The future of television: What next? 

26 December 2021 tbs.pm/74152

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From the Daily Mirror Spotlight on the Future of Television, published in 1958

“The profits of the various contractors should not be inconsiderable. This is all highly gratifying. But the public should not overlook the fact that without the risk capital invested at the start, without even a trace of security, the nation would still be without the television service which it has so manifestly shown that it prefers.”

— Norman Collins in the “Financial Times,” September, 1957.

The good fortunes of commercial television will excite comment and congratulation, but the comment will not be always favourable and the congratulations in some cases will not be forthcoming.

Such success so soon may well mean that the critics who feared that commercial television would have to set its standards low to capture advertising have nothing to fear after all. It may mean that advertisers have no chance of dictating to the programme companies, as was also feared, but rather that the programme companies will dictate to the advertisers. It may mean that commercial television has money to spend on research and on good quality, prestige programmes. It may mean that it can be entirely independent of government grants for programme “levelling” that aroused so much hostility. It may even mean that the medium is a resounding success.

Even so, commercial television has made an astonishingly large amount of money in an impertinently short period of time. Its opponents will find this very hard to forgive.

Already, for those who remain of them, they are planning what to do with the money. The Government makes about £55 million [£1.4bn today allowing for inflation] a year out of television — in purchase tax, licence revenue, and tax on television licences. But it is making nothing out of commercial television as such.

The opponents of independent television have several suggestions how the Government could clip commercial television’s wings :—

(1). An advertising tax. The pleasing fancy that advertisers should be taxed, either through a levy on their advertising budget or through disallowing part of their advertising budget for tax relief, is one that has caught the imagination of several M.Ps. It is an unwieldy idea, and one that takes no account, for instance, of the fact that the advertising outlay for a new product is an integral part of the cost of production.

(2). A limit on television advertising. At present advertising works out at an average of six minutes an hour, plus advertising magazines. This is the I.T.A.’s decision. But the Postmaster-General has power to alter the Second Schedule of the Television Act which says that “The amount of time given to advertising in the programme shall not be so great as to detract from the value of the programme as a medium of entertainment, instruction and information.” Some of the opponents of commercial television want to see advertising limited to the beginning and end of programmes, with no “natural breaks.” The result of this would probably be a rash of fifteen- and twenty-minute programmes.

(3). An increase in the rents paid by programme companies to the Independent Television Authority. It was suggested vaguely in one of the earliest television debates that besides the programmes paying an economic rent there should be “some arrange – whereby the corporation (i.e. the I.T.A.) possibly after an initial period, will share in the profits which the programme companies are making.” (Mr. Gammans, December 14, 1953). But the programme companies are already paying very heavy rents — even the smallest pay or will pay around a quarter of a million [£6.2m] a year — and have contracts taking them to 1964. However, no doubt the contracts could be revised under threat of what might possibly happen after 1964.

These are various ways in which the income of the television companies could be drastically limited. But they are limitations — and nothing more.

There is a fourth way in which the profits of the programme companies could be pegged to reasonable proportions:—

(4) Advertising could be spread over two commercial television programmes instead of one. With more programme companies in the field, income from advertising would be rationalised. The nation would get a third television network without any additional cost. Television would get the fillip of extra competition.

The way in which Britain’s third national television network would operate is already on paper.

It exists in the form of an agreement between the four big programme companies and the Independent Television Authority.

When Associated-Rediffusion, Associated Television, Granada and A.B.C. undertook to bring commercial television to Britain they were pioneering what was for this country a completely new and untried idea. The risks were enormous. They were told gloomily that they must be prepared to back themselves to the tune of two or three million pounds [£58m – £86m] apiece. The I.T.A. itself had no money, beyond the promise of a government loan whose limit was a million pounds [£29m] in the first year and two million in all. Before the first year was out these programme companies had between them some ten million pounds [£281m] in the way of capital, loans and guarantees committed to this hazardous venture. They were working completely in the dark, learning their own business as they went along.

In consideration of the enormous risks the four programme companies were taking, the Independent Television Authority entered into an agreement with them that:—

In the event of the I.T.A. opening up another national programme, these four programme companies would be given first refusal of the new contracts.

This means, in effect, that Associated-Rediffusion, Associated TeleVision, Granada and A.B.C. would be guaranteed a seven-day programme each in one or other of the big television arenas, London, Manchester or Birmingham. Only after they had been accommodated would new contractors be brought in to fill in the gaps in the new programme network.

The four programme companies would have to relinquish their present contracts. They would not necessarily be able to operate the new stations in their present areas — that would depend on the I.T.A. However, here is an example of how two-programme commercial television under this agreement could operate:—

LONDON

• First programme — Associated Rediffusion.
• Second programme — Associated TeleVision.

MIDLANDS

• Two new programme companies.

NORTH

• First programme — A.B.C. Television.
• Second programme — Granada TV Network.

And so instead of a “big four” operating on a limited number of days each, there would be a “big six” operating on a full week each. Two new programme companies would thus be needed for these major areas. New companies would also be created in the smaller regions.

Television advertising revenue would probably rise, but not proportionately. In any case the bulk of it would be divided between six major programme companies instead of four.

The I.T.A. would be able to fulfil its duty to “secure that there is adequate competition to supply programmes.”

There would be new blood and a wider variety of interests in commercial television.

The programme companies, able to operate all the week through instead of in segments of two days or five days, would find their scope increased enormously. The end of the segment system would bring better continuity.

The programme companies would have to compete not only with the B.B.C., which is not usually difficult to do, but with each other.

The public would have the choice of three television programmes.

Unusual 1960s advertisement for Fairy Snow washing powder, with spoken introduction by singer Craig Douglas turning into a catchy song

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