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The possibility of Comcast taking over ITV has raised concerns about the consequences on British public service broadcasting, a reality that Channel 4’s new CEO, joining from a senior post at Sky, will be acutely aware of.

Sky’s ad sales head, Priya Dogra, will now be tasked to lead the charge to thwart her ex-company's acquisition bid to defend Channel 4.

The proposed merger of Sky and ITV’s TV business would leave Channel 4 a relative commercial minnow in the realm of TV and digital ad sales, reviving talk of the need to re-examine some form of alliance with the BBC for continued existence.

Foremost Worry: The Future of News

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

The surprise news last month that Comcast, which owns assets including Universal Studios and purchased Rupert Murdoch’s Sky for £30bn in 2018, makes commercial sense. Traditional broadcasters are facing a long-term existential threat as audiences and revenues continue to rapidly migrate to global digital players such as Meta, Google, Amazon, and Netflix.

“Comcast’s bid for ITV is causing trepidation among media watchers, with specific worry for news provision.”

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

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

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

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

Investment Promises and Regulatory Scrutiny

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

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

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

An Endangered Model

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

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

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

Strategic Imperatives

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

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

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

Regulatory Hurdles

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

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

Structural Challenges of Channel 4 and the BBC

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

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

The ongoing saga emphasises a larger conundrum for British media: how to maintain a domestic voice and a robust public service ecosystem in an increasingly globalised and digitally dominated landscape.