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Television Corporation Report and Financial Statements 2011 Incorporating the Statement of Media Content Policy

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Television Corporation Report and Financial Statements 2011 Incorporating the Statement of Media Content Policy Channel Four Television Corporation Report and Financial Statements 2011 Incorporating the Statement of Media Content Policy Presented to Parliament pursuant to Paragraph 13(1) of Schedule 3 to the Broadcasting Act 1990 Chairman’s statement 4 Chief Executive’s statement 6 Statement of Media Content Policy Financial Report and Statements Investing in creativity 8 Report of the members 124 Doing things the Channel 4 way 12 Report of the auditor 136 Film & drama 24 Consolidated income statement 138 Factual 34 Statement of changes in equity 139 Comedy & entertainment 44 Balance sheets 140 Spotlights 54 Cashflow statements 141 News & current affairs 70 Significant accounting policies 142 Education & older children 82 Notes to the financial statements 149 Making an impact 92 Corporate governance 181 Engaging the audience 96 Members 189 Thank you 106 Report on members’ remuneration 194 Awards 108 Programmes and the licence 198 Looking forward 113 Historical record 201 Assurance report 122 Channel 4 is required under the Digital Economy Act © Channel Four Television Corporation copyright 2012 2010 to publish a Statement of Media Content Policy (SMCP), outlining how it has delivered against its remit The text of this document (this excludes, where (as it is set in the Communications Act 2003 and the present, logos) may be reproduced free of charge in Digital Economy Act) in the preceding year as well as any format or medium providing that it is reproduced its plans for the year ahead. accurately and not in a misleading context. This SMCP is structured around the key genres through The material must be acknowledged as Channel Four which Channel 4 delivers its remit, as well as several Television Corporation copyright and the document ‘overview’ sections that give an over-arching look at title specified. Where third party material has been Channel 4’s creative investment and audience impact. identified, permission from the respective copyright Throughout the SMCP report, a series of ‘icons’ sit holder must be sought. alongside the case studies and public value measures The paper used in this publication is sourced from to highlight the parts of the remit that are being A description of the remit, as well as the process for responsibly managed forests and is a FSC certified This document is available for download from addressed. It also includes reference to the objectives selecting the public value measures, can be found in material. Printed in the UK by an FSC and ISO 14001 www.official-documents.gov.uk and from outlined for each genre in the 2010/11 report, to assess the methodology document that accompanies this certified printer. www.channel4.com/annualreport how Channel 4 has delivered against those objectives. report (www.channel4.com/annualreport). Chairman’s statement Chairman’s statement Key to any assessment of Channel 4’s overall As we entered 2012 there continued to be great performance is the balance of public and commercial uncertainty around the world economy. In my value. Across the schedules – from drama to professional life as an economist in the Treasury documentaries – our programmes demonstrated and elsewhere, I saw recessions come and go. public value, reflecting and questioning what life Many organisations will try to weather the economic is like in modern Britain and providing a framework storms by pulling back investment. The Channel 4 to help our audiences navigate the complex world Board, however, had taken a longer view: we believe around us. I particularly enjoyed Educating Essex's the right thing for Channel 4 – with its unique status, insights into life in a typical comprehensive school, its important role in supporting the creative economy Black Mirror's thought-provoking satire on society's and its prudent financial management of recent years fraught relationship with technology and Fresh Meat's – is to increase content investment in 2012. We aim take on contemporary student life at Manchester to increase audience share and impact by increasing University where I studied almost 50 years ago. content spend and, crucially, investment in original UK commissions. Amidst economic and political upheaval on the world stage, Channel 4 News provided comprehensive 2012 will be a big year for Channel 4 in a number of ways. coverage and rigorous analysis of developments I am looking forward to seeing the next phase of creative at home and abroad. Coverage of the crisis engulfing renewal reach the screens, to the broadcasting of the the Middle East was brave and powerful. For me, the London Paralympic Games, and to seeing the fruits standout pieces of journalism were the shocking but of continued evolution of the business model as we vital films about Sri Lanka and Syria which continue tackle the challenges and opportunities of convergence. to have impact at the highest levels of government at a national and international level. As the debate around the Communications Bill unfolds, I hope it will also be a year in which the economic, cultural As something of a digital obsessive myself, I also and social value of public service broadcasting – and enjoyed seeing the fruits of the new multiplatform Channel 4 in particular – continues to be recognised. strategy. Projects as diverse as Hippo: Nature’s Wild We look forward to engaging in those debates to help Feast, Battlefront and The Great British Property Scandal shape a future communications policy that will stimulate have all demonstrated the power of multi-media technological and creative development across the projects; and it was good to see the availability of creative industries in the years to come. Channel 4 News extended via its versions on mobiles and tablets and full programmes being available on At the start of 2012 there were also some significant 4oD by 9 pm on day of transmission. changes on the Channel 4 Board. David Puttnam stepped down from the Board and his position as The combined creative and commercial success in 2011 Deputy Chair after six years. David has been a crucially underlined that Channel 4 is a unique and special place. important part of Channel 4 and I pay particular tribute The strategy of commercial self-sufficiency that we set to his passion and loyalty to the organisation. Stephen out last year goes hand in glove with our public service Hill and Martha Lane Fox also came to the end of their delivery. It provides us with the independence to fulfil appointments. Each has brought tremendous insight our remit to innovate and experiment and to offer and rigour to the Board. I would like to thank all three a genuine point of distinctiveness. departing members. I am, however, delighted to welcome our new Board members who together bring This is the second year we publish a Statement a wealth of varied experience: Paul Potts, MT Rainey of Media Content Policy, which continues to perform and Josie Rourke. I am looking forward to working with an important role in ensuring that Channel 4 is them and welcoming their talents to the Board. I am 2011 was a critical year in the journey towards sustaining The board set some tough financial targets for the accountable in delivering this remit. The metrics also pleased to welcome the new members of the the level of independence and self-sufficiency channel at the start of 2011, and I am very pleased contained here are designed to assess performance executive team since the start of 2011, Jay Hunt, of Channel 4, and the achievement is all the greater to report the corporation performed well against these against the various elements of the remit, at both Dan Brooke and Jonathan Allan, and to bid a fond when set within the context of an uncertain economy. targets. The television advertising market was more a brand and individual programme level, including by farewell to Andy Barnes, who did so much as Director Creatively the channel is making an outstanding robust than expected and Channel 4’s own performance looking at how investment was made across the genres of Sales at Channel 4 for many years. impact on British audiences through the breadth and held up well. Over 1 billion pounds of revenue was and audience levels across TV and the digital portfolio. quality of its content, and commercially the organisation generated via the Channel 4 portfolio, including the As Channel 4 looks to its 30th birthday, it is a place full has exceeded expectations and is making a critical UKTV sales contract and other commercial activities. It is clear from these metrics that our content continues of life and vigour and optimism for the future. Channel 4 contribution to that creativity. As Channel 4 enters This was particularly impressive in a market that to resonate with audiences and that viewers recognise employees are full of passion for what the organisation its 30th anniversary year, it is satisfying to feel that continued to be highly competitive. It is a testament Channel 4 as leading the field in delivering to the remit. is here to do. I feel confident that Channel 4 has the organisation continues to innovate and meet to television’s enduring appeal to viewers and Channel 4 remains ahead of other broadcasters across the strategy and the people to continue to succeed its creative and commercial goals so successfully. advertisers even as convergence and the proliferation the metrics reported here. However, we also acknowledge creatively and commercially and to play an important of digital applications continue apace. Thanks to this a small narrowing in the lead over other broadcasters and entertaining part in British life. commercial success we were able to increase the overall in a number of areas. We might expect this in a year programme budget, and – importantly – invest more of radical schedule change, but the Channel 4 Board in new content commissioned from UK suppliers, while is not complacent about those results and will continue also generating a pre-tax surplus of £44 million in 2011.
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