The government will push ahead with plans to privatise Channel 4 in a move it believes will allow it to compete against the streaming giants, City A.M. understands.
A government source said that after a lengthy consultations ministers have decided the broadcaster is held back by the “straitjacket” of public ownership
A sale, the source says, would give the Gogglebox and Great British Bake Off broadcaster “the freedom to innovate and grow so it can flourish and thrive long into the future.”
Channel 4 is publicly owned and though it does not receive public funds, restrictions that come with that status mean it has limited ability to borrow money or raise private capital, nor can it own or sell its own content.
The decision will be controversial with Channel 4 bosses warning last year that privatisation would not “be in the interest of either British audiences or the UK’s economy.”
Government sources were keen to emphasise that Channel 4 would be sold as a privately-owned public sector broadcaster, in a similar vein to ITV, which would include ongoing evening news programming.
“We will ensure it continues to make an important social, economic and cultural contribution to the UK,” the source said.
The government launched the consultation in July of last year. Many of those opposed to any privatisation suggested that a privately-run Channel 4 would not invest in production companies across the UK in the same way it does now.
City A.M. understands the government would look to reinvest the proceeds of the sale into what a source called a “creative dividend… putting money into independent production and levelling up wider creative skills in priority parts of the country.”
Government sources believe there will be a host of buyers interested in purchasing the broadcasting. Media analyst Ian Whittaker told City A.M. last year that ITV would be the most obvious fit.