Why ITC must justify cut in fee for GMTV

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The marketing world will be amused to read that GMTV is applying for a 70 per cent reduction in its annual licence fee – down to 10m a year.

The industry will remember the former incumbent – TV-am, with its 70 per cent audience share in 1991 – bidding 14m a year for the new franchise. It was outbid by a massive offer of 34.6m from GMTV (and another, unconnected one of over 34m from another consortium).

Christopher Stoddart, managing director of GMTV, admits to cumulative losses so far of 30m – and sees no prospect of profit within the time frame of the franchise.

He claims that no one, not even former TV-am boss Bruce Gyngell, could have foreseen the changes in the breakfast-time market. What arrogant nonsense.

Of course Bruce foresaw that the growth of dedicated children’s channels, and more competition from stations like Channel 4 would dramatically reduce the audience share of the breakfast brand leader. It was inevitable. That was why TV-am bid what it did. The 14m is quite close to Stoddart’s revised figure of 10m isn’t it?

The Independent Television Commission should have rejected these bids on financial grounds. David Glencross, who was in charge at the time, had the power – but inexplicably failed to do so.

He was unable to comment at the time, but now he has retired, perhaps he could explain.

G Cleaver

East Ilsley

Berkshire

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