STV boss sees positive times ahead

By Andrew Laughlin, Technology Reporter

STV chief executive Rob Woodward has predicted positive times ahead for the Scottish broadcaster, despite current tough conditions in the commercial TV industry.

Since he joined STV in 2007, Woodward has overhauled the ITV licence holder in Scotland with a radical programme of cost-cutting.
However, STV last month reported an 84% drop in profits and is also locked in an ongoing dispute with ITV after being accused of failing to pay a 22m fee to stay part of the ITV network.

Speaking to The Daily Telegraph, Woodward said that "every broadcaster has cut its cloth differently" in the current tough market, with all now operating within a "much lower cost base than anybody probably ever envisaged".

However, he said that he sees healthier signs ahead, with the added hope that the government and regulator Ofcom will offer greater support to boost the commercial TV industry.

"I'm more positive than some," he said. "It is not a systemic issue. We are going to be subject to a continued erosion, but there are a whole series of things that you'd hope the government will endorse which will help the commercial market."

As STV spends around 7m a year on producing news content, the broadcaster has thrown its backing behind an Ofcom proposal to use public money to fund the independent news production of Channel 3 licence holders in the UK.
In turn, Woodward would like to see Ofcom "refocus" its approach to regulation and not always adopt a "lighter touch".
"We're not asking them to calm down. They need to refocus on what the priorities are. And with the tension in the current Channel 3 situation, we would encourage intervention by Ofcom," he explained.

"At the same time that a lot of people are asking for a lighter touch, we'd also ask for them to be more interventionary."
Earlier in the year, the Office of Fair Trading began consultations on a relaxation of the Contract Rights Renewal (CRR), which works to ensure that ITV1 cannot unfairly dominate the television advertising market.

The CRR was a condition of the Carlton and Granada merger back in 2004 which formed the unified ITV group, but changes in the TV industry have since led the company to argue that this mechanism means it cannot get fair value for advertising on ITV1.

Woodward said that he would like Ofcom to take a firmer stance on issues such as the CRR, as the relaxation of this system and also freeing up product placement regulations could have a positive effect on the commercial industry.
He explained: "There is an idea that the audience isn't canny enough to recognise product placement for what it is. Now is time to look at that - particularly in the depths of a recession."

The chief executive also indicated that STV is "in the process of negotiating a number of ways for us to work more closely with the BBC", which would range from "technology and resource sharing, through to collaboration in news and sharing office space".
"The model that I'm outlining is one where the BBC acts as an enabler to commercial organisations," he said. "That's a more positive debate to be having."

Former Sky chief Tony Ball recently became the frontrunner to replace Michael Grade as ITV boss, and Woodward is broadly supportive of his suitability for the role.

"You always know where you stand with Tony," he said. "He's a very capable and commercial individual who worked wonders at Sky. You get clarity. He would be a strong appointment."