THE inevitable bloodbath occurred at Richard Desmond’s newly acquired Channel Five yesterday as seven directors and more than a quarter of the 300 employees were given their marching orders.
The Northern & Shell and Express Group owner has promised further cost savings at the loss-making broadcaster but also an expansion of the programming budget to £300m a year over the next five years.
He will cross promote the channel in his celebrity-focused OK! magazine and no doubt there will be some favourable mentions of Five programmes in the Daily and Sunday Express.
Back in the 1990s, Lord Clive Hollick promised the same sort of cross promotion when he owned both the Express group and the ITV franchises such as Meridian, HTV and Anglia. But the strategy never really worked, both because the broadcasting regulations at the time were tighter and because ITV was not a single unified group.
Desmond’s chances of achieving cross fertilisation across his media must surely be higher. Imagine a new series of Big Brother promoted tirelessly in OK! and the Express and Star titles, with exclusive interviews, news stories and the like being shared across the group.
There will be no reticence on Desmond’s part about cross promotion, current regulations permitting. As far as I understand it, Channel Five will be allowed to plug Desmond’s newspaper titles so long as it does not give them undue prominence. And the newspaper titles will be free to plug Channel Five as much as their editors see fit (quite a lot, I suspect).
The key will be the extent to which Desmond’s growing media empire is successful in creating content that people want to view or read about. His ownership of the Express and Star titles may have been profitable but the Express and its Sunday stablemate have found it massively difficult to reverse circulation declines.
While the newspapers in Desmond’s empire are marginal players, the same is also true of Channel Five. This is no News International, whose brands, such as the Sun or Sky, are media powerhouses.
Nevertheless my prediction is that Channel Five, which lost £34m last year, will shortly become profitable. It will employ fewer people than before and it will be a fairly unusual place to work.
When Desmond took over the Express Group almost ten years ago, he quickly changed its culture and screwed down costs. Most remaining foreign postings were cut, staff numbers were reduced sharply and all expenses considered unnecessary were phased out.
My own favourite budget cuts story from the time relates, bizarrely, to uncooked pork. The features desk used to feature the recipes of a celebrity chef. Under a previous regime the recipe would be cooked by a known restaurant and the result would be photographed for the Express magazine. The new regime instructed that one of the department’s PAs cook the meals and then get them photographed on-site.
The plan back-fired when the PA in question, being Jewish, refused to handle pork, leaving it in its raw state for the photographer, whose picture of the uncooked meat adorned the feature page in the magazine. Life is unlikely to be dull at Channel Five.
Allister Heath is away.