 2010 and better assets held in equities. Cashflow the 107, page on statement cashflow in the group shown As in a resulted million year of £54.0 for the tax before profit tax before (2009: profit cash inflow million net operating £49.5 million). of £5.2 inflow cash and net operating million of £2.2 million at £99.0 were activities financing from Net cash outflows (2009: net cash inflows in 2010 extended deposits were as term continued were and cash equivalents cash Group million). of £40.0 million) December 2010 (2009: £201.9 31 at million £152.2 months three million held on deposit for with a further £109.0 15). million) (note or longer (2009: £10.0 the members of Report

FINANCIAL REPORT AND STATEMENTS 96 FINANCIAL REPORT AND STATEMENTS 99 . In order to effectively target and monitor and monitor target effectively to . In order 3 consumption, we are investing in smart solutions. In metering investing are consumption, we identify will continue to efficiency other and implement 2011, we to in order campaigns and carry out awareness measures consumption. water overall reduce Biodiversity carry to out Trust Wildlife the London engaged we During 2010, to in order of a section of our landscaped area, replanting Other in particular invertebrates. biodiversity, more attract installing bird in 2011 include will be investigating we initiatives Road. Horseferry at boxes and bat Environment of our effects adverse minimising any to committed are We resources. and finite environment on the natural operations policy and during 2010 an established environmental have We management system, started implementing an environmental understand helping us better for a framework which provides and manage, evaluate impacts, and describe our environmental we In 2011, way. our performance in a verifiable and improve business energy, to in relation targets will be setting reduction and water. waste travel, the of refurbishment large-scale a out carried we 2010, During our at facilities shower and toilet and floor ground lower optimise to opportunity this took We property. Road Horseferry energy building’s the improve simultaneously and space, our or re-used sourced, naturally used also We efficiency. water and possible. where design the throughout materials recycled Carbon footprint an in-house carbon reporting developed we In 2010, (GHG) gas greenhouse aligned with government framework, our carbon emission reporting guidance. Using this framework, emissions emitted direct to on a scope limited (based footprint emissions from the point of combustion of fuels and indirect at over by electricity) has reduced the consumption of purchased to is attributed This reduction our 2009 baseline. against 15% refurbishment the accommodation some activities; outsourcing of our the efficiencies improving Road; Horseferry at project and energy systems in our building control investing servers; In 2011, campaigns. awareness plant; and carryingefficient out identify on continuing to will focus energy and implement we reporting the to developing addition in measures, efficiency emissions, including transport-related our indirect for system activities. Waste from generated waste 40% of the office and kitchen Over with the during 2010, recycled was offices our main London 60% Over or energy. materials for being recovered remainder being recycled with the remainder re-used was of our IT waste separate introduced we In 2010, materials. re-useable into disposal, with the aim of improving waste food/biodegradable the on reducing will focus In 2011, we rates. our recycling campaigns awareness through produce we amount of waste scope of our reporting. the and extend Water assessment of our water carried out a baseline we In 2010, this offices, estimating our main London consumption at be 14,000m to the members of Report continued Suppliers in behaviour responsible promote aim to applicable, we Where are we in this area, our work progress the supply chain. To strategy. procurement a sustainable developing Community In in the community. role a responsible play continue to We our through achieved the community engagements to addition in partnership with our also work we programmes, diversity a play to of charitable organisations and a variety suppliers our approach, formalise To in the community. role responsible a charitable strategy. developing currently are we Charitable donations charities (2009: £1.4 million to donated the group During 2010, million) was million (2009: £1.0 million). Of this amount, £1.1 £1.1 the overall improve to training provide charities to to paid in Once again staff expertise in the industry. of television cast during vote each for made was a charity payment 2010, totalling the final series for charity donations with Big Brother million) charities (2009: £0.1 four to million paid £0.3 Big4 art project metal ‘4’ outside our London The Big 4 is a 50-foot-high of artists, a variety Since its inception in 2007, headquarters. talent, have and emerging renowned internationally both a regular into has evolved the 4. The project ‘skins’ for created art graduates, competition for and recent and design students of art a panel with the winning design chosen by and design Imbeau Stephanie by created experts. The 2010 ‘skin’ was 2011 skin has been The Big 4’s entitled Shelter. and was Graduate, & Textile a Fashion Hannah Gourley, to awarded Breathe. Time to for Open House at headquarters London of our opened the doors we In 2010, support to a number of community and Road Horseferry one of including Open House London, charitable initiatives, set up to Open House was festivals. cultural largest London’s of the value for learn about and advocate enable people to first-hand neighbourhood through London good design in every the years, design. Over architectural of excellent experience the opportunity had explore to people have 10,000 than more also we In 2010, headquarters. award-winning our architectural almost 100 school to Road Horseferry at opened the doors in Schools part as Architecture of Open-City’s children 2000 students across enable over helping to programme, exemplary and understand explore encounter, to London in their city. architecture supported Maggie’s running, we the second year for In 2010, 2,000 around to and opened our doors Cancer Caring Centres building providing people taking part Night Hike, in The London succeeded in raising entertainment. and snacks The hike tours, the charity. million for £0.6 over Accountability and Our Board behaviour. responsible promote aim to We the highest promoting to committed have team executive and are behaviour corporate of responsible standards a this. In support for accountable have ultimately of this, we policies and of other Code of Conduct and a suite Corporate ensure To accountability. for framework a providing procedures and our CR strategy enlightened in an develop continue to we of Business in the members are we manner, informed and the Corporate the Media CSR Forum Community, and forums of these groups Membership Group. Responsibility to and methods in order good practice share enable us to common obstacles. overcome performance our and CR to approach our on reported have We will we 2011, In 2004. since Accounts and Reports Annual our in reporting. external and internal our develop to continue Staff development Staff depends the success of our organisation that understand We the best people. In and retaining developing upon recruiting, strategy to learning and development our expanded we 2010, support To our business drivers. and renewal creative link both objective integrating tool launched a dedicated we this strategy, feedback planning, 360 degree development setting, personal opportunities. and learning and development including of activities a range through support development We and sessions, coaching size learning, bite and informal formal and courses training and full day schemes, half mentoring 550 of our people over In 2010, events. lunchtime and evening activity. of learning and development some form attended Health and wellbeing and environment a working providing to committed are We and we and good health, staff wellbeing promote that practices help need to they the information employees our give aim to An outside work. lifestyle and maintain a healthy them adopt supports Health Nurse Occupational staffat on-site in being fit impartial confidential, support through advice. work and and mini vaccinations annual flu free offered are Employees cholesterol checks, including blood pressure health checks and and a body impedance test, a body mass index checks, on the results. based advice as part Insurance Medical of our Private All staff receive an Employee provide we also and package benefits flexible hour confidential personal offering 24 Programme Assistance support, staff In addition, counselling and advice. can purchase extensive comprising benefits such as health screens other for loans provides scheme that Work to a Bike health tests, women to screening breast screening, skin bicycles, purchasing also provided are Staff under 40 and critical illness insurance. service regular with on our intranet wellbeing with a dedicated tips. health and wellbeing featuring newsletters

Cultural Diversity Network Diversity Cultural 2009/10 for (CDN) Network Diversity Cultural the of Chair As aims Pledge The 2009. April in Pledge Diversity the launched we to producers independent and broadcasters encourage to off-screen. and on both closely more society British reflect also 4 Channel 2010 In 2010. November in ceremony second a diverse strengthened has which scheme mentoring CDN the ran industry. the in talent Breaking down barriers to entry barriers Breaking down in barriers down break to in order strategies varied employ We tools online and social networking from ranging our industry, entrant new structured to mentoring face to and face external two won our programmes During 2010, programmes. Placement New Experience Provider Work – Best awards In the (BITC). Award Inspiration and a Work (NCWE), Schemes 2000 with over engaged have our programmes years last two 50% of with over activity, face to people with face young a diverse coming from the programme participants across this type of for average the national above background, hard also delivered have These programmes engagement. further participants with 43% of gaining results progression olds securing 18 year and 17% of over experience work include a structured to will expand In 2011 we employment. scheme. apprenticeship and a new programme internship Employment policy Employment Channel 4 is an equal opportunities and does not employer marital orientation, sexual of sex, on grounds discriminate age or political or ethnic origin, disability, colour, race, status, policies. employment or other in its recruitment belief religious on all aspects of regularly be monitored continue to Figures of ethnic minorities The representation of employees. diversity 13% (2009: 12%). Women amongst permanent staff in 2010 was (2009: 55%). the majority of staff 57% form at continue to Our belief is that diversity contributes to the fulfilment of our the fulfilment to contributes is diversity that Our belief can we being the best that and to public service remit talent within our nurture and develop aim to be. We creatively with work the media industry to in order business and across the UK. of people across range the most diverse People production independent 250 up signing to committed CDN The by suppliers) and producers in-house as well (as companies After 12%. by exceeded was that target a 2010, December to 2009 November in Awards Diversity CDN the inaugurating hosted 4 Channel media, the in practice diversity celebrate Corporate Responsibility Corporate Our television. powerful creating beyond goes role 4’s Channel balance a strike to us required always has model operating our of aim The content. commercial and service public between public our fulfil to is strategy (‘CR’) Responsibility Corporate CR our end, this To manner. responsible a in remit service personal and environmental social, promote to is mission develop to continue we mission, our achieve to order In change. Accountability, People, areas: impact five around strategy our Environment. and Community Suppliers, continued the members of Report

FINANCIAL REPORT AND STATEMENTS 98 FINANCIAL REPORT AND STATEMENTS 101 the financial statements give a true and fair view of the a true and fair view give the financial statements as at affairs and of the Corporation’s of the Group’s state year for the profit December 2010 and of the Group’s 31 then ended; been properly have financial statements the group the EU; by as adopted with IFRSs in accordance prepared been properly have statements financial the Corporation the by as adopted with IFRSs in accordance prepared with the provisions EU and as applied in accordance applied to Act 2006 as if that Act of the Companies the Corporation; accordance in prepared been have the financial statements the applied to Act 2006, as if that Act with the Companies Corporation. Report which the part Remuneration of the Members’ in prepared audit has been properly to engaged were we and Medium- The Large 8 to with Schedule accordance and Reports) (Accounts and Groups Companies sized apply to were 2008, as if those requirements Regulations the Corporation; to Report the for in the Members’ given the information are for which the financial statements year financial with the financial statements. is consistent prepared Scope of the audit of the financial statements of the audit of Scope about the amounts obtaining evidence An audit involves to sufficient statements in the financial and disclosures the financial statements that assurance reasonable give whether caused by misstatement, material from free are This an assessment of: whether the includes or error. fraud and the Corporation to appropriate policies are accounting applied been consistently and have circumstances Group’s of significant disclosed; reasonableness the and adequately the overall and the members; by made estimates accounting all read we addition In of the financial statements. presentation Report in the Annual information the financial and non-financial financial identify with the audited to inconsistencies material material apparent of any become aware If we statements. consider the implications we or inconsistencies misstatements report. our for Opinion on financial statements In our opinion: — — — — prescribed under matters Opinion on other our engagement of the terms In our opinion: — — Respective responsibilities of members and auditor of responsibilities Respective As explained more fully in the Members’ Responsibilities Responsibilities fully in the Members’ more explained As responsible are the members 141, set out on page Statement are which of the financial statements the preparation for Our responsibility a true and fair view. give them to by intended an opinion on the financial statements audit, and express is to Standards and International with applicable law in accordance us to require Those standards (UK and Ireland). on Auditing Ethical (APB’s) Board’s Practices comply with the Auditing Auditors. for Standards Report of Report auditors the auditor’s Independent members the to report Four Channel of Corporation Television ‘Corporation’) (the of the Corporation statements the financial audited have We 104-140. on pages December 2010 set out ended 31 the year for has been applied in that reportingThe financial framework Financial and International is applicable law their preparation the EU and in by as adopted (IFRSs) Reporting Standards 2006 Act of the Companies with the provisions accordance the Corporation. applied to Act as if that the our audit of the financial statements, to In addition in the audit the information us to engaged have members Report is that described as having Remuneration Members’ prepare to decided have which the members been audited, comply with the to required were as if the Corporation and Medium-sized The Large 8 to of Schedule requirements and Reports) Regulations (Accounts and Groups Companies 2006. Act under the Companies made 2008 (SI 2008 No. 410) members, This the Corporation’s report solely to is made 1990 and Act with the Broadcasting in accordance as a body, of the separate and, in respect of our engagement, the terms Report and Remuneration the Members’ to opinion in relation been have that on terms governance, reporting on corporate might has been undertaken we so that Our audit work agreed. to agreed have we that those matters the members to state the purpose. To no other them in our report, and for to state or assume accept do not we law, by permitted fullest extent and the the Corporation than other anyone to responsibility this report, for or our audit work, for as a body, members, formed. have the opinions we for

so far as the member is aware, there is no relevant audit is no relevant there isso far as the member aware, unaware; are auditors of which the company’s information and ought to he/she that all the steps the member has taken himself/herself make to in order as a director taken have establish and to audit information relevant of any aware information. of that aware are auditors the company’s that Going concern Going affect its to likely the factors activities, business The group’s and performance, the financial position of development future Report set out in the of the are and its cash flows the group the financial 18 to note In addition, 92-97). (pages members financial risk to approach includes the group’s statements and hedging management, including its financial instruments risks. liquidity and credit to and its exposures activities based and resources financial has considerable The group the procedures, on normal business planning and control manage its to placed is well the group that believe members expectation a reasonable have The members business risks. for existence will continue in operational the group that the adopt continue to and therefore future the foreseeable the annual in preparing of accounting going concern basis financial statements. of the Board: Order By Abraham David Executive Chief 2011 30 March Disclosure of information information of Disclosure auditors to of approval who is the date a member at of the persons Each of this Annual Report confirms that: — — Auditors 4 with Channel to as auditors been appointed KPMG LLP have Media and Culture, for of State of the Secretary the approval continue in their willingness to expressed Sport, and have office.

Channel 4 website 4 Channel all across with viewers with our strategy connect to In keeping at Channel 4 has published this report on its website platforms, channel4.com/annualreport. Through strict adherence to the policies, cash and other the policies, cash and other to strict adherence Through a number of across spread were financial asset deposits or either AA-rated were financial institutions, all of which the UK Government. by backed management management within operates management function treasury The group’s Details of Board. by the policies determined defined treasury are matters cash and treasury currency, foreign the group’s on the group’s including information 19, disclosed in note liquidity rate, interest currency, foreign market, to exposure in respect required as the disclosures risk as well and credit of IFRS 7 ‘Financial Instruments: Disclosures’. cash and treasury treasury and cash Group foreign currency, currency, foreign Group Development of the development to substantial resources devotes The group and development possible commissioning. Research scripts for in 2010 the income statement to charged expenditure 3). (note million) £5.3 million (2009: £10.3 to amounted continued the members of Report

FINANCIAL REPORT AND STATEMENTS 100 the members’ statement, set out on page 100, in relation to to in relation 100, set out on page statement, the members’ going concern; and on pages Statement Governance the part of the Corporate with the compliance Corporation’s the to relating 141-146 the June 2008 Combined Code specified of nine provisions review. our for In addition to our audit of the financial statements, the statements, audit of the financial our to In addition their Corporate review us to engaged have members required were as if the Corporation Statement Governance Rules and the Disclosure comply with the Listing Rules to in of the Financial Services Authority Rules and Transparency of our engagement the terms Under those matters. to relation review: to required are we — — Hugh Green Auditor Statutory KPMG LLP, and on behalf of for Accountants Chartered Square 15 Canada London E14 5GL 2011 30 March

proper accounting records have not been kept by the by been kept not have records accounting proper not our audit have for adequate or returns Corporation, us; or by visited not branches from been received and the individual financial statements the Corporation’s Report be audited to part Remuneration of the Members’ and records the accounting with in agreement not are returns; specified remuneration certain of directors’ disclosures or made; not are law by and explanations all the information received not have we our audit. for require we

— — — — Under the terms of our engagement we are required to report to required are we of our engagement Under the terms in our opinion: if, you to auditors continued auditors to report are required on which we Matters exception by of the following: report in respect to nothing have We Report of the of Report

FINANCIAL REPORT AND STATEMENTS 102 FINANCIAL REPORT AND STATEMENTS 105 £m Total equity non-

controlling Attributable to 4

Revaluation Channel

reserve £m interest £m £m total Group earnings Retained

Other

— — — — (0.4) (0.4) £m £m 2.9 — 2.9 — — 2.9 (5.7) 44.3 38.6 — — 38.6 (17.1) — (17.1) (1.4) — (18.5) (46.5) 46.8 0.3 — — 0.3 391.7 66.6 458.3 — — 458.3 394.5 22.3 416.8 — — 416.8 458.1 (24.5) 433.6 1.4 0.4 435.4 394.5 22.3 416.8 — — 416.8 earnings earnings Retained Retained Channel in equity changes of Statement December 31 ended year the for At 1 January 2009 (Loss)/profit for the year Other comprehensive cost for the year comprehensiveTotal (cost)/income for the year Transactions with owners recognised (63.6) directly in equity: Dividends paid equity to owners DecemberAt 31 2009 46.8 At (16.8) 1 January 2010 (Loss)/profit for the (1.4) year Other comprehensive income for the year comprehensiveTotal (cost)/income for the year — DecemberAt 31 2010 (2.8) (18.2) 44.3 41.5 — — 41.5

Group 2009 £m Group 2009 £m — (1.4) £m £m 2.9 0.3 2.9 (18.5) 1.8 (2.0) 4.6 (23.7) 2010 2010 (1.7) 6.6 17.4 11.1 41.5 (18.2) 49.3 3.9 85.3 51.6 54.0 2.2 38.6 0.3 38.6 0.3 (15.6) (13.1) (15.4) (1.9) Group Group (36.0) (47.7) (849.9) (778.7)

Note

Note 6

5 5 10 2 3 20

1 2 935.2 830.3

Income tax expense Profit for the year Share of profit of investments accounted for using the equity method, net of income tax Profit beforetax 8 comprehensiveTotal income/(cost) for the year Net finance income/(expense) Other comprehensive income/(cost) for the year Financial income Financial expense Deferred tax on pension scheme recognised directly in other comprehensive income Revaluation of freehold land and buildings 12 Other operating expenditure Operating profit Net actuarial gains/(losses) on pension scheme Gross profit Profit for the year

for the year ended 31 December ended 31 year the for Statement of comprehensive income of comprehensive Statement Cost of transmission and sales Revenue for the year ended 31 December 31 ended year the for Consolidated income statement statement income Consolidated

FINANCIAL REPORT AND STATEMENTS 104 FINANCIAL REPORT AND STATEMENTS 107 4

Channel 2009 £m 4

— — — — — — — — — — — — — £m 1.7 2.3 1.9 6.2 1.5 1.4 3.6 5.4 2.4 2.8 2010 (1.1) 25.2 (5.7) (46.5) (4.7) 6.2 (0.1) (0.2) (0.7) (46.4) (1.2) 2.2 52.7 9.5 (3.3) (0.2) (0.8) (15.1) 50.3 6.7 (16.2) 4.8 201.9 152.8 (99.0) (99.0) 40.0 40.0 152.2 201.9 Channel Group 2009 £m — 1.9 — (0.5) — (1.9) £m 1.7 2.3 1.0 0.2 2.1 6.2 3.8 1.8 0.2 — 2.3 2.2 4.2 5.4 2010 (7.7) (7.2) (4.1) 7.2 (0.1) 3.0 (0.1) (0.2) (1.8) 2.0 (5.0) (1.7) (4.2) (1.7) 57.2 12.4 (2.9) 0.3 49.5 5.2 15.4 1.9 (0.8) (0.8) (0.8) (0.8) 58.9 16.6 30.8 15.4 73.0 16.9 38.6 0.3 (49.6) 48.2 (49.6) 49.3 (16.2) 4.3 (12.2) (31.1) 201.9 153.9 Group (99.0) 40.0 152.2 201.9

8 8 5 8 9 9 8 8 5 6 11 11 11 10 10 15 (99.0) 40.0 Note software 10, inventories 13

other

and developed

and

* rights

film

and equipment

and

plant

programme

property,

Cashflow from financing activities Dividends received Distribution from UK LLP VOD Net cashflow from investing activities Net cashflow from financing activities Net (decrease)/increase in cash and cash equivalents Cash and cash equivalents 1 January at Effect of exchange rates on cash held Cash and cash equivalents December at 31 months or longer. deposits of three in term Amounts invested (paid)/repaid Tax Cashflow from investing activities Repayment of loan and shares by equity investments Acquisition of equity investments Purchase of property, plant and equipment Investment in internally developed software Net cashflow from operating activities Interest received Cash generated from operations (Increase)/decrease in trade and other receivables Increase in trade and other payables (Decrease)/increase in provisions, excluding unwinding of discounts 17 Impairment of equity investments Reversal impairment of in UK LLP VOD Operating cashflow before changes in working capital and provisions Changes in working capital: (Increase)/decrease Amortisation of intangibles Share of (profit)/loss from investments accounted for using the equity method, net of income tax Net finance (income)/expense Impairment Depreciation Adjustments for: Income tax expense/(credit) statements Cashflow December 31 ended year the for Profit/(loss) for the year Cashflow from operating activities (Increase)/decrease in other financial assets * 4

Channel £m 2009 4

— — — — — — — — £m 3.1 4.5 5.8 8.1 0.8 3.2 2010 (3.1) (7.3) (0.1) — (3.9) (17.7) 11.8 15.7 61.2 70.3 40.5 42.0 391.7 394.5 391.7 391.7 394.5 394.5 187.0 182.3 (39.4) (53.5) (35.4) (44.9) 116.0 114.9 109.0 10.4 565.0 512.7 152.2 201.9 (195.1) (135.0) (234.5) (188.5) Channel Group £m 2009 — — — 0.2 £m 7.1 8.1 1.6 2.5 4.8 7.0 2010 (3.1) (7.3) (0.1) — (2.7) (4.0) (0.8) (1.3) (3.9) (17.7) 27.6 28.9 (6.4) — 93.6 104.5 12.0 16.0 40.5 42.0 717.6 663.5 626.2 583.0 (41.3) (56.2) (35.4) (44.9) Group 109.0 10.4 152.2 201.9 156.8 144.6 458.3 416.8 624.0 559.0 206.0 201.9 (259.3) (246.7) (218.0) (190.5)

458.3 458.3 416.8 416.8

9 8 7 11 17 17 14 14 16 16 (207.7) (172.8) (191.2) (117.3) 10 10 18 15 15 12 12 13 20 Note

Equity investments Freehold land and buildings Fixtures, fittings and equipment Intangible assets Deferred tax assets Programme and film rights and other inventories non-current Total assets and Trade other receivables Investments accounted for using the equity method Investments in subsidiaries Current tax assets Assets as at 31 December 31 as at sheets Balance

Liabilities Employee benefits – pensions Provisions Other financial assets assetsTotal Deferred tax liabilities Cash and cash equivalents current Total assets and Trade other payables Current tax liabilities non-current Total liabilities Other financial liabilities The notes on pages 114 to 140 form part 140 form of these financial statements. 114 to on pages The notes David Abraham David Executive Chief Lord Burns Chairman Retained earnings equityTotal signed off on its were 2011 and on 30 March of members Board by the approved were to 140 pages 104 on The financial statements behalf by: Net assets Provisions liabilitiesTotal current Total liabilities

FINANCIAL REPORT AND STATEMENTS 106 FINANCIAL REPORT AND STATEMENTS 109 Intragroup balances and any unrealised gains and losses or gains unrealised and any balances Intragroup in the same way as unrealised gains, but only to the extent that that the extent but only to gains, unrealised as in the same way income and expense arising from intragroup transactions are are transactions intragroup arising from income and expense Unrealised gains arising from transactions with associates and with associates transactions arising from gains Unrealised Revenue from sponsorship of the group’s programmes and programmes of the group’s sponsorship from Revenue lm and television rights is the sale of film and television from Revenue telephony rate of premium the provision from Revenue involving barter transactions from recognised are Revenues jointly controlled entities are eliminated to the extent of the the extent to eliminated entities are jointly controlled there is no evidence of impairment. of impairment. is no evidence there the advertisement. campaign. sponsorship each schedule for the transmission t organisations. Cost contributions to those Cost contributions to fit organisations. not-for-pro occur. they period that and exists arrangement of an evidence performed, persuasive Online advertising revenue is recognised over the period of over is recognised Online advertising revenue for advertising representation Commission earned from of the on transmission isparties recognised the group outside arrangements. advertisements in line with contractual related in turnover. recognised and the of the contract, of signature on the later recognised delivery. for available been made rights have programme are when DVDs recognised are revenues Consumer products period of the subscription. where these are borne and paid by advertisers, and value and value advertisers, by borne and paid these are where assured. when collectibility is reasonably Sales generated on behalf of entities outside the group are not not are on behalf of entities outside the group Sales generated the over recognised are and similar revenues Subscription fee lms is recognised on a straight line basis in accordance with in accordance line basis on a straight films is recognised start of the licence period, provided that the film or the film that start of the licence period, provided call volumes. services in line with contestant is recognised group’s interest in the equity. Unrealised losses are eliminated eliminated losses are Unrealised in the equity. interest group’s added tax. Revenues are recognised when services have been when services have recognised are tax. Revenues added advertising when the services exchanged are dissimilar, and dissimilar, are advertising when the services exchanged of the the fair value to with reference measured are advertising provided. organisations are charged to the income statement in the the income statement to charged are organisations display of the advertisement. display returns, anticipated for net of a provision retailers, to delivered place. takes when the event events, 4-branded or for eliminated in preparing the consolidated financial statements. financial statements. the consolidated in preparing eliminated As explained in note 8, certain of the group’s joint ventures are are ventures joint 8, certain in note of the group’s explained As net of advertising agency commissions stated are All revenues Revenue recognition recognition Revenue Television advertising revenue is recognised on transmission of on transmission is recognised advertising revenue Television

Revised IFRS 3 – Business Combinations Revised Separate and – Consolidated IAS 27 Amendments to Financial Statements IAS 39 and IFRS 7 – Financial Instruments Amendments to Derivatives IAS 39 and IFRIC 9 – Embedded Amendments to IASB April 2009) IFRS (issued by to Improvements losses exceeds its interest in an associate, the group’s the group’s in an associate, its interest losses exceeds has the group that the extent to losses is discontinued, except uence, but not control, over the financial and operating the financial and operating over control, influence, but not for is classified as held influence ceases or until the associate incurred legal or constructive obligations or made payments payments or made obligations or constructive legal incurred to govern the financial and operating policies of an entity so as policies of the financial and operating govern to The financial statements activities. its obtain benefits from to using the for accounted ceases. Investments control that policies. The consolidated financial statements include the include financial statements policies. The consolidated Subsidiaries are entities controlled by the group. Control Control the group. by entities controlled Subsidiaries are of share When the group’s Sale and Discontinued Operations’. statements from the date that control commences to the date the date commences to control that the date from statements significant that significant influence commences until the date Held for Assets with IFRS 5 ‘Non-current sale in accordance group’s share of the total recognised gains and losses of gains recognised of the total share group’s group’s share of total recognised gains and losses using the gains recognised of total share group’s associates on an equity accounted basis, from the date that that the date from basis, on an equity accounted associates activities the group has joint control, established by established by has joint control, the group activities exists when the group has the power, directly or indirectly, or indirectly, directly has the power, when the group exists financial included in the consolidated of subsidiaries are and joint ventures. equity method comprise associates of further nil and recognition carrying to is amount reduced contractual agreement. The financial statements include the The financial statements agreement. contractual joint control that the date from equity method of accounting it ceases or until the jointly controlled the date commences to 5. with IFRS accordance for sale in entity is classified as held on behalf of an associate. on behalf of an associate. Associates are those entities in which the group has significant those entities in which the group are Associates accounting Significant continued policies policies that and Channel 4 accounting A summary of the group The is below. set out accounts of the context in the material are all to been applied consistently policies have accounting in these financial statements. periods presented and amendments, interpretations standards, new The following a had not have 1 January 2010, time from the first for effective on the financial statements: effect material — — — — — standards amendments to standards, A number of new annual periods beginning for effective are and interpretations been applied in preparing not after 1 January 2011 and have expected None of these are financial statements. consolidated financial effect on the consolidated a significant have to of the group. statements Jointly controlled entities are those entities over whose those entities over entities are Jointly controlled Accounting policies policies Accounting consolidation of Basis by independent actuaries, with input from the members. The the members. with input from independent actuaries, by has a present legal or constructive obligation as a result of a as a result obligation or constructive legal has a present is If the effect settle the obligation. to benefits will be required expectation a reasonable have The members business risks. Programme and film rights are included in the balance sheet balance included in the film rights are and Programme future development and performance, financial position of the development future unlikely to be transmitted in their originally intended slot or slot in their originally intended be transmitted to unlikely on past be paid tax to the liability for used in determining issues which complex but this can involve be reasonable to Report set out in the of the are and its cash flows the group for existence will continue in operational the group that the adopt continue to and therefore future the foreseeable net realisable value, consideration is given to when the when the to is given consideration value, net realisable and the for transmission scheduled films are and programmes which, taking into Programmes production. in programmes of economic an outflow that and it is probable event, past discounting the by determined are provisions material, 20. note The recognised in the financial statements. are which profits The final determination resolve. to a number of years take may the financial 18 to note In addition, 92-97). (pages members management, including its financial instruments and hedging manage its to placed is well the group that believe members c to the liability (note 17). the liability (note specific to the risks appropriate, where financial statements. Provisions for onerous contracts for Provisions post retirement benefit obligations Employee Programme and film rights Programme Going concern vary from time to time according to prevailing economic and prevailing to time according time to vary from Income tax sold are expensed to the income statement (note 13). (note income statement the to expensed sold are and mortality These assumptions salary rates. progression in provided are social conditions. Details of assumptions used financial risk to approach includes the group’s statements group considers the estimates, assumptions and judgements assumptions the estimates, considers group the annual in preparing of accounting going concern basis and represent the present value of the obligation calculated calculated of the obligation value the present and represent on assets, return assumptions, including discount rates, at the lower of cost and net realisable value. In estimating In estimating value. of cost and net realisable the lower at judgement are in management’s expectations, viewing account the Where and regulations. tax laws complex to according risks. liquidity and credit to and its exposures activities obligations under the plan are recognised in the balance sheet in the balance recognised under the plan are obligations is dependent upon numerous of thisestimation obligation contracted sales price and projected costs to complete for for complete costs to sales price and projected contracted flects re that rate a pre-tax at cashflows future expected and, of money assessments of the time value market current are estimates is unclear, and regulations of these laws effect the from tax liabilities could be different of prior years’ Further analysis statements. financial the in reflected estimates 6. in note of income tax is provided the procedures, on normal business planning and control A provision is recognised in the balance sheet when the group sheet when the group in the balance is recognised A provision

The group operates a defined benefit pension plan. The operates The group The actual tax on the result for the year is determined is determined the year for tax on the result The actual affect its to likely the factors business activities, The group’s based and resources financial has considerable The group

International Financial Reporting Standards as adopted by the by as adopted Financial ReportingInternational Standards is 124 Horseferry Road, London, SW1P 2TX. SW1P London, Road, Horseferry is 124 information relating to Channel 4 as a separate entity and Channel 4 as a separate to relating information income and expense during the reporting period. Although income and expense hundred thousand. The financial statements have been have thousand. The financial statements hundred historical cost convention, except that freehold properties freehold that except cost convention, historical EU (Adopted IFRSs). On publishing 4 financial the Channel IFRSs). EU (Adopted future periods. Judgements made by management in the by Judgements made periods. future the year ended 31 December 2010 comprise Channel 4 ended 31 the year the financial statements and estimates with a significant risk of and estimates the financial statements these estimates are based on management’s best knowledge best knowledge on management’s based are these estimates that affect the reported amounts of assets and liabilities at the amounts of assets and liabilities at affect the reported that members on 30 March 2011. The registered office of Channel 4 2011. The registered on 30 March members method. Channel 4’s own financial statements present present statements financial own method. Channel 4’s about its group. not Channel Four Television Corporation (Channel 4) is a Corporation Television Channel Four material adjustment in the next year are discussed below. discussed below. are year in the next adjustment material recognised in the period in which the estimate is revised if the is revised in the period in which the estimate recognised revision the of period the in or period, that only affects revision requirements, in so far as they are applicable, of the are in so far as they requirements, IFRSs. 2006 and Adopted Act Companies prepared in a form as may be directed by the Secretary of the Secretary by be directed as may in a form prepared presented in pounds sterling, rounded to the nearest one the nearest to rounded in pounds sterling, presented not to present its individual income statement and related and related income statement its individual present to not financial statements. a part form that of these approved notes Channel 4 is taking advantage of the exemption in section 408 of the exemption Channel 4 is taking advantage prepared and approved by the members in accordance with in accordance the members by and approved prepared State for Culture, Media and Sport with the approval of the Media and Sport Culture, with the approval for State statutory corporation domiciled in the United Kingdom. Kingdom. domiciled in the United statutory corporation statements here together with the group financial statements, statements, financial with the group together here statements and its subsidiaries (together referred to as the ‘group’) as the ‘group’) to referred and its subsidiaries (together equity using the for accounted investments and the group’s cant effect on a significant effect have that IFRSs of Adopted application and future periods if the revision affects both current and current affects both periods if the revision and future and financial instruments are stated at fair value; and are value; and are at fair stated and financial instruments are ongoing basis. Revisions to accounting estimates are are estimates accounting to Revisions ongoing basis. of the amount, event or actions, actual results ultimately may may ultimately results actual or actions, of the amount, event those estimates. differ from date of the financial statements and the reported amounts of and the of the financial statements date of the Companies Act 2006 as if those provisions were to apply to were 2006 as if those provisions Act of the Companies

Adopted IFRSs requires the use of estimation and assumptions the use of estimation requires IFRSs Adopted Statement of compliance of Statement accounting policies accounting Significant Basis of preparation of Basis The financial statements were authorised for issue by the by for issue authorised were The financial statements The consolidated financial statements of Channel 4 for of Channel 4 financial statements The consolidated The estimates and underlying assumptions are reviewed on an reviewed and underlying assumptions are The estimates The preparation of financial statements in conformity with in conformity of financial statements The preparation Treasury and meet the disclosure and measurement and measurement and meet the disclosure Treasury The financial statements have been prepared under the prepared been have The financial statements The group and Channel 4 financial statements have been have and Channel 4 financial statements The group

FINANCIAL REPORT AND STATEMENTS 108 FINANCIAL REPORT AND STATEMENTS 111 indication of impairment. If such an indication exists, the exists, such an indication If of impairment. indication is included in the carrying value of the associate or jointly is included in the carrying of the associate value Under IAS 27 revised from 1 January 2010 no goodwill on on goodwill no 2010 January 1 from revised 27 IAS Under balance sheet date to determine whether there is any is any whether there determine to sheet date balance Estimates are used in deriving these cash flows and the used in deriving these cash flows are Estimates the net identifiable assets acquired. acquired. the net identifiable assets the income statement. the independent cashflows, generate the asset does not purchase method. Identifiable intangible assets are those intangible assets are method. Identifiable purchase Goodwill separable. rights are of whether those regardless amounts arising of subsidiaries, on the acquisition represents entities and jointly controlled of associates Goodwill in respect Goodwill is charges. cost less impairment at Goodwill is stated whether or amortised impairment not annually for but is tested exists. of impairment indication an not acquisitions such no had group The 109). (page recognised in recognised are charges amount. Impairment recoverable risks specific to the asset and the time value of money. The value of money. the time to the asset and specific risks rate growth and long term performance, the discount rate which can be sold separately or arise from legal rights rights legal or arise from which can be sold separately which it belongs. sell and its value in use. Value in use is determined by by in use is determined in use. Value sell and its value statements. asset’s recoverable amount is estimated. The recoverable The recoverable amount is estimated. recoverable asset’s less costs to its fair value of amount of an asset is the greater associates or jointly controlled entities where a difference a difference entities where or jointly controlled associates of the acquisition. as a result is entities controlled jointly and associates of acquisitions its estimated unit exceeds asset or its cash-generating applied, affects the amounts reported in the financial applied, affects the amounts reported assets that generates cash inflows that are largely independent largely are that cash inflows generates assets that exists between the cost of the acquisition and the fair value of and the fair value cost of the acquisition the between exists year. the during the specific asset, or if for net cashflows discounting the future unit to the cash generating for net cashflows future discounted controlled entity within which benefits are expected to accrue to expected are entity within which benefits controlled assessments of the market current reflects that discount rate including projected process, of the estimation complexity of the cash inflows from other assets or groups of assets. other assets or groups from of the cash inflows All business combinations are accounted for by applying the by for accounted are combinations All business if the carrying of an is recognised value charge An impairment able group of unit is the smallest identifiable group A cash generating Impairment Impairment The carrying values of the group’s assets are reviewed at each each at reviewed assets are The carrying of the group’s values 2% 25% 20%–25% 25%–50% ttings xtures and fi line basis over their estimated useful life. useful their estimated over line basis impairment. Where assets are considered to have finite lives, lives, finite have to considered assets are Where impairment. Fixtures, fittings and equipment are stated at cost less stated equipment are fittings and Fixtures, off write the cost or so as to is calculated Depreciation software computer developed on internally Expenditure use of each asset. Freehold land is not depreciated. The annual depreciated. is land not asset. Freehold use of each they that the date of the assets from lives useful the estimated cient resources ficient resources suf feasible, and commercially technically the asset is considered impaired and is written down to the to down and is written impaired the asset is considered Other intangible assets acquired by the group are stated at at stated are the group by Other intangible assets acquired rates used for this purpose are as follows: as follows: this purpose are used for rates reviewed for impairment when events or other changes in or other when events impairment for reviewed an exists, of impairment indicator an Where recoverable. amount. recoverable finance leases are depreciated over the period of the lease. over depreciated finance leases are goodwill valuation of the asset evenly, on a straight line basis, over its over line basis, on a straight of the asset evenly, valuation Where applicable, property, plant and equipment held under applicable, property, Where amortisation is charged to the income statement on a straight on a straight the income statement amortisation to is charged account the rate of technological change and the intensity of and the intensity change of technological the rate account the software, capitalised computer use. For for available are accumulated depreciation. depreciation. accumulated is the project that is the extent applications capitalised to economic benefits. The expenditure future asset will generate estimated useful life is between two and five years. and five two is between life useful estimated for amortisation provision cost less accumulated and any estimated useful life. Useful lives are estimated taking into taking into estimated are lives Useful life. useful estimated staff direct licences, capitalised includes the cost of software costs and consultancy costs. over basis line on a straight the income statement to charged exist to complete the development and it is probable that the that and it is probable the development complete to exist circumstances indicate that the carrying values may not be not the carrying that may indicate values circumstances the amount. Where of the recoverable is made estimate amount, its recoverable carrying of an asset exceeds value Freehold buildings fi Amortisation on capitalised software development costs is Amortisation development on capitalised software Office equipment and accounting Significant continued policies Computer hardware Technical equipment Intangible assets and and assets Intangible The carrying values of property, plant and equipment are plant and equipment are The carrying of property, values Investments in subsidiaries are consolidated in the group in the group consolidated are in subsidiaries Investments in jointly controlled and interests in associates Investments influence. Equity investments are normally carried at fair value. at fair normally carried are Equity investments influence. in the existing balance credit of any the extent income to balance sheet from the date that control commences to the to commences control that the date sheet from balance believe that valuation at cost less provision for impairment is a impairment for cost less provision at valuation that believe Equity investments represent equity holdings without significant represent investments Equity open market at stated land and buildings are Freehold these are the same, after the date of acquisition or investment. the same, after or investment. of acquisition these are the date reasonable approximation of fair value. approximation reasonable of the same asset previously an impairment reverses in which case it is also in the income statement, recognised a loss arising from Any in the income statement. recognised revaluation surplus of that asset. Otherwise, surplus of that the loss is revaluation in the income statement. recognised valuation (fair value) and are revalued at 31 December each December each 31 at revalued and are (fair value) valuation entities equipment equipment subsequently increased or decreased to recognise the share the share recognise to or decreased subsequently increased in jointly controlled controlled jointly in Where an active market value is not available, the members the members available, is not value market an active Where subsidiaries subsidiaries interests and associates and Sport require freehold land and buildings to be valued at at be valued land and buildings to freehold and Sport require value. current to approximates date it ceases. it date cost. The carrying initially at recognised amount is entities are or loss if of profit or losses, or share gains recognised of total year. Directions from the Secretary of State for Culture, Media Culture, for of State the Secretary from Directions year. value open market that believe The members value. current unless the gain income, comprehensive other in directly comprehensive other to directly is charged change in fair value Any gain arising from a change in fair value is recognised is recognised a change in fair value arising from gain Any Equity investments Equity and plant Property, Investments in in Investments in Investments

been identified as the Channel 4 Board, and reportable and Board, Channel 4 been identified as the Deferred tax is provided on temporary differences between between on temporary differences tax is provided Deferred foreseeable future. future. foreseeable for: the initial recognition of goodwill; the initial recognition of of goodwill; the initial recognition the initial recognition for: for the year, using tax rates enacted or substantively enacted enacted or substantively enacted using tax rates year, the for the use of this broadcasting spectrum. the use of this broadcasting to make decisions on the allocation of resources within the decisions of resources on the allocation make to the carrying financial amounts of assets and liabilities for to the extent that it relates to items recognised directly in other other in directly recognised items to relates it that extent the to return for fulfilling public service obligations. As such, there As such, there public service fulfilling for obligations. return products and services provided are similar and where the similar and where are and services provided products manner of realisation or settlement of the carryingmanner of realisation amount of against fits will be available pro taxable future that probable profit other than in a business combination, and differences and differences other than in a business combination, profit in subsidiaries and jointly controlled investments to relating reporting purposes and the amounts used for taxation taxation reporting purposes and the amounts used for purposes. respect of previous years. of previous respect Current tax is the expected tax payable on the taxable income on the taxable tax payable tax is the expected Current which the asset can be utilised. Segments are reported in accordance with IFRS 8 ‘Operating IFRS 8 ‘Operating with in accordance reported Segments are has Decision-maker Operating the Chief Segments’, where segments have similar economic characteristics. characteristics. similar economic segments have segments follow management reporting to the Board in order in order the Board management reporting to segments follow group. Segments are aggregated only where the nature of the the nature only where aggregated Segments are group. are no imputed costs in the financial statements in respect of in costs in the financial statements no imputed are assets and liabilities, using tax rates enacted or substantively or substantively enacted assets and liabilities, using tax rates assets and liabilities that affect neither accounting nor taxable nor taxable affect neither accounting assets and liabilities that at the balance sheet date, and any adjustment to tax payable in tax payable to adjustment and any sheet date, the balance at enacted at the balance sheet date. sheet date. the balance at enacted entities to the extent that they will probably not reverse in the reverse not will probably they that the extent entities to comprehensive income, in which case it is also recognised in which case it is income, also recognised comprehensive income. comprehensive in other directly deferred tax. Tax is recognised in the income statement except except in the income statement is recognised tax. Tax deferred As noted on page 92, Channel 4 receives free spectrum in free receives Channel 4 92, on page noted As

A deferred tax asset is recognised only to the extent that it is that the extent only to tax asset is recognised A deferred Segment reporting Segment policies continued policies accounting Significant Broadcasting spectrum Broadcasting The amount of deferred tax provided is based on the expected on the expected is based tax provided The amount of deferred The following temporary timing differences are not provided provided not are temporary timing differences The following

t or loss for the year comprises current and comprises current the year fit or loss for on the pro Tax Taxation Taxation

FINANCIAL REPORT AND STATEMENTS 110 FINANCIAL REPORT AND STATEMENTS 113 ts – ts fi liabilities is the current rate of return of high quality corporate corporate of high quality of return rate liabilities is the current income in the period in which they arise. The current service arise. The current income in the period in which they bonds with similar maturity dates. The calculation is The calculation performed dates. bonds with similar maturity method. unit credit a qualified actuary using the projected by has a present legal or constructive obligation as a result of a as a result obligation or constructive legal has a present is If the effect settle the obligation. to benefits will be required Before provisions are established in relation to onerous onerous to established in relation are provisions Before ts that employees have earned in return for their for earned in return have employees benefits that future the income statement in the current period. period. current in the the income statement Obligations under the group’s defined contribution scheme are scheme are defined contribution under the group’s Obligations as incurred. statement in the income as an expense recognised past event, and it is probable that an outflow of economic an outflow that and it is probable event, past discounting the by determined are provisions material, c to the liability. specific to the risks appropriate, where Defined contribution scheme Defined benefit scheme service in the current and prior periods, discounting to prior periods, discounting and to servicecurrent in the the for The assumed discount bid price. scheme assets at rate pensions pensions obligation in respect of the plan are recognised directly in other other in directly recognised are plan the of respect in obligation of comprehensive within the statement income comprehensive in recognised on plan assets are cost and return cost, interest flects re that rate a pre-tax at cashflows future expected and, of money assessments of the time value market current contracts, impairment reviews are carried out and impairment impairment carried out and are reviews impairment contracts, the contract. to on assets dedicated recognised charges obligation under the scheme is calculated by estimating the estimating by under the scheme is calculated obligation determine its present value and deducting the fair value of fair value and deducting the value its present determine Actuarial gains and losses that arise in calculating the group’s arise losses that the group’s and in calculating gains Actuarial A provision is recognised in the balance sheet when the group the group sheet when in the balance is recognised A provision Employee bene Employee Provisions t pension scheme. The net fit pension scheme. The maintains a defined bene The group nance leases (those in which the group group the which in (those leases nance fi is reviewed on an annual basis or when the relevant contract contract or when the relevant on an annual basis is reviewed is charged accordingly. The capital elements of future obligations obligations future of elements capital The accordingly. charged is instruments for trading purposes. trading instruments for hedging instruments have been recognised in the income been recognised hedging instruments have fair value. Fair value of these derivatives is determined by by is determined of these derivatives value Fair fair value. for any of its foreign exchange hedging activity in any of the in any hedging activity exchange foreign of its any for the forward foreign exchange markets. These derivative These derivative markets. exchange foreign the forward reference to quoted market rates. The value of the derivatives of the derivatives The value rates. market quoted to reference matures. market rates. Changes in the fair value of these derivative of these derivative in the fair value Changes rates. market of changes in the fair value a result, As periods presented. Sterling, and is a net purchaser of Euros. Certain exposures to to Certain of Euros. exposures and isnet purchaser a Sterling, uctuations in exchange rates are managed by transactions in transactions managed by are rates in exchange fluctuations based on quoted value at fair stated are financial instruments recognised the income statement. in are financial instruments statement over the period of the lease in proportion to the the to proportion in lease the of period the over statement incurred. are in which they in the year statement statement as they have arisen. have as they statement instruments instruments Where the group has identified forward foreign exchange exchange foreign forward has identified the group Where assumes substantially all the risks and rewards of ownership) ownership) of rewards and risks the all substantially assumes depreciation and equipment and plant property, as treated are income the to charged is Interest liabilities. as recorded are derivative instruments within certain (embedded contracts derivative sheet at been included in the balance these have derivatives), capital outstanding. outstanding. capital the income to charged leases are operating costs arising from Assets held under under held Assets leases. The rental as operating treated leases are All other accounting Significant continued policies Derivative financial financial Derivative Leases The group transacts in a number of currencies as well as well as in a number of currencies transacts The group financial hold or issue derivative does not The group treatment apply hedge accounting sought to has not The group balance sheet date are translated at the foreign exchange rate rate exchange the foreign at translated are sheet date balance for doubtful accounts. accounts. doubtful for translation are recognised in the income statement. recognised are translation Other financial assets comprise deposits of more than three than three compriseOther financial assets deposits of more balances instruments with debit and financial months duration and comprise cash balances Cash and cash equivalents placement. ruling at that date. Foreign exchange differences arising on differences exchange Foreign date. that ruling at equivalents equivalents and are stated at fair value. fair value. at stated and are assets and liabilities denominated in foreign currencies at the at currencies in foreign assets and liabilities denominated deposits of less than three months duration from the date of the date from months duration deposits of less than three exchange rate ruling at the date of the transaction. Monetary of the transaction. the date ruling at rate exchange Other financial assets assets financial Other cash and Cash Trade and other other and Trade receivables Foreign currency currency Foreign Transactions in foreign currencies are translated at the foreign the foreign at translated are currencies in foreign Transactions Trade receivables are reflected net of an estimated impairment impairment net of an estimated reflected are receivables Trade

longer exist and there has been a change in the estimates used has been a change in the estimates and there longer exist Inventories are valued at the lower of cost and net realisable of cost and net realisable the lower at valued are Inventories In respect of other assets, an impairment charge is reversed isreversed charge assets, an impairment of other In respect incurred up to the balance sheet date after making provision after sheet date the balance making provision up to incurred in fair value. Such a gain is recognised in the income statement income statement in the is recognised Such a gain in fair value. buildings is reversed in the event of a subsequent increase of a subsequent increase in the event buildings is reversed Film rights are amortised in the Film rights are statement in the income lm rights are stated at direct cost incurred up to up to cost incurred direct at stated film rights are Developed Development expenditure is included in broadcast programme programme is in broadcast included expenditure Development lms which are unlikely to be transmitted be transmitted to unlikely and films which are programmes for ultimate revenue, after provision for any anticipated shortfall. anticipated any for after provision revenue, ultimate the balance sheet date. Provision is made for any excess over over excess any for is made Provision sheet date. the balance the and the revenues of the film held in inventories the value the income statement. the income statement. to determine the recoverable amount. the recoverable determine to realisable value. realisable Other inventories principally comprise DVDs held within the comprise DVDs principally Other inventories proportion that the revenue in the year bears to the estimated the estimated to bears in the year proportion the revenue that revenues and sales forecasts by territory. territory. by and sales forecasts revenues programme suppliers. suppliers. programme which are written off over more than one transmission in line than one transmission more off written over which are benefits. or other revenue with expected rst transmission, except for certain feature certain for feature except transmission, offwritten on first when there is an indication that the impairment charge may no may charge the impairment is that an indication when there lm is anticipated to earn. The main assumptions employed to to earn. The main assumptions employed to film is anticipated films, sports rights and certain costs of series, the acquired

lm rights are stated at direct cost direct at stated and film rights are Programme value. other inventories inventories other lm rights after charging any expenditure that is not is that not expenditure any and film rights after charging estimate future revenues are minimum guaranteed contracted contracted minimum guaranteed are revenues future estimate expected to lead to a commissioned programme directly to to directly a commissioned programme to lead to expected ned as payments made or due to or due to made cost is defined as payments or sold. Direct or revaluation reserve if reversing previous impairments. previous if reversing reserve or revaluation An impairment charge in respect of goodwill is not reversed. reversed. of goodwill is not in respect charge An impairment An impairment charge in respect of freehold land and of freehold in respect charge An impairment 4Rights segment, and are stated at the lower of cost and net of cost and the lower at stated 4Rights segment, and are

policies continued policies accounting Significant

Programme rights and and rights Programme Reversal of impairments of Reversal The cost of broadcast programme and film rights is wholly programme The cost of broadcast

FINANCIAL REPORT AND STATEMENTS 112 FINANCIAL REPORT AND STATEMENTS 115 £m £m — (2.0) £m £m £m £m Other Eliminations Group Other Eliminations Group * * £m £m Media Media

£m £m £m £m (1.9) 0.3 4 4Channels 4Rights Future 4 4Channels 4Rights Future

— — — 1.9 — — 1.9 — — 0.9 7.0 2.2 (10.1) — £m £m 1.4 — — — 0.8 — 2.2 5.4 — — — — — 5.4 2.5 — — — — — 2.5 6.2 — — — 0.2 — 6.4 10.5 0.1 0.3 — 0.2 — 11.1 (2.2) (0.1) 0.3 (0.2) 0.2 (15.6) 54.2 11.7 0.7 0.6 — 51.6 (12.7) (0.2) — (0.2) — — (13.1) 575.1 181.3 44.8 33.1 6.1 (10.1) 830.3 (59.4) 53.5 11.5 (2.3) 0.6 — 3.9 (61.6) 53.4 11.8 (2.5) 1.1 — 2.2 (43.8) (0.7) (0.2) (3.0) — — (47.7) 575.1 181.3 43.9 26.1 3.9 — 830.3 394.5 8.1 39.6 (21.4) (4.0) — 416.8 583.0 39.4 61.9 5.3 59.3 (85.4) 663.5 (188.5) (31.3) (22.3) (26.7) (63.3) 85.4 (246.7) Channel Channel 2009

2009

eet December

ce sh December

ended

venue at

Share of profit of investments accounted for using the equity method net tax of Profit/(loss) before tax Income tax expense Profit for the year — Other information Capital additions and (notes 11) 10 — Depreciation (notes 10) Amortisation (note 11) Impairments (notes 9 and 10) — Reversal impairment of (note 8) — 0.3 — 0.3 financial to the Notes continued statements Year Re External sales Inter-segment sales As Balan and and enhance programme which exploit activities platform on 4iP and cross expenditures content and other Programme been results have The 2009 Media’ in 2010. ‘Other’to ‘Future from reclassified online distribution channels were across content basis on which the business is managed and monitored. revised the reflect to basis on a consistent restated revenue Total Gross profit/(loss) Other operating expenditure Operating profit/(loss) Financial income Financial expense Net finance income/(expense) Segment liabilities Net assets/(liabilities) Segment assets 1. Segment reporting (continued) reporting Segment 1. * £m £m £m £m £m £m Other Eliminations Group * £m £m Media Other Eliminations Group Media

£m £m £m £m (15.4) 38.6 4 4Channels 4Rights Future 4 4Channels 4Rights Future

— — 1.1 5.7 2.2 (9.0) — £m £m 1.9 — — — 1.2 — 3.1 1.5 — — — 0.8 — 2.3 3.6 — — 0.3 0.3 — 4.2 5.0 — — 0.8 — — 5.8 1.2 0.3 0.3 (0.1) 0.1 — 1.8 (7.7) 54.0 7.4 (3.8) (0.6) — 49.3 19.9 55.7 7.9 — 1.8 — 85.3 16.7 0.3 0.3 — 0.1 — 17.4 (6.5) 54.3 7.7 (3.9) 2.4 — 54.0 (15.5) — — (0.1) — — (15.6) (27.6) (1.7) (0.5) (3.8) (2.4) — (36.0) 391.7 46.9 45.1 (21.5) (3.9) — 458.3 641.6 204.6 47.8 44.3 5.9 (9.0) 935.2 641.6 204.6 46.7 38.6 3.7 — 935.2 626.2 75.6 76.1 9.5 129.5 (199.3) 717.6 (234.5) (28.7) (31.0) (31.0) (133.4) 199.3 (259.3) Channel Channel 2010

2010

eet December

andnts 11) (notes 10 9,

me ce sh December

ended

venue at

Income tax expense Profit for the year Other information Capital additions and (notes 11) 10 Depreciation (note 10) Amortisation (note 11) Impai Balan

Inter-segment sales revenue Total Gross profit Other operating expenditure Operating profit/(loss) Financial income Financial expense Net financial income/(expense) Share of profit of investments accounted for using the equity method net of tax Profit/(loss)before tax — — — As — 2.9 — 2.9 External sales Re Reconciliations to group profit for the year and to group net assets at the balance sheet date are included in the tables below. included in the tables are balance sheet date at the net assets to group and year for the profit group to Reconciliations Approximately 2% of the group’s revenues (2009: 2%) are attributable to external customers outside the UK and these are are outside the UK and these customers external to attributable (2009: 2%) are revenues 2% of the group’s Approximately presented. separately not therefore Revenues from transactions with two individual external customers each comprising more than 10% of the group’s revenues in 2010 revenues group’s than 10% of the comprising more each customers individual external with two transactions from Revenues all media buying agencies are major customers million and £95 million). The group’s £99 million (2009: £97 £100 million and were Media segments. the Channel 4, 4Channels and Future to attributable are and these revenues Inter-segment pricing is determined on an arm’s length basis. There are no segments selling primarily or exclusively to other other to selling primarily or exclusively no segments are There length basis. on an arm’s pricing is determined Inter-segment segments of the group. Year Segment results, assets and liabilities include items directly attributable to a segment, along with certain costs which are allocated a segment, along with certain allocated to attributable costs which are directly assets and liabilities include items Segment results, required under arrangements reviewed policies which are cost allocation with the group’s in accordance on an equitable basis the segments. across fully allocated are All costs and revenues 146). (page Act 9 of the Communications under Schedule Segments are aggregated where economic characteristics and the nature of the products and services are similar and the Board the Board similar and and services are of the products and the nature economic characteristics where aggregated Segments are the are The segments reported management performance resources. and allocating when evaluating them in aggregate considers major been no have there the same and set remain thresholds as the quantitative years, in previous same as those reported and services and financial products activities, Summaries of the principal during the year. structure the group changes to and 95. 93 92, on pages within the Report of the members provided segment are performance each for 1. Segment reporting Segment 1. in a manner measured Segments’. The segments are with IFRS 8 ‘Operating in accordance shown The reportablegments are se (pages Decision-maker Operating the Chief which is considered Board, the by with the management reportsconsistent reviewed are The segments profit. pre-tax to presented are sales and results intersegment any include Segment revenues 148-149). within the group. resources allocate to how when deciding perspective and regulatory a product from principally considered financial statements financial Notes to the to the Notes Segment assets Segment liabilities Net assets/(liabilities)

FINANCIAL REPORT AND STATEMENTS 114 FINANCIAL REPORT AND STATEMENTS 117 2009 2009 £000 £m — (1.9) 72 63 67 63 73 82 54 64 86 27 £m 0.9 1.3 1.0 0.2 1.3 1.4 3.0 3.9 0.8 4.8 2.6 2.1 2.3 2.2 4.2 5.4 146 201 £000 2010 2010 494 504 286 292 208 212 10.3 5.3 (16.2) 4.3

otherTotal services Auditors’ remuneration the Channel to as auditors who acted auditors the group’s to paid was (2009: £21,000) services £21,300 the above to In addition Plan. Pension Staff Television Four of those audits are in respect paid Plan and the fees Pension Staff Television the Channel Four to The appointment of auditors the management of the group. independently from of the Plan, who act the Trustees by agreed Members’ remuneration (page 151) Operating lease rentals (note 19) income its own presented 2006 Channel 4 has not Act of the Companies section 408 by provided with the exemption Consistent a loss income statement, in the consolidated recorded million) million (2009: £0.3 year of £38.6 for the Within the profit statement. Channel 4. from million) results million (2009: £46.5 of £5.7 remuneration Auditors’ were: the auditors by of services provided in respect Fees Research and development (page 100)

All other services Restructuring costs Services relating corporate to finance transactions financial to the Notes continued statements Impairment of fixtures, fittings and equipment and internally developed software and (notes 11) 10 Amortisation of intangible assets (note 11) Impairment of investments (notes 9) Impairment of freehold land and building (note 10) Reversal impairment of of investment in UK LLP VOD (note 8) Net movements in provisions for onerous contracts (note 17) Amounts receivable by auditors and their associates in respectof: Audit of financial statements of subsidiaries pursuant legislation to Other audit related and assurance audit Total and assurance Other services relating taxation to 3. Operating profit profit Operating 3. includes: expenditure Other operating Depreciation of property, plant and equipment (note 10) Audit of these financialstatements — 2009 £m of

— 1.9 £m 3.4 (6.2) 2010 (3.1) (6.4) (0.7) (2.6) (2.1) (6.5) (7.6) (26.5) (27.3) (36.0) (47.7)

of Cost

programme Cost and

costs Indirect

regulatory Transmitter — — — 0.5 36.7 2.7 39.9 — — — — — — 4.1 — — 0.2 4.1 30.1 2.8 33.1 — — 0.3 0.2 4.4 0.6 5.5 £m £m £m £m £m £m £m 6.1 — 0.9 14.9 9.2 1.3 32.4 (7.9) — — — (2.2) — (10.1) (6.8) — — — (2.2) — (9.0) 11.6 — 1.8 16.9 12.2 1.8 44.3 93.9 — 37.5 4.0 6.5 7.0 148.9 78.2 — 31.0 4.5 5.7 7.7 127.1 other

579.9 13.5 88.1 43.2 83.7 41.5 849.9 471.9 18.8 37.5 22.0 20.6 19.9 590.7 481.2 13.5 48.8 21.8 26.4 30.0 621.7 548.3 18.8 69.7 41.8 67.8 32.3 778.7 content Analogue Digital costs sales marketing Total and Programme * *

efficiency of the the operational to improve year undertaken during the restructuring initiatives the costs reflect Restructuring management group. reducing the senior the costs of reflected these costs principally In 2010 group. Other administrative expenses Net movements in provisions for onerous property leases Impairments and 11) (notes 10 9, Reversal impairment of of investment in UK LLP VOD (note 8) Charge for doubtful debts Depreciation and amortisation and (notes11) 10

Restructuring costs

4Channels 4Rights Future Media 2010 Channel 4

2. Total operating expenditure operating Total 2. and sales transmission Cost of statements continued statements Other financial to the Notes Eliminations Group continuing operations 2009 Channel 4 4Channels 4Rights Future Media

Other operating expenditure Other operating Other and and enhance programme which exploit activities platform on 4iP and cross expenditures content and other Programme been results have The 2009 Media’ in 2010. ‘Other’to ‘Future from reclassified distribution online channels were across content basis business on which the is managed and monitored. revised the reflect to basis on a consistent restated Eliminations Group continuing operations

FINANCIAL REPORT AND STATEMENTS 116 FINANCIAL REPORT AND STATEMENTS 119 2009 £000 2009 £000 2009 £m 60 63 £m 1.8 2.0 3.8 — 189 175 229 200 £000 £000 2010 2010 2010 17.4 11.1 (0.1) (0.2) (0.5) (0.3) (2.0) (1.6) 11.8 9.1 (0.2) (0.6) 1,708 1,663 (12.8) (10.4) (15.6) (13.1) 1,957 1,901

Interest on pension scheme liabilities (note 20) Change in fair value of financial assets Foreign exchange loss Financing costs Financial expense year on cash during the Sterling against of the US dollar and Euro effect of the depreciation the losses reflect exchange Foreign and Euros. in US dollars holdings denominated on certain agreements. by the group content costs borne interest Financing costs reflect Financial income Unwinding of discount on provisions (note 17) Expected return on plan assets (note 20) Reversal unwinding of of discount on provisions (note 17) financial to the Notes continued statements Staff loans outstanding at 31 December were as follows: were December 31 outstanding at loans Staff Other employees: Channel 4 Other businesses 4. Employee expenses and information (continued) information and expenses Employee 4. as follows: was and hospitality expenditure subsistence Travel, Members Season ticket loans members. to no loans were There income/(expense) finance Net 5. year comprised:recognised in the Net finance income Interest receivable on short term deposits 4

Number 2009 Channel 2009 £m 4

51 51 16 17 37 28 32 35 22 23 29 28 29 29 56 32 24 24 £m 3.7 3.3 0.4 0.3 4.0 4.6 316 313 411 383 671 664 132 112 727 696 727 696 727 696 109 106 432 420 108 97 295 276 138 146 2010 2010 36.5 34.2 Number Channel

Group 2009 £m £m 5.5 5.0 0.5 0.3 4.4 4.9 2010 49.9 47.3 60.3 57.5 44.6 42.4

Group

(2009: 694). 731 was the year for Closing headcount Female Male Contract staff Group total Permanent employees Other 4Rights Future Media 4Channels

Finance, human resources and facilities management Marketing and insight Corporate and strategy Information systems Corporate affairs and press office Advertising and sponsorship sales Transmission and engineering Channel 4 Programme commissioning Aggregate gross salaries

The direct costs of all employees, including members, appear below: including members, costs of all employees, The direct 4. Employee expenses and information and expenses Employee 4. in the report on bonuses, is provided salaries and performance-related including remuneration, of members’ A detailed analysis 150-153. on pages remuneration members’ statements continued statements financial to the Notes

The average number of employees, including executive members, was as follows: was members, including executive number of employees, The average In addition to the above, in 2010 £2.6 million costs were expensed to the income statement in respect of restructuring initiatives to to initiatives of restructuring in respect the income statement to expensed million costs were in 2010 £2.6 the above, to In addition million). £2.1 (2009: group within the efficiency operational increase directTotal costs employment of Employer’s national insurance contributions Employer’s defined benefit pension contributions (note 20) Employer’s defined contribution pension contributions (note 20)

FINANCIAL REPORT AND STATEMENTS 118 FINANCIAL REPORT AND STATEMENTS 121 4

% Ownership

Channel 2009 £000

4 1 1

£000 2010 shares

ordinary

Channel Issued £1

1,000 1,000 1,000 100 1,000 100 100 1 100 1 100 100

Film distribution Digital channel Digital channel Digital Radio channels

Activity * Digital Radio channels * Digital channel * financial to the Notes continued statements 4 Ventures Ltd is a 100% owned subsidiary of Channel 4. Its principal activities include the activities of the 4Channels, 4Rights and of the 4Channels, subsidiary the activities include activities is a 100% owned of Channel 4. Its principal Ltd 4 Ventures 95). Media segments (page Future either companies following capital of the than 50% of the issued share more owned Ltd 4 Ventures sheet date the balance At Britain: in Great incorporated of which was each or indirectly*, directly FilmFour Ltd 7. Investments in subsidiaries in Investments 7. Subsidiaries December was: 31 at The cost of investments 4 Ventures Limited Life One Broadcasting Ltd BroadcastingLife Two Ltd Life Showcase Ltd Channel 4 Radio Ltd 9). Ltd (note Pictures its film libraryto Protagonist sells rights from Ltd FilmFour licences to own Ltd, Showcase and Life Ltd Broadcasting Two subsidiaries, Life wholly owned and its two Ltd Broadcasting One Life 11). (note the Sky platform channels on three broadcast wind up these entities. to intention it is the members’ trading, not are Services and Channel 4 Radio Ltd Ltd Channel 4 Radio As

Channel 4 Radio Services Ltd 2009 £m 2009 £m % £m £m £m 1.0 (1.3) 1.6 0.8 0.2 0.1 2010 2010 (1.7) 6.6 17.0 2.7 14.4 3.5 (0.2) (0.4) 15.4 1.9 14.2 3.1 (1.7) 6.6

2009 2009

— — (0.6) (0.3) 1.4 2.8 1.6 0.8 55.6 3.0 15.4 1.9 54.0 2.2

38.6 0.3 % £m 2010 2010 28.0 15.6 28.0 0.8

30.6 17.0 89.5 2.7

Income tax expense Income tax of investments accounted for using the equity method Reconciliation of effective tax rate effective of Reconciliation Corporation tax is charged at the standard UK rate of 28.0% for the year (2009: 28.0%). the year for of 28.0% UK rate the standard at tax is charged Corporation Share of income tax of investments accounted for using the equity method incomeTotal tax expense Income tax expense Prior year Deferred tax recognised directly in other comprehensive income comprehensive Deferred tax recognised directly in other in the income and is shown comprehensive in other directly tax has been recognised in deferred movement The following income: of comprehensive statement Non-taxable distribution (Over)/under provided in prior periods Income tax expense Current tax assets and liabilities in the amount of income tax payable million) represents tax asset of £0.2 million (2009: current tax liability of £6.4 The current 14 and 16). and prior periods (notes current of respect Deferred tax: origination and reversal of temporary differences Current year Adjustment for prior years Deferred tax recognised in other comprehensive income Relating employee to benefits

Profit after tax

Current tax: Current year

6. Income tax expense tax Income 6. year and comprises: for the profit on the taxable is based charge The taxation statements continued statements financial to the Notes

Effects of: Non-deductible expenses Profit excluding income tax Income tax using the domestic corporation tax rate

FINANCIAL REPORT AND STATEMENTS 120 FINANCIAL REPORT AND STATEMENTS 123 Expenses

term

term Current Long

£m £m £m £m £m £m 0.7 — (0.8) — 0.3 (0.4) 0.1 — (0.3) — 1.1 (1.3) 1.3 0.1 (1.1) — 3.0 (2.2) 1.2 0.1 (0.7) — 4.0 (3.3) 0.2 — (0.2) (0.2) 1.3 (1.3) 11.2 0.6 (6.5) — 28.3 (23.4) assets assets liabilities liabilities Revenue 15.9 0.7 (9.4) (0.2) 39.8 (27.0) 14.4 0.6 (8.1) — 35.5 (23.5) 13.2 0.7 (8.3) — 33.7 (28.4) Current Long its estimated useful life. life. useful its estimated financial statements. financial statements. years). This amount is included within the carrying value of investments accounted for using the equity method. for accounted This amount is within the carrying included of investments years). value financial to the Notes continued statements Protagonist Pictures Ltd Big Freeze Ltd 8. Investments accounted for using the equity method method equity the using for accounted Investments 8. (continued) of continuing investments information Summary annual financial 2010 Box Television Ltd of LondonTaste Ltd Big Freeze Ltd 2009 Box Television Ltd of LondonTaste Ltd

The trademark acquired as part of the investment in Taste of London Ltd is amortised over ten years from acquisition in line with acquisition from years ten is amortised Ltd over of London Taste in as part of the investment acquired The trademark be included within the group’s to of joint ventures in respect no contingent liabilities and no capital commitments are There The broadcast licence acquired as part of the investment in Box Television Ltd is amortised over the duration of the licence (eight the duration is amortised Ltd over Television in Box as part of the investment acquired licence The broadcast following the partial buyback of shares the partial of shares buyback following Equity Investments

UK VOD LLP UK VOD Big Freeze Ltd Big Freeze Ltd Popworld Pictures Ltd Protagonist Box Television Ltd Television Box Kangaroo, the online video on demand service jointly developed by BBC Worldwide, ITV plc and Channel 4, was prohibited by the by prohibited ITV plc and Channel 4, was Worldwide, BBC by the online video on demand service jointly developed Kangaroo, sold Kangaroo, for the technology platform developing the joint venture LLP, Competition Commission 2009 UK VOD in 2008. During on 11 January dissolved 2011. liability partnership was The limited Ltd. Arqiva its assets to to formed venture Ltd, a Freeze of Big capital of the share 25% representing of £1, 25 ordinary shares reflects The investment which Sports Ltd, are Vision (International) shareholders The other sport snow and music events. and exploit produce develop, of the shares. Plus Plc, which holds 25% and Boomerang holds 50% of the shares, of the transfer in 2008 following for fully provided was This investment Ltd. capital of Popworld holds 29% of the share The group 19 Entertainment to Ltd. the assets and liabilities of the company to reclassified was Ltd Pictures in Protagonist investment The group’s The investment reflects 27,250 ordinary shares of £1 representing 50% of the share capital of Taste of London Ltd. The other Ltd. The London of Taste capital of 50% of the share representing of £1 ordinary shares 27,250 reflects The investment Ltd. Events is Brand shareholder Management has approved the forecast on which the cashflow analysis has been based and believes that there are currently currently are there that based and believes has been analysis which the cashflow on the forecast Management has approved an impairment where a level to down Box in use for the value reduce which would or discount rate changes in revenues no likely arise. would An impairment review was carried out by estimating the future expected cashflows for Box until 2015, using a pre-tax discount using a pre-tax until 2015, Box for cashflows expected the future estimating carried out by was review An impairment and comprising segments a television for its commercial cost of capital estimated the group’s of 10% (2009: 11%) reflecting rate of 0.3% rate and a beta of 1 (2009: 1), and a growth 7.0%) (2009: of 6.5% (2009: 4.2%), an equity risk premium of 3.5% rate risk-free on viewing in music potential term of the long view cautious reflecting management’s to perpetuity, years after five (2009: 2.5%) to the carryingvalue of the was then compared to the group accruing of the cash flows value The present television. commercial as a result. required was sheet. No impairment held on the balance investment Impairment tests on the investment in Box are carried out annually or if indications arise of a possible impairment. The recoverable recoverable The impairment. possible arisea of indications if or annually out carried are Box in investment the on tests Impairment in use. on their value based determined are and intangible assets in Box amounts of the goodwill The investment reflects 500 ordinary shares of £1, representing 50% of the share capital of Box Television Ltd (Box). The other The Ltd (Box). Television Box of capital 50% of the share representing of £1, ordinary 500 shares reflects The investment is Media Ltd. Bauer Consumer shareholder 8. Investments accounted for using the equity method equity the using for accounted Investments 8. statements continued statements financial to the Notes and redemption of loan notes by Protagonist during the year (note 9). (note during the year Protagonist by notes of loan and redemption Taste of London Ltd of Taste

FINANCIAL REPORT AND STATEMENTS 122 FINANCIAL REPORT AND STATEMENTS 125 financial to the Notes continued statements 8. Investments accounted for using the equity method method equity the using for accounted Investments 8. (continued) in Great of which is incorporated each cost-sharing organisations, not-for-profit, are joint ventures of the group’s The following in the appropriate recognised are of these organisations the funding requirements to makes the group that Britain. Contributions relate. which they in the period to line in the income statement Digital 3 and 4 Ltd owns Ltd capital. ITV Network 50% of the share representing in Digital 3 and 4 Ltd, A class ordinary £1 shares Channel 4 holds 1,000 Channel 4 digital terrestrial the Channel 3 and operate to Ofcom a licence by granted has been 4 Ltd 50%. Digital 3 and the other as acts The company £1,000. to amounted net assets of Digital 3 and 4 Ltd of the share Channel 4’s 2010, December 31 At multiplex. its shareholders. an agent for Services Ltd DTV Grid National capital. The BBC, 20% of the share representing Services Ltd, in DTV ordinary £1 shares Channel 4 holds 6,000 the marketing for responsible is the company Services Ltd 80%. DTV the remaining own Ltd BSkyB plc and ITV Network Wireless, TV network. digital terrestrial Freeview (DMOL) Ltd Operators Multiplex DTT the are members The other in Digital 3 & 4 Ltd. is via its share a member The group guarantee. by limited DMOL is a company plc and SDN Ltd. Grid Wireless National BBC, (BARB) Ltd Board Research Audience Broadcasters’ Channel 5 Broadcasting Ltd, ITV Channel 4 is a joint member along with the BBC, Network guarantee. by limited is a company BARB BSkyB plc and the IPA. Ltd, Ltd Thinkbox ITV GMTV plc, Ltd, Ltd, capital. Channel 5 Broadcasting of the share 14% representing ordinary £1 shares Channel 4 holds 3,000 is the television Ltd Thinkbox of the shares. hold the remainder Solutions Ltd Brand and Viacom Broadcasting BSkyB plc, Turner broadcasters. the main UK commercial body for marketing Clearcast Ltd BSkyB plc, Ltd, capital. ITV Network of the share 16.7% representing Ltd, in Clearcast Channel 4 holds one ordinary £1 share 83.3%. Clearcast the remaining own Ltd International Entertainment Networks and Turner GMTV Ltd Ltd, Channel 5 Broadcasting advertisements. of television and clearance examination the pre-transmission for is responsible Ltd Unit Ltd Broadcasting Parliamentary four owns capital. The BBC of the share 11.1% representing Unit Ltd, Broadcasting in the Parliamentary Channel 4 holds one share one share. own each (Leeds) Nominees Ltd Square and Park Ltd BSkyB plc, Channel 5 Broadcasting Ltd, ITV and Network shares venture joint this to payable fees Service venture. joint following the of costs operating the towards contributed group the addition, In relate. they which to period the in statement income the in recognised also are agreement shareholder the of terms the under Tem Pro Canvas (formerly TV Ltd in YouView a 14.3% equity stake acquired Corporation Channel 4 Television 2010, On 9 September based and enabling technologies, standards a set of software support and promote develop, to incorporated a joint venture Ltd), of the The value of competing TV platforms. the development for and IPTV which allow technologies, of DTT on a convergence ITV the BBC, Broadcasting are shareholders The other each. of £0.01 600 shares million representing less than £0.1 was investment Ltd. plc and Arqiva Group Telecom Talk plc, Talk BT Ltd, Broadcasting Channel 5 Ltd, YouView TV Ltd YouView 2009 £m — 0.1 — (0.1) — — — (1.9) — 1.9 — — — 0.2 £m 0.1 0.2 1.5 1.6 1.3 1.5 0.2 — 2010 (0.1) — (1.8) (1.2) 27.3 28.6 (3.6) (1.5) (0.2) — (0.2) (0.3) 26.3 27.3 4.4 1.4

Ltd

Pictures

LLP

London

Television

VOD

Share of dividends received Distribution carryingTotal value December at 31 Reclassification equity to investments Share of post acquisition losses, net of income tax Reversal losses of Repayment of loan and shares Carrying value 1 January at Protagonist carryingTotal value December at 31 Reversal impairment of Carrying value 1 January at carryingTotal value December at 31 UK Share of post acquisition profits, net of income tax and amortisation Share of dividends received Taste Carrying value 1 January at carryingTotal value December at 31 Share of post acquisition profits, net of income tax Amortisation

Box Carrying value 1 January at (continued) the equity method comprise: using for accounted Investments 8. Investments accounted for using the equity method method equity the using for accounted Investments 8. statements continued statements financial to the Notes

FINANCIAL REPORT AND STATEMENTS 124 FINANCIAL REPORT AND STATEMENTS 127 Group £m

and

Other £m Fixtures, fittings equipment 4

Channel £m

and

Channel Fixtures, £m

— 1.7 — 1.7 — — 4.2 (16.4) — (10.7) (16.4) 4.2 (10.7) 1.7 16.4 — (7.2) 0.8 — 103.7 (17.9) — 103.7 5.0 — 1.4 109.7 — — 1.4 109.7 — 109.7 103.7 — — 109.7 (15.1) — — 0.4 (15.1) — (8.8) 109.7 — 1.4 15.1 89.1 (8.8) 0.4 109.7 (7.2) 89.1 — 0.2 (16.0) 8.7 0.6 97.8 £m 0.7 2.9 3.6 0.6 4.2 and fittings 0.8 4.6 5.4 — 5.4

(1.5) — (1.5) — (1.5) (7.0) — (7.0) — (7.0) (0.7) — (0.7) — (0.7) (0.8) — (0.8) — (0.8) 49.0 116.1 165.1 — 165.1 49.0 12.4 61.4 — 61.4 42.0 117.8 159.8 — 159.8 42.0 8.1 50.1 — 50.1 40.5 94.9 135.4 10.0 145.4 40.5 5.8 46.3 1.3 47.6 42.0 117.8 159.8 — 159.8 42.0 8.1 50.1 — 50.1 building equipment Total Total land Freehold Channel

financial to the Notes continued statements 10. Property, plant and equipment and plant Property, 10. Cost or valuation At 1 January 2009 Additions Revaluation DecemberAt 31 2009 At 1 January 2010 Additions Transfer of assets Disposals Revaluation DecemberAt 31 2010 Depreciation At 1 January 2009 Charge for the year Impairment Revaluation DecemberAt 31 2009 At 1 January 2010 Charge for the year Transfer of assets Impairment Disposals Revaluation DecemberAt 31 2010 Net book value At 1 January 2009 DecemberAt 31 2009 At 1 January 2010 DecemberAt 31 2010 assets held under finance no material were There 19. detailed in note plant and equipment are property, purchase Commitments to security (2009: none). been pledged for No assets have sheet date. the balance leases at to relation down in to a number of assets written relates and equipment in 2010 principally fittings of fixtures, The impairment amount, their recoverable exceeded cost value historical which the depreciated for agreements certain property rental onerous the for market is no active there sell. As less costs to in use and the fair value amount is the higher of value recoverable where other to has been charged amount. The impairment the recoverable estimate in use has been used to value assets impaired, 2). (note within the income statement expenditure operating book value. at Limited 4 Ventures Channel 4 to from transferred During 2010 assets were freehold property of Valuation valued 2TX, was SW1P London Road, Horseferry 124 at centre comprising the office and transmission property, The freehold Manual of and Valuation with the Appraisal in accordance Estate, Real BNP Paribas valuers external December 2010 by 31 at which the members value, of open market on the basis valued The property was Surveyors. Institution of Chartered The Royal value. current to approximates believe on the open market charged depreciation million). After million (2009: £42.0 £40.5 this property for was value The open market 3). (note the income statement to has been charged million impairment million), a further £0.8 December 2009 (£0.7 31 at value . 2009 £m — 0.5 £m 0.1 — 2.5 2.2 (1.0) (0.2) . On 10 August . On 10 August 2010 Equity investments

1.6 2.5

Investments accounted for using the equity method

Protagonist Pictures Ltd Protagonist Espresso Broadband Ltd Espresso Broadband Other The group’s investment in Protagonist was previously held in held previously was in Protagonist investment The group’s During 2010, certain institutional shareholders sold their stake in Espresso to other shareholders at a price below the carrying a price below at shareholders other to in Espresso sold their stake certain institutional shareholders During 2010, which £1.5 million, million to £0.6 by be impaired to considered was in Espresso equity investment the group’s a result, As value. fair value. represent to is considered capital of the share 15% representing £1, of ordinary shares 59,064 reflect the group held by million of the equity investments £0.1 and Nandv 15%) (each Media Services Ingenious Ltd Ltd, Holdings Vertigo are shareholders The other Ltd. Pictures of Protagonist (55%). Ltd Media (Ireland) December At 31 a 10% equity holding in Espresso to related December 2009 31 at the group held by million of the equity investments £2.1 2007. held since March programming, of digital education and distributor a producer Ltd, Broadband Reclassification from investments accounted for using the equity method Impairment Additions

At 1 January 9. Equity investments Equity 9. held comprise: investments Equity statements continued statements financial to the Notes The group further holds investments in School of Everything Ltd, MyBuilder Ltd, AudioBoo Ltd and Mobile IQ Ltd. Certain equity Mobile IQ Ltd. and Ltd AudioBoo MyBuilder Ltd, Ltd, of Everything in School furtherThe group holds investments submissions during new closed to fund, which was digital innovation Channel 4’s 4iP, by made were the group held by investments million a £0.4 in full, giving rise to down been written held have of the fund, the investments the closure Following the year. charge. impairment 2010, Protagonist bought back 72,186 shares from each of its shareholders (Vertigo Holdings Ltd, Ingenious Media Services Ltd and Media Services Ingenious Ltd Holdings Ltd, (Vertigo of its shareholders each from shares 72,186 bought back Protagonist 2010, also redeemed the same time, Protagonist At Limited. Nandv Media (Ireland) to shares 216,579 and re-issued Ltd) 4 Ventures was a small gain buyback, of the share a result As original shareholders. of its three each from notes £82,500 of the loan to reclassified was the group held by investment 15% and the remaining Ltd in 4 Ventures recognised

FINANCIAL REPORT AND STATEMENTS 126 FINANCIAL REPORT AND STATEMENTS 129 10

£m

Dec

2009 £m Net 2009 £m £m £m Net 1.1 1.2 5.9 5.7 9.4 12.5 9.3 12.0 1.3 1.4 0.2 0.6 8.3 8.3 2.2 2.5 2010 2010 £m (0.8) (1.2) joint Balance

£m sed other Recognised

Liabilities 2009 £m — (0.1) — — — — £m 2010 (1.9) (2.7) (1.7) (2.4) (2.7) (4.0) Recogni in (0.8) (1.3) 11.0 14.4 (0.8) (1.2) £m Liabilities income income ventures at

£m ssets Recognised comprehensive in

10 in

£m 0.6 (0.4) — — 0.2 2.5 (0.3) — — 2.2 (1.2) 0.4 — — (0.8) (2.4) 0.5 — 0.2 (1.7) 14.4 (1.7) (1.7) — 11.0 12.5 (1.4) (1.7) — 9.4 12.0 (1.2) (1.7) 0.2 9.3 Jan

A 2009

1 Balance

— — £m at 9.4 12.5 0.2 0.7 0.2 0.3 2.2 2.5 2010 11.8 15.7 12.0 16.0 Assets andnt equipment rred tax assets/(liabilities) ant and equipment erred tax assets/(liabilities) 7% with effect from 1 April 2011. from 7% with effect on of freehold land and buildings ount of deferred tax recognised in the income statement in respect of each type of temporary timing difference is as follows: as is difference timing temporary of type each of respect in statement income the in recognised tax deferred of ount Unrecognised deferred tax assets include capital losses carried forward that the group is not yet able to utilise. A deferred tax utilise. A deferred able to yet is not the group that tax assets include capital losses carried forward deferred Unrecognised temporary which the deductible against available will be profit taxable that it is that probable the extent to asset is only recognised periods). accounting or in later can be utilised (either now difference differences during the year in temporary Movements am The Carried forward trading losses Property, pla Intangible assets – internally developed software Employee benefits Other short term timing differences Channel 4 deferred tax assets/(liabilities) Other short term timing differences Valuati Carried forward capital losses assetsTax Group defe tax rate. of the change in the deferred million as a result tax asset of £0.4 in the deferred a reduction includes The movement

financial to the Notes continued statements Channel 4 deferred tax assets/(liabilities) Other short term timing differences Employee benefits Intangible assets – internally developed software d tax assets and liabilities are recognised at 27% (2009: 28%). The change in rate reflects the change in the corporation tax the change in the corporation reflects 28%). The change in rate (2009: 27% at recognised are d tax assets and liabilities Deferre 2 to rate the with 24%, to 28% from rate tax corporation UK main the in reduction phased a announced Government UK the year, the During are liabilities and assets tax Deferred 1010). July 20 on enacted substantively (and 2011 April 1 from effect taking reduction 1% first the on based settled, is liability the or realised is asset the when period the to apply to expected is that rate tax the at measured tax deferred 2010, December 31 at Therefore, date. sheet balance the at enacted substantively or enacted been have that rates after reverse to expected is difference temporary the where 27%, of rate a on based calculated been have liabilities and assets Property, pl 1 April 2011. The effect of the remeasurement has had no material impact on the profit for the year. No account will been taken of the the of taken been will account No year. the for profit the on impact material no had has remeasurement the of effect The 2011. April 1 a have not will this that estimated is it however changes, these of enactment substantive until rates tax in reduction 3% further group. the on impact material effective rate tax corporation UK main the in reduction 1% further a announced Government UK the end, year the to Subsequent the of end the by enacted substantially not was reduction the as change this of taken been has account No 2011. April 1 from period. reporting

Other short term timing differences Group def

Unrecognised deferred tax assets and liabilities Unrecognised deferred tax assets and of: in respect been recognised not tax assets have Deferred 12. Deferred tax assets and liabilities liabilities and assets tax Deferred 12. Group 2009 £m £m 2010 (5.6) (4.8) 40.5 42.0 62.3 62.3 Other Broadcasting (16.2) (15.5)

Other

Channel Developed Developed software software £m licence £m Total £m £m

17.8 0.8 18.6 — 18.6 — — (0.6) 4.6 0.8 — 18.8 — 0.6 4.6 22.4 — 4.6 0.6 0.8 23.2 12.7 — 1.4 23.2 — 4.6 — — 14.1 — — 24.0 0.8 14.1 — 1.3 — (0.6) 0.8 1.5 14.0 — — 0.7 0.6 2.1 15.7 2.2 — 2.1 16.2 — — — 0.6 5.1 16.2 0.8 4.5 — 2.9 — 4.5 — 3.1 2.3 — 19.2 0.7 — 3.3 — 2.5 2.5 8.4 1.7 7.0 7.0 4.8

Accumulated depreciation Impairment Net book value based on cost Cost Balance as 1 January at 2009 7) are (note on 30 April 2007 Ltd as part One Broadcasting of Life of the acquisition licences acquired The Broadcasting end the year this period. At amortised over and are line basis on a straight of six years life economic a useful have to considered identified. of these assets were of impairment no indications not support benefits did expected their for which the of certain projects the write-down in 2010 reflects charge The impairment 2). (also note the income statement within expenditure operating other to charged was carrying The impairment value. assets Intangible 11. Internally developed Balance December as at 31 2009 Balance as 1 January at 2010 Transfer Internally developed Balance December as at 31 2010 Amortisation Balance as 1 January at 2009 Amortisation for the year Impairment Balance December at 31 2009 Balance as 1 January at 2010 Transfer Amortisation for the year Impairment Balance December at 31 2010 Carrying amount At 1 January 2009 DecemberAt 31 2009 At 1 January 2010 DecemberAt 31 2010 the to in relation principally software, computer developed amounts capitalised on internally represents software Developed for criteria meeting the recognition scheduling applications and programme revenues management of advertising and sponsorship to two amortised over are line basis on a straight Assets under IAS 38 ‘Intangible Assets’. intangible assets generated internally recognised within is software developed for for use. The amortisation available charge becomes the asset the date from years five 2). and amortisation (note depreciation within the income statement Cost

10. Property, plant and equipment (continued) equipment and plant Property, 10. amounts: following at the been included in the financial statements have it would been revalued property not had If freehold statements continued statements financial to the Notes

FINANCIAL REPORT AND STATEMENTS 128 FINANCIAL REPORT AND STATEMENTS 131 4 4

Channel 2009 £m Channel 2009 £m 4 4

— — — — — 20.0 — 0.4 £m £m 3.7 2.7 9.2 8.8 0.6 0.7 2010 2010 95.7 126.9 50.1 — 56.5 55.0 24.6 7.7 109.0 10.4 152.2 201.9 Channel Channel

£m £m Group 2009 Group 2009 — 20.0 — 0.4 — — £m £m 0.6 0.7 3.8 3.7 6.4 6.4 — — 2010 2010 95.7 126.9 15.6 13.1 24.6 7.7 207.7 172.8 191.2 117.3 163.1 147.6 103.0 97.4 Group Group 109.0 10.4 152.2 201.9

109.0 10.0 109.0 10.0 56.5 55.0

* tradeTotal and other payables Corporation tax Current tax liabilities specify terms otherwise, payment and, unless agreed terms with contract in accordance all invoices pay to endeavours The group of the Director to time should be addressed on pay to complaints about failure Any of the invoice. of the date within 30 days appropriately. to and responded investigated are they that Finance, who will ensure the both 6 for was balances, payable using average as calculated of services suppliers in 2010, pay to taken The number of days payment to the due terms of 30 days payment standard than the group’s Channel 4 (2009: 6). This and is significantly lower group costs. and transmission programme for required arrangements financial to the Notes continued statements Amounts held in money market funds are repayable within seven days. within seven repayable funds are market Amounts held in money Moneymarket deposits maturing in less than three months Cash and cash equivalents Money market deposits maturing after three months Derivative financial instruments Other financial assets Accruals VAT Bank balances Moneymarket funds liabilities tax current and payables other and Trade 16. payables Trade National insurance Amounts due subsidiaries to Other creditors financial assets assets financial 15. Cash and cash equivalents and other other and equivalents cash and Cash 15. * 4 4

£m

Dec

Channel Channel 2009 £m 2009 £m 4 4

— — — 9.7 — — £m £m 0.8 3.2 2010 2010 £m 67.6 79.6 45.1 60.1 74.3 42.6 20.5 26.1 joint Balance 116.0 114.9

Channel Channel £m ised other Recognised

Group Group 2009 £m 2009 £m — 0.2 — — £m £m 1.4 1.1 2.4 5.0 2010 2010 57.7 75.2 77.0 44.2 69.9 81.4 Recogn in 22.8 33.1 Group Group 131.6 106.5 95.5 79.1 156.8 144.6 206.0 201.9 187.0 182.3 £m income income ventures at

Recognised comprehensive in

09 in

£m 5.9 — 6.6 — 12.5 3.0 (0.5) — — 2.5 4.2 1.2 6.6 — 12.0 6.8 1.0 6.6 — 14.4 (0.1) 0.7 — — 0.6 (2.6) 0.2 — — (2.4) (2.0) 0.8 — — (1.2) Jan

1 Balance

at nd equipment

Programmes and films in the course of production Acquired programme and film rights tradeTotal and other receivables Corporation tax Distribution and producer advances Programme rights and other inventories to the value of £559.3 million were recognised as expenses in the year (2009: £532.7 million). million). £532.7 (2009: year the in expenses as recognised were million £559.3 of value the to inventories other and rights Programme and million) £28.0 (2009: group the for million £33.5 totalled off written developments and programmes obsolete amount, this Of Channel 4 programmes. to related DVDs amounts held within the 4Rights segment for represent Other inventories Certain programme and film rights may not be utilised within one year. be utilised within one not film rights may and Certain programme million). £26.7 (2009: 4 Channel for million £30.3 Prepayments and accrued income receivables Trade Amounts due from subsidiaries 14. Trade and other receivables other and Trade 14. Programmes and films completed but not transmitted

inventories other and rights film and Programme 13. Other inventories Property, plant a

statements continued statements financial to the Notes

Distribution and producer advances are shown net of impairment charges amounting to £4.3 million (2009: £1.2 million) recognised £4.3 million (2009: £1.2 million) recognised amounting to charges net of impairment shown are advances Distribution and producer be to unlikely deals, which management consider are development on DVD paid advances to in relation year in the current sales. future through recouped Trade receivables are shown net of impairment charges amounting to £0.8 million (2009: £0.1 million) recognised in the current in the current million) recognised million (2009: £0.1 £0.8 to amounting charges net of impairment shown are receivables Trade as unlikely. of which management view the receipt customers, from outstanding balances to in relation year Amounts due to Channel 4 from subsidiaries are unsecured and bear interest at the Bank of England base rate prevailing at the at prevailing rate the Bank of England base at and bear interest unsecured subsidiaries are Channel 4 from Amounts due to beginning of the year.

Intangible assets – internally developed software Employee benefits Other short term timing differences Channel 4 deferred tax assets Other short term timing differences Group deferred tax assets 12. Deferred tax assets and liabilities (continued) liabilities and assets tax Deferred 12.

FINANCIAL REPORT AND STATEMENTS 130 FINANCIAL REPORT AND STATEMENTS 133 financial to the Notes continued statements 18. Derivatives and other financial instruments instruments financial other and Derivatives 18. and the nature about disclosures provide to Channel 4 is required with IFRS 7 ‘Financial Instruments: Disclosures’, In accordance financial instruments. arising from of risks extent risk Market the group’s will affect rates, and interest rates exchange prices, such as foreign risk is the risk changes in market that Market below. function as described treasury the group’s managed by are risks of its assets and liabilities. These income or the value are and funding activities treasury The group’s the group. for policy the treasury approving for is responsible The Board group’s manage the to of Finance. Its primary are activities the Director function which reports a treasury to undertaken by exchange currency foreign and in interest movements arising from and financial risk, principally funding requirements liquidity, continuing to support available the group’s is resource liquidity and financial adequate that ensure policy is to The group’s rates. The transactions. financial in speculative engage to policy is not The group’s whilst managing these risks. and growth activities and is and controls defined objectives within clearly operates treasury Group apply hedge accounting. seek to does not group 144). function (page the business assurance by periodic review subject to risk currency Foreign The than Sterling. other in currencies denominated are that risk purchases on sales and currency to is exposed The group cash and currency contracts exchange uses forward The group and Euros. US Dollars this rise risk to are give that currencies monetary economically hedge that contracts assets and of exchange risk. Changes in the fair value hedge its currency to receipts the Both in the income statement. recognised is applied are which no hedge accounting and for currencies liabilities in foreign monetary to are items and losses relating gains exchange and the foreign contracts forward of the change in the fair value result is not subsidiaries and as a foreign any have does not 5). The group as partrecognised net financial income (note of cash holdings. Amounts on foreign movements currency to is exposed The group risk in this regard. currency foreign to exposed cash and deposits. and Channel 4’s of the group’s within the analysis detailed below are currency held by with all other currencies other against sheet date the balance 10% at by strengthened/weakened had if Sterling that It is estimated million). (2009: £0.1 million lower/higher been £0.1 would have tax before profit held constant, the group’s variables and exposure risk rate Interest market money rate variable accounts and bank deposits, high interest market money rate surplus cash in fixed invests The group from or equivalent rating carry that a minimum of an A+ credit list of organisations only with an agreed invested are funds. Funds an AAA have that funds support, market services or with money rating with government credit and Moody’s and Poor’s Standard services. rating either of these credit from rating credit held constant the variables with all other the year, throughout lower/higher been 0.1% had rates if interest that It is estimated million). (2009: £0.2 million lower/higher been £0.2 would have tax before profit group’s regard. in this rates in interest fluctuations to exposed debt and as such is not any have does not The group 4

Group 2009 Channel £m 4

£m 7.0 25.0 3.1 7.3 3.9 17.7 2010 Channel Other Restructuring 4

Channel 2009 Group £m £m 7.0 25.0 3.1 7.3 3.9 17.7 2010 Group

£m £m £m £m £m 1.6 — 1.6 — 1.6 9.3 9.3 18.6 0.5 19.1 6.9 0.1 7.0 — 7.0 2.0 — 2.0 — 2.0 2.8 — 2.8 — 2.8 (5.1) (6.6) (11.7) (0.5) (12.2) (6.1) (0.7) (6.8) — (6.8) (9.8) (2.4) (12.2) — (12.2) (3.8) — (3.8) — (3.8) 21.8 3.2 25.0 — 25.0 16.0 0.5 16.5 — 16.5 21.8 3.2 25.0 — 25.0 Onerous Restructuring Contracts costs Total Costs Total

Contingent liabilities Contingent member of the group any against pending or threatened, proceedings, or arbitration legal of any aware not are The members a significant contingent liability. rise to which gives Where the effect is material, provisions have been discounted at a nominal rate of 10%, which reflects a risk-free rate of 3.5%, an of 3.5%, rate a risk-free of 10%, which reflects a nominal rate at been discounted have provisions is material, effect the Where of 11%). and a beta of 1 (2009: nominal rate of 6.5% equity risk premium Restructuring costs Restructuring the 2010 During services. transmission and broadcast of outsourcing the related 2009 December 31 at provision restructuring The Utilisations utilised. provision the of majority the and completed was City White at premises Limited Bee Red to services of migration statement. income the within expenditure operating other within included been have year the during releases and A £9.9 million credit in respect of deficits on two properties and certain content agreements, and reflected as provision releases provision as reflected properties and and certain on two of deficits agreements, content in respect million credit A £9.9 arises as a result This credit during the year. recognised of discounts of £3.8 million, was of unwinding million and reversal of £6.1 property of one long term the successful renegotiation agreement, including the conclusion of one content factors of several a second property. at end occupancy of year lease, and a change in estimate Onerous contracts with and certain agreements requirements content to surplus buildings which are deficits on three rental to relates The provision are the provision to and additions of the provision Utilisations and releases sheet date. the balance commitments at contracted 2). The (note within the income statement expenditure operating costs and other content and other in programme recorded in 2011. expire agreements and the content in 2014 and 2020 expire set to are agreements property rental

Non-current Current

Utilised in the year Charged income to statement Unwinding of discount DecemberAt 31 2009 At 1 January 2010 Utilised in the year Released in the year Charged income to statement Unwinding of discount Reversal unwinding of of discount DecemberAt 31 2010 Provisions have been analysed as current and non-current as follows: At 1 January 2009 17. Provisions 17. statements continued statements financial to the Notes

FINANCIAL REPORT AND STATEMENTS 132 FINANCIAL REPORT AND STATEMENTS 135 financial to the Notes continued statements 18. Derivatives and other financial instruments instruments financial other and Derivatives 18. (continued) risk Liquidity liquidity due. The management of operational fall as they meet its financial obligations fails to Liquidity risk is risk the the group that is of has a liquidity buffer that able, in the short absorb the net effects to term, always group the that ensure riskto aims primarily conditions without incurring unacceptable and stressed under normal changes in liquidity both and expected made transactions support to be adequate to considered are the group held by cash balances The reputation. the group’s losses or risking to damage funding requirements. medium-term the group’s million for £207.7 2010 was December 31 at payables and other of trade 16. The value in note shown are payables and other Trade of these financial liabilities million). The fair value Channel 4 (2009: £117.3 and £191.2 million for million) (2009: £172.8 the group within payable classified as to the carrying equal amount and are are cash flows contractual The equals their book values. and 2009. December 2010 31 6 months or less at Credit risk to meet its or counterpartyto a financial instrument fails if a customer risk isto the group the risk of a financial loss Credit customers. from receivables the group’s from and arisesprincipally obligations, contractual receivables (i) Trade advertising agencies. A risk strategy exists amounts due from to related is principally receivables trade to risk with respect Credit most for including insurance of reference terms approved to working advertising sales receivables to exposure against protect to an executive to reported formally issues are and any basis, on a weekly and reviewed is monitored Exposure customers. and insurers, the committee and discussions with both evaluation of Finance. Based on credit the Director by chaired committee with the group. trade to security in order provide to be required may customers and other of trade losses in respect of likely our estimate represents that impairment for establishes an allowance The group exposures. to individually significant relates is that a specific loss component The main component of this allowance receivables. advertising transmissions as agencies must settle their debts before low historically are these receivables to with regard Losses broadcast. are (ii) Counterparty 133. on page risk exposure rate See Interest Exposure to credit risk balance at the exposure The maximum credit exposure. the maximum credit represents The carrying amount of financial assets (2009: £106.5 million) the group million for £131.6 was impairment, for net of allowance receivables, trade to in relation sheet date and Channel 4 the group for both financial assets of other million million), with £109.0 Channel 4 (2009: £79.1 for million and £95.5 million). (2009: £201.9 million and Channel 4 of £152.2 the group both for and cash and cash equivalents million) (2009: £10.4 the UK was for region geographical by sheet date balance the at receivables trade risk for credit to The maximum exposure to The maximum exposure million). Channel 4 (2009: £77.6 million) and £94.8 million for (2009: £105.0 the group million for £130.7 Channel 4 million for million (2009: £1.5 million) and £0.7 £0.9 was the group for regions other for receivables trade risk for credit (2009: £1.5 million). million) 4 (2009: £79.0 Channel million for (2009: £106.4 million) and £95.4 the group million for of £131.5 receivables Trade six and Channel 4 aged between the group both million for of less than £0.1 aged under six months, with the remainder were the group million for of £121.7 receivables due under six months are million). Included in receivables (2009: £0.1 months and twelve sheet date the balance at terms credit due under standard yet not Channel 4 which were million for million) and £90.6 (2009: £97.7 at insured of Channel 4 were and £88.8 million of the receivables of the group million of the receivables million). £93.1 (2009: £76.7 and Channel 4 since the the group by collected been subsequently million have million and £92.6 and £123.4 sheet date the balance sheet date. balance million). (2009: £0.1 sheet date the balance million at £0.8 was receivables of trade impairment for The allowance Capital structure and management the group relevant, not therefore are shareholders to Whilst returns Channel 4 is shareholders. without a statutory corporation in a timely and objectives and meet its business revenue short against in fluctu

4 4 4 4

Channel Channel Channel Channel

and and and and

Group Group Group Group Effective Effective Effective Effective rate Total rate Total rate Total rate Total interest interest interest interest % £m % £m % £m % £m

1.1 109.0 2.0 10.0

0.6 201.9 0.0 0.7 15.5 152.2

Dollars 0.1 0.1

Sterling US Euros 0.6 200.8 0.4 1.0

in in in

held held held

months months months

three three three

than than than

less less less

in in in

maturing maturing maturing

deposits deposits deposits

bearing bearing bearing

Other financial assets Money market deposits maturing after three months held in Sterling

Other financial assets Money market deposits maturing after three months held in Sterling Interest Interest

Cash and cash equivalents Interest

Cash and cash equivalents Interest bearing deposits maturing in less than three months held in Sterling Interest bearing deposits maturing in less than three months held in US Dollars Interest bearing deposits maturing in less than three months held in Euros Non-interest bearing assets held in Sterling 0.1 0.7 136.5 0.1 0.8 0.1

Interest rate risk rate Interest (continued) 31 December 2009 is 2010 and 31 December at cash and deposits and Channel 4’s of the group’s profile rate The interest set out below: 18. Derivatives and other financial instruments instruments financial other and Derivatives 18. statements continued statements financial to the Notes 2010 2009 2010 2009

FINANCIAL REPORT AND STATEMENTS 134 FINANCIAL REPORT AND STATEMENTS 137 4

0.1 Channel 2009 2009 £m £m 2009 £m 4

£m £m £m 1.6 1.9 0.3 — 0.8 2010 2010 2010 21.9 27.4 23.8 29.3 247.6 275.4 198.0 208.3 Channel

Group £m 2009 £m 2010 517.4 561.9 445.6 483.7 227.3 239.7 Group 290.1 322.2

b) Digital 3 and 4 Ltd commitments b) Digital 3 and 4 Ltd d) Capital commitments e) Other commitments c) Operating lease commitments c) Operating of £0.8 rentals Annual expiring in 2014 and 2020. leases London under operating four properties in in leases office space The group provisions. contract the utilisation of onerous offset by in 2010 with the remainder the income statement to charged million were with by the group, four properties has been sublet all in million. Office space £23.5 commitment amounts to rental future The total 2011 and 2020. between million on sub-leases expiring £13.7 amounting to receivable payments the minimum future 2013 and 2015. expiring between leases under operating and Manchester in Glasgow leases office space the group In addition, under the leases amounts to commitment in 2010 and the total the income statement to charged million were of £0.1 Annual rentals million. £0.3 as set out below: commitments, contracted had the group December, 31 At of meeting its share to 8), Channel 4 is committed (note TV Ltd YouView for agreement of the shareholder Under the terms 2011 and 2014 has between payments committed of YouView’s share Channel 4’s company. that by into costs entered contracted information. sensitive disclose commercially be to this would believe been disclosed as the members not After five years financial to the Notes continued statements Under the terms of the shareholder agreement for Digital 3 and 4 Ltd, Channel 4 is committed to meeting its share of contracted of contracted meeting its share to Channel 4 is committed Digital 3 and 4 Ltd, for agreement of the shareholder Under the terms annual monetary commitment is dependent upon the timing of the exact Digital 3 and 4 Ltd’s company. that by into costs entered network. of the digital transmission roll-out £17 million in 2011 and £19 million in 2012. amount to to is estimated payments committed of Digital 3 and 4 Ltd’s share Channel 4’s to 4 is and Channel committed and 2034 in 2022 expire that distribution contracts long term into has entered Digital 3 and 4 Ltd share. funding its contractual the S4C service carriage of S4C for on Channel to charged is costs net of fees contracted of Digital 3 and 4 Ltd’s share Channel 4’s million in 2011. £0.6 amount to to estimated are These fees of the Digital 3 and 4 multiplex. share 4’s land and buildings, for leases, all of which were operating commitments under non-cancellable total had the group December, 31 At as set out below: Within two five to years Property, plant and equipment: Contracted but not provided in the financial statements 19. Commitments 19. and film commitments a) Programme follows: was as payment for and films due programmes for expenditure future committed December, 31 At Within one year Operating leases which expire: Within one year

After one year value

£m 2009 £m 2010 value Fair (0.1) — (0.1) —

2009 2009 Book £m £m value

£m £m 1.6 1.6 2.5 2.5 2010 2010 27.6 27.6 28.9 28.9 value Fair

207.7 207.7 172.8 172.8 109.0 109.0 10.4 10.4 447.2 447.2 388.3 388.3 156.8 156.8 144.6 144.6 Book

207.7 207.7 172.8 172.8

152.2 152.2 201.9 201.9

Channel

and

Equity investments (note 9) Except where otherwise stated, the disclosures in respect of derivatives and other financial instruments for Channel 4 are the for Channel 4 are financial instruments and other of derivatives in respect the disclosures otherwise stated, where Except the group. same as for Interest rates used for determining fair value determining used for rates Interest value of financial assets the fair to determine cash flows discount is future used to the reporting cost of capital at date The group’s and liabilities. Trade and other receivables/payables and other Trade the reflect amount is deemed to the notional of less than one year, life with a remaining receivables/payables and other trade For of rate at the market discounted cash flows of future value as the present estimated are receivables/payables All other fair value. the reporting at date. interest Forward exchange contracts exchange Forward price is not market If a quoted price, if available. market on their quoted is based contracts exchange of forward The fair value forward price and the current forward the contractual between discounting the difference by is estimated the fair value available, rate. interest using a risk-free of the contract maturity the residual price for The major methods and assumptions used in estimating the fair values of the group’s financial instruments are summarised below. financial instruments are of the group’s the fair values The major methods and assumptions used in estimating Financial liabilities andTrade other payables (note 16) is cost at a reasonable valuation that believe held, the members the equity investments for market is no publicly traded there As future. in the foreseeable dispose of its equity investments to intend does not The group of fair value. approximation

andTrade other receivables (note 14) Investments accounted for using equity method (note 8) Financial assets Cash and cash equivalents (note 15)

Derivative financial instrument

Other financial liabilities Other financial liabilities comprise: Group Other financial assets (note 15) Fair values Fair class: by instruments financial group’s the all of values fair corresponding and values book of comparison a out sets below table The (continued) financial instruments Derivative million £10.8 used as economic hedges of monetary contracts liabilities was of forward value the total December 2010, 31 At maturity a fixed million had of which all £10.8 contracts, purchase forward thirteen Euro This(2009: £14.8 million). represents with been revalued these have end, the 2010 year At sheet date. the balance months from settlement within twelve with date the income in million has been recognised of £0.5 in fair value The change on maturity. based rates exchange forward to reference million is included below: liability of £0.1 5) and the associated (note statement 18. Derivatives and other financial instruments instruments financial other and Derivatives 18. statements continued statements financial to the Notes

FINANCIAL REPORT AND STATEMENTS 136 FINANCIAL REPORT AND STATEMENTS 139 % % % % £m £m £m £m £m £m £m £m £m £m £m £m 2009 years 2008 years 2007 years 2006 years 2009 2008 2007 2006 2009 2008 2007 2006 2009 2008 2007 2006 2009 2008 2007 2006 % £m £m £m 0.7 0.7 0.9 2.1 2.0 5.1 3.5 5.7 6.1 6.1 3.1 2.8 3.9 4.0 4.1 1.0 1.3 (1.4) (1.4) (1.1) 4.6 (23.7) (13.7) 4.0 11.7 4.8 4.8 3.4 4.7 5.0 4.8 4.8 3.4 4.7 5.0 2010 2010 2010 2010 2010 (1.3) — (0.9) — — 29.2 29.2 29.1 29.4 29.4 12.9 13.9 (33.0) (1.4) 0.6 (8.3) (37.6) 19.3 5.4 11.1 5.42 5.75 6.00 5.60 5.25 3.50 3.50 3.60 3.60 2.75 2.75 3.20 3.20 3.05 3.05 28.1 28.1 28.0 29.4 27.5 years 12.8 10.4 10.1 9.1 8.3 28.4 28.3 28.3 26.6 26.6 8.20 2.00 8.40 1.00 7.00 3.00 7.50 5.50 7.60 5.25 4.00 4.50 3.65 3.45 3.30 26.8 26.7 26.6 26.6 24.5 4.80 5.00 5.00 5.70 5.10 (11.8) (9.1) (11.5) (10.5) (9.4) ts – pensions (continued) pensions – ts fi Net charge to income statement Net charge to income statement Principal actuarial assumptions at the balance sheet date sheet the balance actuarial assumptions at Principal Life expectancy from 60 aged (now 60) – female Net financial income Expected return on plan assets Expected return onplan assets – cash Experience gain/(loss) on plan assets The expense has been recognised in the following lines in the income statement: lines following in the has been recognised The expense financial to the Notes continued statements Discount rate Rate of increase in salaries Rate of increase in pensions Inflation Expected return on plan assets – equities Expected return on plan assets – bonds Life expectancy from 60 aged (now 40) – male Life expectancy from 60 aged (now 40) – female Life expectancy from 60 aged (now 60) – male Plan. If Pension Staff Television actuary with the independent in consultation the Channel Four to adopted These assumptions were corresponding will be a there be amended in future, these assumptions, or if the assumptions need to from is different experience set by on plan assets are returns sheet. The expected balance on the group on the net pension scheme liability recorded impact of the Plan. asset allocation long term and the expected indicators market current returns, historical to reference 20. Employee bene Employee 20. statement: in the income Expense recognised Current service cost Cost of transmission and sales Other operating expenditure Experience (loss)/gain on plan liabilities Gain on settlements Interest on pension scheme liabilities The cumulative amount of net actuarial losses recognised in the statement of comprehensive income since transition to IFRS is to income since transition of comprehensive in the statement losses recognised amount of net actuarial The cumulative million. £36.0 Actuarial gain/(loss) Fair Fair Fair Fair

£m £m £m £m 2009 2008 value 2007 value 2006 value value £m 6.6 3.2 3.4 3.5 4.1 Fair 2010 93.7 74.1 69.3 58.0 43.5 101.9 98.4 76.6 105.3 105.6 202.2 175.7 149.3 166.8 153.2 value £m £m £m £m £m £m £m £m £m £m £m £m 2009 2008 2007 2006 2009 2008 2007 2006 2009 2008 2007 2006 £m £m £m 9.7 4.7 5.4 6.2 10.5 5.1 3.5 5.7 6.1 6.1 1.2 1.4 1.6 1.3 1.3 1.2 1.4 1.6 1.3 1.3 8.3 37.6 (19.3) (5.4) (11.1) 2010 2010 2010 (9.1) (2.7) (3.0) (3.0) (1.9) (9.1) (2.7) (3.0) (3.0) (1.9) (1.3) — (0.9) — — 11.8 9.1 11.5 10.5 9.4 12.9 13.9 (33.0) (1.4) 0.6 12.8 10.4 10.1 9.1 8.3 175.7 149.3 166.8 153.2 133.3 237.6 220.6 170.4 176.2 168.1 (35.4) (44.9) (21.1) (9.4) (14.9) 220.6 170.4 176.2 168.1 165.4 202.2 175.7 149.3 166.8 153.2 202.2 175.7 149.3 166.8 153.2 (237.6) (220.6) (170.4) (176.2) (168.1) % % % % 2009 Actual 2008 Actual return Actual 2007 return Actual return 2006 return % — — — 5.3 3.0 9.0 2.5 11.2 5.1 0.3 2010 19.5 28.5 (26.3) 7.6 10.7 return Actual ts – pensions – ts fi * £m £m £m £m Actual Actual Actual Actual 2009 2008 2007 2006 return return return return — — — — — £m 7.8 2.6 7.0 1.4 0.1 2010 16.9 20.4 (28.4) 7.7 9.9 24.7 23.0 (21.4) 9.1 10.0 return Actual

Present value scheme of liabilities December at 31 Recognised liability for defined benefit obligations Fair value scheme of assets December at 31 Fair value plan of assets Other balance sheet: recognised in the defined benefit obligations of scheme liabilities for value present in the Movements

Present value of scheme liabilities 1 January at sheet: the balance in of plan assets recognised in the fair value Movements Bonds Current service cost Gain on settlements Employee contributions net charges of Interest costs Benefits paid Equities

Fair value scheme of assets 1 January at

Expected return on plan assets Benefits paid Employer contributions net charges of Present value of funded obligations The amounts recognised in the group and Channel 4 balance sheets are as follows: as are sheets Channel 4 balance and group in the The amounts recognised 20. Employee bene Employee 20. providing Plan (the Plan), Pension Staff Television Channel Four a defined benefit pension scheme – the operates The group on final salary employees. benefits based for statements continued statements financial to the Notes Employee contributions net charges of

The fair value of the plan assets and the return on those assets were as follows: on those assets were and the return of the plan assets The fair value 2006. in March paid million in December 2010 and £5.7 million paid contribution of £2.9 contributions include an additional Employer Actuarial loss/(gain) on plan liabilities Actuarial gain/(loss) on plan assets

FINANCIAL REPORT AND STATEMENTS 138 FINANCIAL REPORT AND STATEMENTS 141 prepare the financial statements on the going concern on the statements the financial prepare the group that presume to unless it is inappropriate basis will continue in business. and the Corporation and non-content) annual budget (content Channel 4’s Executive of the Chief the appointment and re-appointment of the re-appointment of the appointment and confirmation Executive the Chief by nominated members executive other jointly and the Chairman acting facilities and loan arrangements banking of outside the ordinary course significant proposal any business Channel 4’s of the Corporation the appointment and re-appointment Secretary of the statutory the appointment and re-appointment auditors the audit by of Channel 4 presented accounts the audited committee — proper keeping for responsibility accepted have The members explain the and to show sufficient are that records accounting and disclose with reasonable transactions Corporation’s the financial position of the Corporation. time any at accuracy as are taking such steps for responsibility general have They the group the assets of safeguard them to open to reasonably irregularities. and other fraud and detect prevent and to Members’ a voluntarily prepare to decided have members The The to 8 Schedule with accordance in Report Remuneration and (Accounts Groups and Companies Medium-sized and Large Act Companies the under made 2008, Regulations Reports) Corporation. the to apply to were requirements those if as 2006, ensuring compliance with the for responsible are The members 2003, Act 9 of the Communications of Schedule requirements 146. as set out on page and the maintenance for responsible are The members included on and financial information of the corporate integrity the Legislation in the UK governing website. the Corporation’s may and dissemination of financial statements preparation jurisdictions. legislation in other differ from Board The its through is controlled Corporation Television Channel Four discharge is to main role The Board’s of members. Board the fulfilment of the statutory functions and ensure Channel 4’s Act the Digital Economy (as amended by public service remit and regulations. with all applicable laws 2010) in accordance has a least nine times a year, which meets at The Board, The following its approval. for reserved schedule of matters the full Board: to must be referred matters — — — — — — — —

select suitable accounting policies and then apply them select suitable accounting consistently; and reasonable are that judgements and estimates make prudent; with in accordance been prepared have whether they state the EU; and by as adopted IFRSs Corporate governance corporate of standards high to committed is Board The voluntarily prepare to decided have members The governance. compliance demonstrate to Statement Governance Corporate a Combined UK the of relevant, where principles, main the with and disclosure the and Governance Corporate on Code Financial the of Rules Listing the of provisions transparency Authority. Services compliant was it year, the throughout that, considers Board The by issued Code Combined the of provisions relevant the with will Board The 2008. in (FRC) Council Reporting Financial the UK the with compliance its on Report Annual 2011 the in report 2010. June in FRC the by issued Code Governance Corporate without as a statutory status corporation Channel 4’s concerning those provisions means shareholders applicable. Also, directly not are interests shareholders’ formal are there committee, of a nominations instead 143. described on page which are procedures nominations members’ of Statement respect in responsibilities and Report Annual the of Statements Financial the Four Channel of Corporation Television ‘Corporation’) (the the Annual Report preparing for responsible are The members in financial statements and Corporation’s and the group and regulations. with applicable law accordance legislation (the its governing by is required The Corporation and proper accounts proper keep 1990) to Act Broadcasting financial prepare and to the accounts, to in relation records the law Under that year. financial of each in respect statements of the financial statements prepare to elected have members as with IFRSs in accordance and the Corporation the group 4 of Part of Chapter the EU and the requirements by adopted a were 2006 as if the Corporation Act 15 of the Companies Act. under that incorporated company the financial approving for responsibility accept The members a true give satisfied they that only afterstatements are they and of the group of affairs of the state and fair view period. In for that or loss and of their profit Corporation financial and Corporation of the group each preparing the members: statements, — — — ts – pensions (continued) pensions – ts fi

in the remuneration report on pages 150-153. 150-153. report on pages in the remuneration Unit Ltd (2009: £0.1 million), £13.5 million to Digital 3 and 4 Ltd for digital terrestrial transmission services (2009: £9.1 million), services transmission (2009: £9.1 terrestrial digital for Digital 3 and 4 Ltd million), £13.5 million to £0.1 (2009: Unit Ltd Mobile IQ Ltd at 31 December 2010 (2009: £nil). 31 at Mobile IQ Ltd During 2010, Channel 4 received £0.3 million brand fee income from Espresso Education Ltd (2009: £0.2 million). No amounts (2009: £0.2 Ltd Education Espresso income from fee million brand £0.3 4 received Channel During 2010, During 2011, Channel 4 received a dividend of £3.6 million from Box Television Ltd (2009: £1.5 million), a dividend of £0.2 million (2009: £1.5 million), a dividend of £0.2 Ltd Television Box million from a dividend of £3.6 During 2011, Channel 4 received Details of transactions in which members have an interest are disclosed on page 97. Details of members’ remuneration are shown shown are remuneration Details of members’ 97. disclosed on page are an interest have in which members Details of transactions from Taste of London Ltd (2009: £0.3 million) and brand royalty income of £0.5 million from Box Television Ltd (2009: £0.3 million). (2009: £0.3 Ltd Television Box million from income of £0.5 royalty million) and brand (2009: £0.3 Ltd of London Taste from Subsidiary undertakings these companies. No amounts were due from or owed to these companies at 31 December 2010. December 2010. 31 at these companies to or owed due from No amounts were these companies. to these companies at 31 December 2010. 31 at these companies to these services, Box Television Ltd owed £0.2 million to Channel 4 at 31 December 2010 (2009: £2.2 million). December 2010 (2009: £2.2 31 Channel 4 at million to £0.2 owed Ltd Television these services, Box undertakings Channel 4). to Channel 4 paid £0.1 million to Mobile IQ Ltd to support the Channel 4 mobile portal (2009: £0.1 million). No amounts were due to due to million). No amounts were support to the Channel 4 mobile portal Mobile IQ Ltd million to (2009: £0.1 £0.1 Channel 4 paid Channel 4 paid £4.3 million in respect of service fees to YouView TV Ltd (2009: £nil). No amounts were owed to YouView TV Ltd at at TV Ltd YouView to owed (2009: £nil). No amounts were TV Ltd YouView of service to fees £4.3 million in respect Channel 4 paid Channel 4 recognised equal revenue and expense of £5.3 million with DTV Services Ltd (2009: £1.6 million) and £0.6 million with million) and £0.6 (2009: £1.6 Services Ltd million with DTV of £5.3 and expense equal revenue Channel 4 recognised Channel 4 paid £0.7 million of funding to Clearcast Ltd (2009: £0.7 million), £0.1 million of funding to Parliamentary Broadcasting Broadcasting Parliamentary million of funding to million), £0.1 (2009: £0.7 Ltd Clearcast million of funding to £0.7 Channel 4 paid Channel 4 paid £0.1 million to Protagonist Pictures Ltd for agency sales and film acquisition services. No amounts were due at due were acquisition services. sales and film agency for No amounts Ltd Pictures Protagonist million to £0.1 Channel 4 paid Channel 4 also supplied £1.7 million of marketing, finance and other support to Box Television Ltd (2009: £2.0 million). In respect of million). In £2.0 Ltd (2009: Television supportother Box finance and to million of marketing, Channel 4 also supplied £1.7 Channel 4 purchased creative design and production and interactive services from 4 Ventures Ltd totalling £8.0 million (2009: £8.0 totalling Ltd 4 Ventures services from and interactive design and production creative Channel 4 purchased were due to Channel 4 at 31 December 2010 (2009: £nil). 31 Channel 4 at due to were Equity investments Equity £1.7 million to BARB for research services (2009: £1.4 million), £1.1 million to Thinkbox TV Ltd for marketing services (2009: marketing for TV Ltd Thinkbox million to services (2009: £1.4 million), £1.1 research for BARB million to £1.7 or owed due from million). No amounts were services (2009: £1.7 marketing for Services Ltd DTV million to million) and £1.9 £0.9 £9.3 million). At 31 December 2010 Channel 4 owed subsidiary undertakings £50.1 million (2009: £9.7 million owed by subsidiary by million owed (2009: £9.7 million subsidiary undertakings December 2010 Channel 4 owed £50.1 31 million). At £9.3 31 December 2010. 31

31 December 2010. 31 21. Related party transactions transactions party Related 21. The estimated employer contributions in 2011 are £7.4 million. £7.4 contributions in 2011 are employer The estimated Following the valuation and discussions with the Actuary to the Plan, the Trustees and the Board agreed to pay an additional an additional pay to agreed and the Board the Plan, the Trustees and discussions with the Actuary to the valuation Following to 1 January 2007 from per month payable £56,000 the current to 2010 in addition 1 April from of £238,000 monthly contribution pay a one off contribution of to agreed Board the above noted funding to the deficit addition In funding deficit. the Plan’s reduce in December 2010. million £2.9 20. Employee bene Employee 20. Actuaryactuarybasis independent a qualified of to the Plan) on the (the by determined the scheme are to Contribution rates The 1 January carried out as at 2010. was triennial valuation The most recent unit method. using the projected triennial valuation reflecting a deficit of to members, accrued had that of the benefits 85% assets represented the scheme’s that showed results million. £29.7 statements continued statements financial to the Notes Thinkbox TV Ltd (2009: £0.5 million) reflecting the group’s contribution of promotional airtime in respect of marketing services with airtime of marketing respect in contribution of promotional the group’s million) reflecting (2009: £0.5 TV Ltd Thinkbox Joint Ventures Joint Ventures

FINANCIAL REPORT AND STATEMENTS 140 FINANCIAL REPORT AND STATEMENTS 143 attended

2 (2) 1 (2) 1 (2) meetings

Audit Remuneration Number

(10) 10 3 (3) 9 (10) 2 (2) 8 (10) (10) 10 7 (10)

Appointed/ resigned Board committee committee members are advised that they have access to advice and the advice to access have they that advised are members their period Throughout services Secretary. Corporation of the on the group’s updated continually are in office the members changes affecting the and other business and environment written in as a whole, by and the industry it operates group executives. with senior briefings and meetings exercise. evaluation a Board The Chairman also conducted Corporation The Secretary include ensuring responsibilities Secretary’s The Corporation and its Board within the of information flow an effective and non- senior management and between committees and assisting with professional members, executive is Secretary The Corporation as required. development the Chairman through the Board advising for responsible matters. on all governance and advice provide to is Secretary available The Corporation compliance with Board ensure to services all members, to procedures. during 2010. Secretary Corporation was Nick Swimer meetings Board meetings meetings and committee The number of full Board in the is shown year member during the each by attended table below: Resigned July 2010 19 5 (6) Appointed 4 May 2010 6 (6) 2 (2) Resigned 30 April 2010 4 (4) Resigned 30 March 2011 (10) 10 Appointed 1 October 2010 Appointed 1 October 2010 Appointed 1 October 2010 Appointed 1 October 2010 (2) 2 (2) 2 (2) 2 (2) 1 Appointed 28 January 2010 (10) 10 2 (3) 2 (2) Resigned 30 September 2010 (8) 8 3 (3) Resigned 30 September 2010 (8) 5 2 (3) 2 (2) non-executive members are appointed for fixed terms by terms fixed for appointed are members non-executive Chairman 4’s with Channel consultation following Ofcom Culture, for of State of the Secretary and the approval Media and Sport the Board by is appointed Executive the Chief after the Board to appointed are members executive other and the Chairman acting Executive the Chief by nomination jointly. Figures in brackets indicate the maximum number of meetings in the period in which the individual was a Board/committee member. Board/committee a was individual the which in period the in meetings of number maximum the indicate brackets in Figures Non-Executives Executives Lord Burns Lord Puttnam Lord Hall Stephen Hill David Abraham Jon Gisby Kevin Lygo Karren Brady Richard Rivers Martha Lane Fox governance Corporate continued and member Board nominations executive statutory its constitution and specific provisions Given Channel 4 does not of members, the appointment regarding formal The following committee. nominations a formal have in place: are procedures nomination — — — Professional development part in an induction take On appointment, the members about the group, information receive when they programme its decision, for reserved and the matters of the Board the role Board of the principal and membership of reference the terms to delegated and the powers and management committees, practices governance corporate group’s the committees, those the group’s to reserved including the powers and procedures, financial information latest and the most senior executives, meetings with by This is supplemented about the group. On appointment, all of the senior management team. members

Monica Burch Mark Price Anne Bulford Andy Barnes Andy Mollett Alicja Lesniak ve five the past within of the group has been an employee years a material years, three past within the has, or has had with the group business relationship fee than their member’s other remuneration receives party the related to is drawn (although attention 97) on page transactions advisers, of the group’s has close family ties with any or senior employees members with other or has significant links holds cross-directorships or companies in other involvement through members bodies the from than six years more for on the Board has served election. of their first date The role of the Chief Executive is to run the business of run the business is to Executive of the Chief The role to the Board, from authority Channel 4 under the delegated and the Board, by and strategyimplement the policies agreed stakeholders. key and other with Ofcom communicate to as acted Finance Director) (the then Group Anne Bulford 2010, 2009 until May November from Executive Chief Interim Executive. joined as Chief Abraham when David independent Senior member Deputy Chairman and senior independent Puttnam was Lord the year. member throughout members’ and Members independence with their together members, The names of the 2010 Board 148-149. set out on pages are biographies, brief and help challenge constructively members The non-executive independent and bring strong, on strategy, proposals develop the Board’s to and experience judgement, knowledge, of sufficient are members The non-executive deliberations. carry in significant weight their views and number that calibre to access given are decision making. The members the Board’s when expense the group’s at advice independent professional carry them to deem it is necessary for the members in order professional Details of the Chairman’s out their responsibilities. These do not included in his biography. commitments are with Channel 4. affect his role adversely be to members all its non-executive considers The Board this the time of and judgement. At independent in character member: report, no non-executive — — — — — —

leadership of the Board, ensuring its effectiveness on all ensuring its effectiveness of the Board, leadership including the setting of the agenda aspects of its role timely and accurate, receive all members ensuring that clear information and skills their update continually members all that ensuring to and familiarity with Channel 4 required the knowledge and on committees on the Board both fulfil their role contribution of non-executive the effective facilitating between relations and ensuring constructive members members and non-executive executive and committee undertaking of Board an annual evaluation performance. the establishment, purchase or acquisition of any qualifying of any or acquisition the establishment, purchase of of terms or variation the approval and company subsidiary any for reference business investment significant new of any approval headcount 4’s to Channel changes significant proposed time time to from may as the Board matters such other upon. or decide review to resolve

— — — — — as Chairman in November appointed Burns was (Terry) Lord 28 January from 2009 and his appointment became effective 2010. The Chairman has the responsibility of leading the Board in the Board of leading The Chairman has the responsibility of Channel 4 and of and standards setting the values the of trust with and between maintaining a relationship The Chairman is members. and non-executive executive things: among other for, responsible Executive Executive the Chairman of the between The division of responsibilities is clearly defined as described Executive and the Chief Board below. Chairman and Chief Chief and Chairman The roles of the the of roles The The Board has an established audit committee and has an established audit committee The Board of its assist with the discharge to committee remuneration functions. continued — — — — the ensure to responsibility as partIn addition, of its overall statutory and functions, the duties 4’s fulfilment of Channel the successful delivery on ensuring of focus continues to Board public service and other responsibilities. remit Channel 4’s of the content investment future output and plans for Content Board discussed as part regularly of the overall budget are to on audience reactions updates regular agenda, as are Channel 4’s also approves The Board content. Channel 4’s (incorporating Policy of Media Content Statement proposed prior to and Review) Policy of Programme the Statement publication. governance Corporate

FINANCIAL REPORT AND STATEMENTS 142 FINANCIAL REPORT AND STATEMENTS 145 to monitor the integrity of the financial statements of of the financial statements the integrity monitor to to relating announcements formal Channel 4 and any significant reviewing performance, financial Channel 4’s reportingfinancial judgements contained in them and financial controls internal Channel 4’s review to and risk management systems control internal Channel 4’s the to in relation Board the to recommendations make to of the external removal and appointment, reappointment of and terms the remuneration approve and to auditors auditors of the external engagement independence auditors’ the external and monitor review to of the audit process and objectivity and the effectiveness and UK professional relevant consideration taking into requirements regulatory of the engagement and implement policy on the develop to services supply non-audit to taking into auditors external the provision ethical guidance regarding relevant account to audit firm; and the external of non-audit services by of in respect identifying matters any the Board, report to is needed or improvement action that which it considers be taken to the steps as to and making recommendations about the audit committee’s the Board update regularly to recommendations appropriate and make activities may that of matters is aware the Board ensure to of on the financial condition or affairs significantly impact the business of Channel 4’s the effectiveness and review monitor to function and activities business assurance 9 audit. the Schedule regarding recommendations make to draftto prior statements financial the group’s reviewing the external and reviewing and approval review Board detailed reports thereon auditors’ accounting of the group’s the appropriateness reviewing policies in the group’s impact the potential regularly reviewing of certain such as asset financial statements matters impairments and reviewing the audit fee and approving reviewing auditors external the group’s to payable non-audit fees The committee’s key responsibilities are: are: responsibilities key The committee’s — — — — — — — — — special can instigate the audit committee If necessary, or special counsel engage and, if appropriate, investigations the executive meets with assist.experts committee The to audit and management and the Chairman of the members and Head auditors with the external meets privately committee of Business Assurance. by: its responsibilities discharged In 2010 the committee — — — — to approve the level of any annual salary increases, annual salary of any increases, the level approve to applicable and the where bonuses payable corporate and members executive for of remuneration structure senior management for increases significant merit or market approve to award the general individuals or posts above policy vehicle Channel 4’s approve to significant change in Channel 4’s other any review to package remuneration and related pension fund arrangements Channel 4’s the remuneration benefits. In particular, employee consequences and the pension considers committee salaryof basic Channel 4 costs to increases associated changes in pensionable remuneration, other and any retirement. close to members especially for Audit committee committee Audit comprised Andy Mollett During 2010 the audit committee times met three The audit committee Brady. (Chair) and Karren during the year. independent non- are of the committee All the members invitation, Chairman’s the committee At members. executive the Chief Executive, the Chief the Chairman of the Board, external of Finance, the KPMG LLP Director Officer, Operating of Business Assurance Head audit partner and the Channel’s meetings of the Committee. attended (amongst others) partner audit of Business Assurance and Head The external as committee the Chairman of the audit to access direct have least one member at had In 2010 the committee required. Andy Mollett, a experience. and relevant possessing recent Financial Officer of Chrysalis is Chief accountant, chartered it a wide range bring to of the Committee plc. Other members the highest level. positions at from of experience governance Corporate continued Remuneration committee comprised committee During 2010 the remuneration Hall. The and Lord Martha (Chair), Brady Lane Fox Karren the year. met twice during committee remuneration independent non- are of the committee All the members the Chief The Chairman of the Board, members. executive others Officer amongst Operating and the Chief Executive member attends No executive meetings as appropriate. attend times when any at committee meetings of the remuneration is of employment terms or aspect of his or her remuneration being discussed. are: responsibilities principal The committee’s — — — — — shown are remuneration details concerning members’ Further 150-153. on pages remuneration in the report on members’ Editorial and compliance Editorial and and compliance systems editorial strong are There Channel 4. commissioned by the content over in place controls contained with guidance and protocols These include specific with training together Handbook the Independent Producer Code and other Broadcasting the Ofcom which encompasses in close works The Commissioning team regulations. relevant department and Compliance with the Legal on all collaboration significant commissions. systems Management for prepared and business plans are Detailed annual budgets the Board. by approved the business, and are of area each produced, Detailed monthly management reports are with budget and income and expenditure actual comparing the throughout prepared are forecasts year Full prior year. and members, the by monitored These reports are year. all significant variances. for provided are explanations Control procedures authorities is authorised a delegated in line with All expenditure is used authorisation system invoice An electronic framework. and Authorisation further environment. to enhance the control signatory and bank strictly segregated, duties are payment Financial controls mandate. bank clearly defined by limits are the audit and by management review by monitored are committee. audit Internal function undertook the business assurance a During 2010, control that assurance provide to number of specific projects and effectively, and working appropriate were processes improvements. necessary recommend where and performance the output of reviews The audit committee the Board. and reports these to business assurance

is responsible for the company’s system of internal control control of internal system the company’s for is responsible control policies on internal sets appropriate reports that regular and receives assurance regular seeks is functioning satisfyenable it to the system itself that effectively in is effective control of internal the system that ensures of and reporting risks on the adequacy identifying key and manage those risks to respond to actions the preparation for process the group’s for is responsible accounts. of the consolidated

A summary of the key risks that the group faces, together with together faces, the group that risks A summary of the key in the Business is presented mitigated, are those risks how 96-97. pages on of the members review Risk management 9 of the under Schedule its requirements to In addition and the Board 146, set out on page 2003 Act Communications of the identification for a clear responsibility management have putting in place for and the Corporation facing risks and The Board such risks. and mitigate monitor to procedures for a risk management framework operate Executive than eliminating) and managing (rather identifying, evaluating has been Channel 4. This framework by faced significant risks guidance good practice with relevant in accordance developed and risk management. controls on internal The Corporation has a Code of Conduct and a suite of policies has a Code of Conduct and a suite The Corporation conduct ethical behaviour, which encompass and procedures controls. and internal — — — — — Control environment the established for are Clear management responsibilities terms set out in the group’s These are members. executive manual. of reference In accordance with good corporate governance practice the practice governance with good corporate In accordance Board: Internal control Internal Information Information the members to circulated are reports and papers Regular are papers meetings. These and committee Board before by the requested specifically information by supplemented a report circulates Executive time. Each time to from members of a review provide meeting in which they Board each before plans and performance, with comments on future together outlook. continued governance Corporate

FINANCIAL REPORT AND STATEMENTS 144 FINANCIAL REPORT AND STATEMENTS 147 confirming our understanding of the Corporation and the of the Corporation confirming our understanding comply to made in place and controls procedures internal 9 of the under Schedule made with the arrangements enquiry senior of through 2003 Act Communications and personnel; appropriate management and other procedures internal of the relevant the operation testing relating records the financial of and examining and controls the above. to The arrangements agreed between the Corporation and Ofcom and Ofcom the Corporation between agreed The arrangements http://www.channel4.com/about4/pdf/C4_ from available are in of the Corporation The responsibility arrangements.pdf. is to 2003 Act 9 of the Communications of Schedule terms the throughout with these arrangements in accordance act period. review has the Corporation check whether is to Our responsibility ended 31 during the year complied with these arrangements our independent conclusion you December 2010 and report to done so. have whether they as to opinion Basis of with International in accordance carried out our work We 3000 Assurance Engagements on Assurance Standard of: consisted Our work Engagements. — — procedures on the internal carried out based was Our work during comply with the arrangements to in place and controls for responsible not are We December 2010. ended 31 the year sufficient and are concluding whether the arrangements Any set out above. the objectives achieve to appropriate not reasonable, give can only control of internal system will be met. the objectives that assurance, absolute Opinion has complied with the In our opinion, the Corporation 9 of the Communications under Schedule arrangements ended the year for respects, in all material 2003, Act December 2010. 31 LLP Deloitte Accountants Chartered London 2011 30 March identified; and evaluated; managed. properly an appropriate financial and organisational separation separation financial and organisational an appropriate to relate that of the Corporation the activities between the carrying out of their primary functions and their and activities; other in financial and of transparency degree an appropriate between shared are resources reporting where other is some other there or where activities separate otherwise connection between financial or practical activities. separated So far as reasonably practicable, secure that all significant that secure practicable, So far as reasonably effect an adverse will have activities their other that risks licence period, of on the carrying out, during the relevant their primary functions are: a) b) c) The transparency objectives of securing: objectives The transparency a) b) governance Corporate continued reporting Independent report accountants’ Four Channel to Corporation Television Corporation’) (‘the of Office the and Communications (‘Ofcom’) compliance of the Corporation’s performed a review have We December 2010 with the ended 31 during the year and the Office the Corporation between agreed arrangements schedule 9 of under section 2 of (“Ofcom”) of Communications 2003. Act the Communications Television This Channel Four report solely to is made of with our letter in accordance and Ofcom Corporation the (a) allow to 2011 and in order 3 March dated engagement under the Licence and meet its obligations to Corporation such procure to 2003 Act 9 of the Communications Schedule of its the carrying Ofcom facilitate reports out by and (b) to has been undertaken we so that functions. Our work regulatory we those matters and Ofcom the Corporation to might state them in a reporting accountant’s to state to required are the fullest extent purpose. To no other report and for to or assume responsibility accept do not we law, by permitted (in accordance and Ofcom Corporation than the other anyone our for 2011), March 15 dated with Ofcom with our contract formed. have this the opinions we report, or for for work, Television Channel Four of responsibilities Respective and Reporting Accountants Corporation to with Ofcom arrangements has agreed The Corporation as set out in (“the Objectives”) objectives following the secure 2003: Act 9 of the Communications Schedule — — an appropriate financial and organisational separation separation financial and organisational an appropriate the to relate 4 that of Channel the activities between carrying of their primary out functions and their other and activities; in financial and of transparency degree an appropriate between shared are resources reporting where other financial is some other there or where activities separated otherwise separated connection between or practical activities. The Act requires Channel 4 to submit proposals to Ofcom Ofcom to proposals submit to 4 Channel requires Act The secure, to proposes it which under arrangements the detailing the to risks significant all that practicable, reasonably as far so managed. properly and evaluated identified, are function primary Arrangements. the as to referred are proposals These which must include proposals the Arrangements In addition, transparency securing the for appropriate Channel 4 considers namely: as set out in the Act, objectives — — which the submitted to sets out the matters The Act and These include the procedures relate. may Arrangements Channel 4 in the case of the by be followed to practices other of the exercise ventures, and management of new initiation the imposition of the assessment of risks, particular powers, of records. and the keeping charges to checks regular put in place Channel 4 to requires The Act Channel 4 confirm that the Arrangements. is complying with Channel 4 must contain by proposed The Arrangements checked be to with the Arrangements compliance for provision auditor) than Channel 4’s (other a person by regularly provision. with that in accordance appointed compliance review LLP to Deloitte Channel 4 has appointed 147. on page and their report iswith the Arrangements shown the from available are Copies of the Arrangements channel4.com. and at Secretary Corporation Third party verification verification party Third statement it to Licence requires Digital Replacement Ofcom The Channel’s and report on partyappoint an independent review to Rate of Premium the provision to in relation procedures appointed were Services. PricewaterhouseCoopers Telephony the Channel’s be the independent partyto review to and of all processes conducted were Reviews procedures. Series 7 and Big Celebrity Big Brother to in relation procedures 4 satisfied Channel that are Series 11. The members Brother of requirements fulfil the to suitable procedures has in place 3b of the Licence. paragraph of Requirements the of 9 Schedule Act Communications Act) (the 2003

reviewing the external auditors’ plan for the audit of the for plan auditors’ the external reviewing confirmations on the accounts, risks key accounts, group’s audit fee proposed independence and the of auditors’ the annual business assurance and approving reviewing reviews business assurance plan and findings of risk management of Channel 4’s the effectiveness reviewed framework controls and internal framework reporting the findings of the independent reviewing arrangements concerning compliance with the accountants 2003 Act 9 of the Communications under Schedule

Since the year end Terry Burns resigned as a trustee (effective (effective trustee as a Burns resigned end Terry Since the year as a appointed was 2011) and Alicja Lesniat 2 February date 2011). 3 February date (effective trustee During the year the trustees were Luke Johnson (trustees’ Johnson (trustees’ Luke were the trustees During the year January2010); an independent member, 27 Chairman, resigned Chairman 28 January trustees’ (appointed 2010) Botting Louise 28 January of trustee (appointed Burns 2010); two and Terry and Diane Herbert Anne Bulford executives, Channel 4’s member-nominated and two Resources); of Human (Director and Management) of Facilities (Head Julie Kortens trustees, and Compliance). of Legal (Deputy Head Neil Pepin Pension plan Pension Staff Television of the Channel Four six trustees are There and with the year, times each Plan who meet several Pension Assurance & General Legal managers, investment Plan’s Ltd, Investors Global Henderson Management) Ltd, (Pensions least at Management Ltd Fund and F&C Ltd Life JP Morgan once a year. The audit committee also monitors the group’s whistle-blowing whistle-blowing group’s the also monitors The audit committee in are arrangements appropriate ensuring that procedures, of possible matters raise be able to to employees for place in confidence, and with suitable subsequent impropriety employees allow to in place Mechanisms are action. follow-up wrongdoing. report perceived to continued — — — — other provide to auditors use its external Channel 4 will not to do so. A summary effective services and unless it is efficient of services KPMG LLP in respect earned by of the fees the financial statements. 3 to in note in 2010 is shown provided the audit committee to an annual statement KPMG also makes regulatory of confirm its independence within the meaning to requirements. and professional governance Corporate

FINANCIAL REPORT AND STATEMENTS 146 FINANCIAL REPORT AND STATEMENTS 149 Director of Television since November 2003. Prior to joining Prior to 2003. since November of Television Director on 30 April 2010. Board of President Vice was Jon 4, Channel joining Before Media. UK. Yahoo of Director Managing and Europe Yahoo at Media at portals of Director Managing a was he this to Prior Corporate BBC’s the within Advisor Senior a and Freeserve 2010. July 19 on Board the from resigned Jon Productions. Channel 4 he was Director of Programmes at Five. He had He had Five. at of Programmes Director Channel 4 he was worked for Channel 4 as Head of Entertainment from 1998 to 1998 to of Entertainment Channel 4 as Head for from worked Strategy team. Jon is also a non-executive director of Artichoke Artichoke of director non-executive a also is Jon team. Strategy Retired at the balance sheet date sheet the balance at Retired Lygo Kevin 2001, and prior to that, at the BBC. Kevin resigned from the from resigned Kevin BBC. the at that, 2001, and prior to Joined the Board in December 2007 as Director of Future Future of Director as 2007 December in Board the Joined Jon Gisby independent advertising agency St Luke’s. Luke’s. independent advertising agency St initially joined the BBC in 1989. In 1994 she moved to Newsnight Newsnight to In 1994 she moved in 1989. initially joined the BBC has also worked at the BBC as Finance Director of BBC of BBC Finance Director as the BBC at has also worked his career in 1984 at advertising agency Benton and Bowles and Bowles advertising in 1984 at agency Benton his career House as Director of Finance and Business Affairs, prior to prior to of Finance and Business Affairs, House as Director member She is a lay Audit. of Internal and Head Productions of Broadcasters’ He is a Director July 1997. since Director on the Board from Sales. Andy resigned of Advertising Head David became Channel 4’s sixth Chief Executive in May 2010. in May Executive sixth Chief 4’s became Channel David he led the where of UKTV, Executive Chief this he was Prior to Manager and General President was David 2005-2007 Between of Skillset, the sector Director is also a non-executive David BBC Daytime. BBC Nick Swimer joining Channel 4, Anne spent three years with the Royal Opera Opera with the Royal years joining Channel 4, Anne spent three joining Channel 4, Jay Hunt was Controller, BBC One. Jay One. Jay BBC Controller, Hunt was joining Channel 4, Jay for TLC at Discovery Networks USA, where he oversaw all he oversaw USA, where Networks Discovery at TLC for to Chief Operating Officer on 4 June 2010, she was Interim was Interim she 2010, Officer on 4 June Operating Chief to Current of the G2 channel as Dave. re-launch Before 2010. 2009 - May November between Executive Chief and Chair of the Audit Management Board Corporate Disease Neurone of the Motor Trustee an elected Committee, Corporation Secretary Corporation which she was Finance Director at Carlton Productions. Anne Productions. Carlton at Finance Director which she was was General Manager of Discovery Networks UK. David began began UK. David Networks Manager of Discovery General was Sales Director since October 2002, having been Commercial been Commercial having 2002, since October Sales Director David Abraham David skills council for creative media. creative skills council for she was made editor of One O’Clock News before going on to going on to before of One O’Clock News editor made she was and was a founding partner and Chief Operating Officer at Officer partner Operating a founding and Chief and was as output editor and filmmaker and then to Panorama. In 1999 Panorama. to and then and filmmaker as output editor in 2008. the BBC to returning before 2007 content investment and strategy. Between 2001-2005 David David 2001-2005 Between and strategy. investment content and Honorary College London of the council of University edit the Six O’Clock News. In 2005 Jay become Controller of become Controller In 2005 Jay edit the Six O’Clock News. Audience Research Board Ltd (BARB). He is also Chairman of (BARB). Ltd Board Research Audience 1991 as council. He joined Channel 4 in Association’s Advertising Officer in JanuaryBefore 2011. Creative Chief Appointed Appointed Group Finance Director in July 2005 and promoted in July 2005 and promoted Finance Director Group Appointed Trust. Awards of the Teacher and a Trustee Association Anne Bulford FCA FCA Anne Bulford Andy Barnes 30 March 2011. 30 March Members continued Jay Hunt also worked as Director of Programmes at Five in Five at of Programmes as Director Hunt also worked Jay Executive members Executive Thinkbox, the television marketing body, and a member of the body, marketing the television Thinkbox, Hunt Jay Treasurer, a non-executive member of the Ministry of Justice’s the Ministry member of of Justice’s a non-executive Treasurer,

A A, R ACA ACA A A Member of the remuneration committee Member of the remuneration Member of the audit committee

R litigation practice having qualified as a solicitor with them. qualified as a solicitor having practice litigation United Football Club, a non-executive Director of Arcadia, of Arcadia, Director Club, a non-executive Football United honouree Fellow of the Institute of Sales and Marketing. of Sales and Marketing. of the Institute Fellow honouree Karren’s term ended on 30 September 2010. ended on 30 September term Karren’s EMI Music Publishing Ltd and Virgin Radio Ltd. Andy’s term ran ran term Andy’s Ltd. Radio and Virgin EMI Music Publishing Ltd Development at Unilever. at Development Mark is and The also Chair of Business in the Community member of the and a Board Countryside Fund Prince’s Monica also heads the firm’s consumer practice. the firm’s Monica also heads Europe’s largest travel and leisure website. In 2000 they floated floated they 2000 In website. leisure and travel largest Europe’s until 30 September 2010. until 30 September the business and Martha remained on the board until its sale. In In sale. its until board the on remained Martha and business the A Chairman of the Mothercare Group Foundation and an Foundation Group Chairman of the Mothercare Chrysalis plc and was formerly the Chief Financial Officer of the Chief formerly Chrysalis plc and was Officer of Ogilvy and Mather Worldwide, and Managing Director Worldwide, and Managing Director Ogilvy and Mather Officer of was the British council at Museum. Richard marketing of Corporate Head and Group of Staff Chief previously Consumer Goods Forum. Goddard LLP and head of the firm’s intellectual property intellectual of the firm’s LLP and head Goddard Superbrands, Giraffe Restaurants, Patisserie Valerie and Baker Baker and Valerie Patisserie Restaurants, Giraffe Superbrands, Monica Burch Karren Brady Karren Retired Johnson Luke Mark Price Richard Rivers venues and a growing online business. In 2007 she launched launched she 2007 In business. online growing a and venues she was Chief Financial Officer of BBDO EMEA, Chief Financial EMEA, Chief Financial Officer of BBDO Chief she was a grant-giving foundation, Antigone. foundation, grant-giving a a specialist permanent and contract staffing business. Until a specialist permanent and contract to thisAegis plc. Prior of Financial Officer Chief 2009 Alicja was Partners, Capital Risk of Chairman the is Luke 2010. January 27 of Chairman and owner part the is He house. equity private a Controls. APT of Director and owner major a and Spice, and 2005 she co-founded Lucky Voice, a karaoke business with five five with business karaoke a Voice, Lucky co-founded she 2005 executive Director and Chair of the Remuneration Committee Committee and Chair of the Remuneration Director executive plc, of SThree Director plc, and a non-executive Holdings of DTZ of J Walter Thompson. of J Walter Partnership. John Lewis of the on the Board and of Waitrose Plc and a member of the of Mothercare director executive Appointed Chairman in January 2004, his appointment ran until until ran appointment his 2004, January in Chairman Appointed Andy Mollett Alicja Lesniak 30 September 2013. Monica is Senior Partner at Addleshaw 2013. Monica is Senior Partner Addleshaw at 30 September Joined the Board in July 2004. She is Vice Chair of West Ham in July 2004. She is Vice Chair of West Joined the Board Joined the Board in July 2004. He is Chief Financial Officer of in July 2004. He is Chief Joined the Board Joined the Board on 1 October 2010. Alicja is also a non- 2010. on 1 October Joined the Board Joined the Board on 1 October 2010, he is Managing Director he is Managing Director 2010, on 1 October Joined the Board is also a non- Richard 2010. on 1 October Joined the Board Joined the Board on 1 October 2010. Her appointment runs until runs appointment Her 2010. October 1 on Board the Joined A, R

In 1998, with Brent Hoberman, she founded lastminute.com, lastminute.com, founded she Hoberman, Brent with 1998, In including six years as Chief Executive of the Financial Times Executive as Chief including six years becoming Professor of Economics in 1979. In 1980, he was was he In 1980, in 1979. of Economics becoming Professor Fox chairs the Race Online 2012 campaign and sits on the the on sits and campaign 2012 Online Race the chairs Fox Lords in 1997. in 1997. Lords He began his career in 1965 at the London Business School, Business School, the London in 1965 at his career He began a post he held until the Treasury, to Secretary Permanent Deputy Chairman Music, President of the Society of Business Economists, of the Society of Business Economists, Music, President and Social of Economic Institute of the National President Society. Economic of the Royal and Vice-President Research Lord Burns is of Santander UK plc and a non- Chairman Lord Luke Johnson as Chairman on 28 January 2010. His as Chairman on 28 January Johnson 2010. Luke RNID, the Royal National Institute for Deaf People. for Institute National the Royal RNID, Media Group, and was closely involved in setting up the BSB closely involved and was Media Group, Executive of Betfair Ltd. Previously he worked at Pearson plc, Pearson at he worked Previously Ltd. of Betfair Executive House of Lords. House, the Chair of the Cultural Olympiad, a Trustee of the a Trustee Olympiad, House, the Chair of the Cultural News. of BBC Executive Chief British Council and a former Stephen Hill Stephen until 31 March 2014. He is Chief Executive of the Royal Opera Opera of the Royal Executive 2014. He is Chief March until 31 ran until 31 January 2011 and has been extended until 31 January January 31 until extended been has and 2011 January 31 until ran also is She Board. Reform and Efficiency Office’s Cabinet MyDeco.com. and Spencer & Marks at director non-executive previous appointment ran until 31 January 2011 and has been until 31 appointment ran previous Chairman of the Governing Board of the Royal Academy of Academy of the Royal Board Chairman of the Governing Current private investment company, and Treasurer and Trustee of and Trustee and Treasurer company, investment private ran until 31 December 2010 and has been extended to to December 2010 and has been extended until 31 ran On 22 March 2010 he became a crossbench member of the 2010 he became a crossbench On 22 March lm producer, David now focuses on his interests in education in education his on interests focuses now David film producer, Lord Hall Lord Puttnam Lord Burns GCB Martha Lane Fox 2012. As the UK Government’s Digital Champion, Martha Lane Lane Martha Champion, Digital Government’s UK the As 2012. and is the Chancellor of the Open University. He was awarded awarded He was and is the Chancellor of the Open University. the House of to in 1995 and appointed a CBE in 1982, knighted appointed Chief Economic Advisor to the Treasury and Head and Head the Treasury to Advisor Economic Chief appointed appointment runs until Januaryappointment runs until 2013. also Chairman and Chief Executive of The Harbour Group, a of The Harbour Group, Executive also Chairman and Chief extended to 31 January 2012. After 30 years as an independent January 30 years 2012. After 31 to extended of the Government Economic Service. In 1991 he became Economic of the Government executive director of Banco Santander SA. He is of Banco also director executive consortium and its subsequent merger with Sky. Stephen is Stephen consortium with Sky. merger and its subsequent Appointed Chairman designate in November 2009, he replaced he replaced 2009, in November Chairman designate Appointed Appointed to the Board on 1 April 2005, his appointment runs on 1 April 2005, the Board to Appointed 1998, when he was appointed a life peer. a life appointed 1998, when he was

31 December 2011. From 2003 to 2005, Stephen was Chief Chief was Stephen 2005, to 2003 December 2011. From 31 Members Joined the Board in February 2006. Her previous appointment appointment previous Her 2006. February in Board the Joined Joined the Board as Deputy Chairman in February 2006. His as Deputy Chairman in February Joined the Board

Joined the Board in January 2006. His previous appointment in January His 2006. previous Joined the Board Non-executive members Non-executive

FINANCIAL REPORT AND STATEMENTS 148 FINANCIAL REPORT AND STATEMENTS 151 at

— — 41 41 £000 2010 December Balance

2009 Total £000 6 77 6 6 6 — 6 — — — 17 23 17 23 — 70 — 1,481 — 11 22 22 22 23 23 23 30 31 98 — year

811 450 528 — 429 318 £000 2010 364 785 606 513 Total during

2,996 3,851 lieu

in Notice

income Paid

statement the

at Recognised

December in

97 306 73 476 — — 41 41 (97) (306) (73) (476) Balance LTIP Pay 31 2009 £000 £000 £000

— — — — — 22 22 22 — — — — — — — — — — — — 30 — — — — fees Bonus Benefits payments of

167 — 8 73 181 408 84 13 306 — £000 £000 £000 £000 £000 Salary 1,913 303 123 476 181 and Kevin Lygo (resigned 30 April 2010) Nathalie Schwarz (resigned 26 March 2009) Non-Executive Members Lord Burns (appointed 28 January — 2010) Luke Johnson (resigned 27 January 2010) 356 Lord Puttnam 98 — 6 — — — — 8 — — — — — — — — — — members’ on Report continued remuneration Long-term incentive schemes incentive Long-term Andy Barnes (resigned 30 March 2011) Anne Bulford Jon Gisby Total on performance 2009 based to 2007 performance from Corporation to scheme linked incentive Andy Barnes joined a long-term of his advertising sales scheme bonus. In 2010 the a maximum of 33% of value up to objectives, Corporation stated against £97,000. Andy was under the scheme to payment Under the scheme, Anne 2009. to 2007 performance from Corporation to linked scheme incentive joined a long-term Anne Bulford a maximum of up to objectives, Corporation stated salary on performance 30% of her up to based against could accrue year each £306,000. Anne was under the scheme to In 2010 the payment 3 years. 90% over Members’ remuneration Members’ Executive Members David Abraham (appointed 4 May 2010) Andy Barnes (resigned 30 March 2011) Anne Bulford 324 400 123 96 81 13 — 97 — — Andy Duncan (resigned November 2009) 17 Jon Gisby (resigned July 2010) 19 — — — — — Sue Ashtiany (resigned 30 June 2009) David Abraham received an allowance of £81,000 during 2010 as part of his benefits package as a contribution to his personal to his personal as a contribution as part during 2010 package of his benefits of £81,000 an allowance received Abraham David pension plan. Anne Bulford In 2010, until May. Executive Chief of her time as Interim in 2010 in respect amounts earned additional Anne Bulford as member of the Corporate the Ministry of her roles services for from of Justice in respect in fees also earned £8,000 Committee. and Chair of the Audit Management Board for the base salary his benefits and contractual reflecting of £181,000 in lieu of notice payments total received Jon Gisby outstanding part period. of his notice Karren Brady (resigned 30 September 2010) Lord Hall Stephen Hill 17 Martha Lane Fox Andy Mollett (resigned 30 September 2010) Monica Burch (appointed 1 October 2010) — Alicja Lesniak (appointed 17 1 October 2010) Mark Price (appointed 1 October 2010) Richard 6 Rivers (appointed 1 October 2010) — 6 Total — 6 6 — — — — — — — — — — — — — — — — — — — — —

ts ts fi

of the Board Board the of

Ofcom appoints non-executive Board members for fixed terms and determines their fees. They are entitled to reimbursement of reimbursement to entitled are fees. They their terms and determines fixed for members Board appoints non-executive Ofcom a subject to are meetings. The service contracts Board in connection with attending incurred expenses and accommodation travel or less. years maximum of three Remuneration policy for non-executive members members non-executive for policy Remuneration ts which include a car allowance and membership of a private medical of a private and membership benefits which include a car allowance of taxable a range eligible for are members Executive no policy, expenses pensionable. In line with the group’s not These benefits are all staff. scheme which is open to insurance UK income tax. to chargeable were members executive claimed by expenses Taxable bene Taxable The service contracts of all the executive members are subject to notice periods of one year or less. At the balance sheet date sheet date the balance or less. At periods of one year notice subject to are members The service of all the executive contracts or loss of office. of contracts early termination for payable compensation for made no provisions were there Service contracts contracts Service The remuneration committee once again gave serious consideration to what form of bonus should be paid in respect of 2010 in respect of bonus should be paid form what to serious consideration gave once again committee The remuneration decided committee the remuneration review met and so after careful were performance targets performance. The majority of key bonus scheme, bonus Under the corporate the year. for agreed the scheme objectives to according bonuses should be paid that target A financial objectives. of personal and 20% on achievement 80% on the performance based of the group are calculations the bonus scheme. to set as the gateway was Following the difficult economic circumstances in 2008-2009, a pay freeze was implemented in 2010 for all staffbasic a in 2010 earning was implemented freeze pay a in 2008-2009, economic circumstances the difficult Following 2011 for a salary decided that additionally committee review end, the remuneration the year Subsequent to £50,000. salary over staff to earning less than £100,000. should only be awarded of the Board the of the remuneration by and approved on performance based and recommended are executives to made bonus payments Any and is targets advertising revenue to which is linked Scheme, Sales Bonus in the Advertising Andy Barnes participates committee. The of salary. scheme is under that 75% on performance. based The maximum bonus payable the year quarterlypaid throughout set the years in 2010 as in previous which Scheme, Bonus in the Channel 4 Executive participate members executive other incentive Long-term whose maximum bonus is 50% of salary. Abraham, David for except 30% of salary, at maximum bonus payable which measures commercial and strategic of corporate of a range the achievement subject to which were scheme payments, reduce long-term to Board of the It is the intention paid out in 2010. were and profit, revenue share, typically include viewing scheme. of the 2007-2009 after into the payment been entered have No furtherschemes in the future. extensions incentive The group continues to aim to attract, motivate and retain high calibre staff and executive Board members by rewarding them with rewarding by members Board staff and executive high calibre and retain motivate attract, aim to continues to The group participation including in certain in bonus schemes and salary cases participationcompetitive and benefit packages, in long-term of executives for prevailing salaries and benefit packages those to reference established by schemes. These are incentive to option schemes available of the share but without any the wider media industry, and in the television status comparable competitors. commercial most of Channel 4’s at executives The remuneration of executive Board members is determined by the remuneration committee, the membership and terms of and terms the membership committee, the remuneration by is determined members Board of executive The remuneration the to full consideration has given the committee policy, its remuneration In framing 145. detailed on page of which are reference Code. Governance of the UK Corporate provisions best practice Remuneration policy for executive members members executive for policy Remuneration remuneration members’ on Report

FINANCIAL REPORT AND STATEMENTS 150 FINANCIAL REPORT AND STATEMENTS 153 normal retirement age is 65. age is 65. normal retirement of a and of one-half in retirement of death in the event pension one-half of a scheme member’s pension of is a spouse’s there one-half of fit equal to bene is an additional in service. of death There in the event pension expected present scheme member’s maximum a to subject education, full-time in if 23 or 18, of age the to up child each of respect in spouse the to payable benefit the children. of two per annum compound, or the 5% at increase Minimum Pension, of the Guaranteed in excess of payment, pensions in the course if lower. prices index in the retail increase preserved date normal retirement a benefit from receive years after two being in the Plan for who leave scheme members of leaving. pensionable service the date to and pensionable earnings up to but relating as above, within the scheme, calculated a pension receives option retirement scheme member taking an early Any the age of 50. from option exists an early retirement rate. a discounted at cash. pension for part of the retirement exchange a member to for provisions are there members’ on Report continued remuneration From 1 September 2008 the scheme was closed to new members. The benefits provided to the members of the Channel Four of the Channel to the members The benefits provided members. new closed to was 2008 the scheme September 1 From as follows: Plan (the Plan) are Pension Staff Television — — — — — — pension scheme Jon’s towards contributions Scheme. Employer is the Channel 4 Defined Contribution a member of Jon Gisby in the year. £15,000 were information Auditable with in accordance KPMG LLP, auditors, Channel 4’s by been audited tables have and pension in the remuneration The information Channel 4. apply to to were requirements 2006 as if those Act 8 of the Companies Schedule of the Board Order By Lord Burns Chairman 2011 30 March Pension (continued) Pension 2010 value £000

December

8 626 2010 £000

value Members’ Transfer £000

members’ contributions at

Increase 2010 contributions during value transfer £000

January less

value £000

pension

members’ at

increase

Transfer at entitlement Transfer

2010 contributions £000 accrued of

December less

Total 4 2 14 34 52 29 147 523 68 95 13 228 in pension accrued

2010 £000

pension entitlement

Increase entitlement 31 during accrued

the total accrued pension entitlement shown is that which would be paid annually on retirement from the age of 60 for benefits benefits for 60 of age the from retirement on annually paid be would which that is shown entitlement pension accrued total the 2010. of end the to service on based but 2010 April 6 from accrued benefits for 65 of age the from and 2010 April 5 to up accrued earnings cap. of HMRC’s of the impact as a result been restricted have all members benefits for the accrued GN11. Guidance Note with Actuarial in accordance advice of actuarial on the basis been calculated have values all transfer individual members. to payable sums represent do not values the transfer

Kevin Lygo

— — — —

Andy Barnes (resigned 30 March 2011) 3 136 44 2,326 267 13 2,606

Non-executive members are not eligible for membership of the Channel Four Television Staff Pension Plan. The executive members members Plan. The executive Pension Staff Television Four of the Channel membership eligible for not are members Non-executive as follows: of the plan during 2010 were Pension Pension as all other Plan on the same basis Pension Staff Television of the Channel Four membership eligible for are members Executive of on 1/50th with a pension based members and provides of pensionable salary, 7.5% at The plan is contributory, of staff. members of final pensionable earnings. of service year a maximum of two-thirds each up to for final pensionable pay Payments made under long-term incentive schemes are not pensionable. not schemes are incentive long-term under made Payments Long-term incentive schemes (continued) schemes incentive Long-term Under the scheme, Jon 2010. 2008 to performance from Corporation to linked scheme incentive joined a long-term Jon Gisby a maximum of up to objectives, Corporation stated 20% of his on performance salary up to based could accrue against year each The of his performance in 2008 and 2009. in respect him to paid was £73,000 Jon left Channel 4 during 2010, As 3 years. 60% over balance sheet date. at the accrued entitlement (£41,000) remaining for Jon’s include provision 2010 financial statements remuneration continued remuneration members’ on Report

Anne Bulford

FINANCIAL REPORT AND STATEMENTS 152 FINANCIAL REPORT AND STATEMENTS 155 2009 5 5 4 4 3 4 4 2 14 12 21 377 77 79 45 45 39 37 93 91 58 60 49 54 86 85 66 70 4.5 N/A 2010

Compliance minimum

90 10 5 35 35 50 3 1.54 4 0.5 56 70 25 10 4 * * The 2010 Ofcom licence disclosure reflects Channel 4’s Digital Replacement Licence (DRL) which came into force on 28 December force Licence (DRL) which came into Replacement Digital Channel 4’s reflects licence disclosure The 2010 Ofcom 2003. Act out in the Communications set the requirements 2004. This encompasses for qualifying and UK legislation independent in the definitions contained in the European differences material are There production. of Media Statement page 11 of the detail on report discussed in more in this section of the are reflected of the measures Several of this report. 93 and on page Policy Content Programmes and the the and Programmes continued licence Subtitling for the deaf and hard-of-hearing Audio description Signing Regional Production Regional hours European origin Production in thenations Current affairs – overall – in peak-time pm) (6 pm 10.30 to Hours per year Schools Percentage Original production – overall – in peaktime pm) Independent (6 pm 10.30 to production European independent production E4, More4 (2009: being subtitled with 86% of these hours hours) and in 2010 (2009: 8,760 hours of 8,760 a total for The E4 channel broadcasts Film4 being subtitled (2009: 90%). of these hours with 96% (2009: 6,839 hours) hours 6,878 for channel broadcasts The More4 78%). subtitled (2009: 78%). being hours of these with 85% hours) (2009: 5,648 hours 6,009 for The Film4 channel broadcasts services. transmission delayed services all including +1 across reported previously were hours The digital channel broadcast Ofcom Code) and deals compliance with its Broadcasting (including licence obligations compliance with broadcasters’ monitors Ofcom infringement of privacy. and/or of unfair treatment and complaints in programmes standards with complaints concerning Channel 4 none the main Channel 4 service (2009: five), in 2010 by in programmes standards of its Code on breaches three recorded Ofcom in merit a statutory serious enough to judged 2010 no complaints about fairness/privacy sanction (2009: none). In of which were upheld (2009: two). were programmes Channel 4’s E4, More4 and and no recorded (2009: none) More4 against noted were in programmes of the Code on standards breach One recorded Film4 or Film 4 in 2010 (2009: none). In 2010 no complaints E4, against noted were in programmes of the Code on standards breaches upheld (2009: none). were or Film4 programmes on E4, More4 about fairness/privacy The licence Our licence from policy. programming Channel 4’s to is central the remit that shows of programmes and diversity The wide range on Channel 4. obligations certain places meet the remit, specific programme the need to stipulating to in addition Ofcom, Average hours per week News – in peak-time pm) (6 pm 10.30 to * % % 2009 £m 2009 £m

% % 77 79 23 21 42 40 58 60 £m £m 7.0 6.9 8.7 11.6 2.1 2.6 6.4 7.2 6.2 5.5 100 100 100 100 2010 2010 14.6 11.6 71.8 55.8 42.1 66.8 53.4 49.4 13.2 11.0 22.3 22.4 98.8 90.6 107.4 98.0 474.8 464.7 474.8 464.7 152.2 123.7 322.6 341.0 481.2 471.9 2009 2009 Hours Hours Hours Hours 39 49 216 217 237 318 373 353 150 143 929 888 394 346 2010 2010 492 501 699 653 Hours Hours Hours Hours 1,785 1,625 3,916 4,183 269.2 291.6 8,760 8,760 1,188 1,088 8,760 8,760 5,104 5,271 5,104 5,271 1,270 1,290 1,085 1,106 1,599 1,928 80.6 81.9 3,656 3,489 1,643 1,643

8,760 8,760 1,135 986

3,656 3,489

lms

hours

Peak Programme transmissions* Programme Production outside London Kingdom and has a Regions of the United and the Nations throughout production television film and encourage to Channel 4 is keen outside companies production supplied by programming cost of originated The total objective. that achieve number of schemes to million). million (2009: £117.0 £117.5 to the M25 in 2010 amounted Other direct programme costs reflect access services such as subtitling and sign-language services and amounts payable to music access services and sign-language services such as subtitling payable costs reflect and amounts programme Other direct collection societies. royalty Independent production companies are the most important source of originated programmes. 239 independent companies companies independent 239 programmes. the most important of originated are source companies Independent production on Channel 4 in 2010 (2009: 275). transmitted programmes provided

The data in the table above is based on reporting genres as defined by Ofcom. Data presented in the Statement of Media Content of Media Content Statement in the presented Data by Ofcom. as defined on reporting is genres based in the table above The data the example, For commissioning structure. internal Channel 4’s reflecting genres the key around (SMCP) is structured Policy of SMCP entitled The chapter the genres. across nature of an educational includes all programmes Education definition of Ofcom year olds. at 14-19 specifically aimed content educational to relates and Older Children Education

Quiz and gameshows Religion

Drama

Other Acquired Channel and costs of the channel’s The hours 4 day. each hours – 24 in 2010 (2009: 8,760) hours 8,760 The main Channel 4 service broadcast as follows: were transmissions of programme wide range Entertainment Education Feature fi Originated Originated Independents Acquired Other factual Originated

Channel 4 in the programmes and the ITV and purchases companies independent producers from Channel 4 commissions programmes in the shown 4 service on the main Channel in 2010 are transmitted the programmes and cost of The source markets. international table below: the licence the Programmes Sources of and Programmes programmeTotal and other content All Other direct programme costs Programmes total Sport Acquired Arts and music Documentaries Current affairs News

FINANCIAL REPORT AND STATEMENTS 154 Historical record

2002 2003 2004 2005 2006 2007 2008 2009 2010 £m £m £m £m £m £m £m £m £m

Consolidated results: Revenue 766.9 769.6 841.4 894.3 936.9 944.9 906.1 830.3 935.2

NANCIAL REPORT AN A S T N E M E TAT S ND A T R O P E R L A I C N A IN F Operating profit/(loss) 28.9 55.6 59.8 56.9 14.0 (8.8) (0.5) 3.9 49.3 Net financial (expense)/income (2.5) 0.2 3.9 9.9 7.3 10.0 13.7 (2.0) 1.8 Share of (loss)/profit in joint ventures (9.9) (10.5) — — — 0.4 (3.3) 0.3 2.9 Profit before taxation 16.5 45.3 63.7 66.8 21.3 1.6 9.9 2.2 54.0 Taxation (6.3) (11.0) (19.1) (18.3) (6.8) (1.1) (8.1) (1.9) (15.4) Profit for the year 10.2 34.3 44.6 48.5 14.5 0.5 1.8 0.3 38.6

Figures for 2002 to 2003 are shown under UK GAAP in force at the time. Figures for 2004 onwards are shown under Adopted IFRS.

Advertising revenue (portfolio)

2002 2003 2004 2005 2006 2007 2008 2009 2010 £m £m £m £m £m £m £m £m £m

Channel 4 655.2 662.4 720.2 769.3 777.1 825.2 789.7 706.7 794.2 Other 2442.3 2519.8 2695.3 2718.1 2522.9 2,608.2 2,486.8 2,179.3 2,514.9 Total broadcast 3,097.5 3,182.2 3,415.5 3,487.4 3,300.0 3,433.4 3,276.5 2,886.0 3,309.1

% % % % % % % % %

Channel 4 share 21.2 20.8 21.1 22.1 23.5 24.0 24.1 24.5 24.0 Other share 78.8 79.2 78.9 77.9 76.5 76.0 75.9 75.5 76.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Audience share (portfolio)

2002 2003 2004 2005 2006 2007 2008 2009 2010 % % % % % % % % %

BBC (nine channels) 38.8 38.3 36.6 35.2 34.5 34.0 33.5 32.6 32.9 ITV (five channels) 24.8 24.6 24.1 24.0 22.9 23.1 23.2 23.1 22.9 Channel 4 excl S4C (five channels) 10.6 10.1 10.3 10.8 11.9 11.7 11.8 11.5 11.4 Channel Five (three channels) 6.3 6.5 6.6 6.4 5.9 6.0 6.1 6.1 5.9 Other (>350 channels) 19.5 20.5 22.4 23.6 24.8 25.2 25.4 26.7 26.9 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

The figures in brackets indicated the number of channels in that portfolio as at 31 December 2010. Source: BARB all individuals

Audience share

2002 2003 2004 2005 2006 2007 2008 2009 2010 % % % % % % % % %

BBC 1 26.2 25.6 24.7 23.3 22.8 22.0 21.8 20.9 20.8 BBC 2 11.4 11.0 10.0 9.4 8.8 8.6 7.8 7.5 6.9 ITV and GMTV 24.1 23.7 22.8 21.5 19.6 19.2 18.4 17.8 17.0 Channel 4 excl S4C 9.8 9.4 9.6 9.6 9.6 8.6 8.1 7.4 7.0 Channel Five 6.3 6.5 6.6 6.4 5.7 5.2 5.0 4.9 4.5 Satellite and cable 22.2 23.8 26.3 29.8 33.5 36.4 38.9 41.5 43.8 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Source: BARB all individuals

156 157 158 159 Designed by NB Typeset by Bettina Brux Printed by PUSH

Channel 4 Television Corporation 124 Horseferry Road London SW1P 2TX

Telephone 020 7396 4444 channel4.com 160