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The possibility of the American media conglomerate acquiring ITV has raised apprehensions about the consequences on the UK's public service broadcasting, a reality that Channel 4’s new CEO, joining from a high-ranking position at Sky, will be keenly aware of.

Sky’s ad sales head, Priya Dogra, will now be tasked to take a leading role to oppose her former employer’s acquisition bid to protect Channel 4.

The potential union of Sky and ITV’s TV business would leave Channel 4 a significantly weaker competitor in the realm of TV and digital ad sales, reigniting talk of the need to re-examine some form of alliance with the BBC for continued existence.

Primary Concern: The Future of News

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

The shock revelation 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 decisively move to global digital players such as Meta, Google, Amazon, and Netflix.

“Comcast’s move for ITV is causing unease 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 autonomy, is full of regulatory, political, and competition issues.

Immediately, 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 controlling stake—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 is completed, the fate of ITN is an pivotal one that will concentrate attention politically,” says one senior TV executive. “Effectively, they will be involved in the news output of all the biggest non-BBC channels.”

Funding Guarantees and Regulatory Scrutiny

Comcast guaranteed to keep funding Sky News for a decade, raising its funding annually in line with inflation, as part of its 2018 takeover of Sky. As that commitment draws closer to concluding, 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 change the conditions of its public service broadcast licence, which includes obligations to national and regional news.

“There are clearly 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 wield power... I would hope Comcast appreciate 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 acquired 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.

A Call for Collaboration

There are those who believe that a Sky takeover of ITV, against the backdrop of the viewer shift to mostly US digital companies, heralds the need for closer cooperation 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 national strategic imperative. I think the government needs to work out how the boards of the PSBs have a new part to their remits that requires them to collaborate.”

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

Competition Hurdles

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

“I think it will get cleared,” 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.”

Funding Problems 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 inherent financial issue,” says Patrick Barwise, an emeritus professor at London Business School. “Channel 4 has repeatedly outperformed forecasts, but that is just delaying the inevitable. It’s now beginning to run out of road.”

The evolving situation underscores a wider question for British media: how to safeguard a independent voice and a healthy public service ecosystem in an increasingly globalised and digitally dominated landscape.