A personal view on the demise of Thames

Thames Television was set up in 1967, under the joint ownership of the Associated British Picture Corporation and British Electric Traction (BET), and started broadcasting in 1968. The following year, the music group EMI took over ABPC.

By the 1980s, both Thorn EMI (as it had become) and BET had developed business strategies that made redundant their stakes in Thames. This was to prove very detrimental to the broadcaster.

In the meantime, the government of Margaret Thatcher was pressing ahead with its efforts to shake-up industry. It had sold off many of the assets that the Conservatives had inherited in 1979, and introduced sweeping industrial relations legislation to end the closed shop, secondary picketing and wild-cat strikes; tactics that in the previous decade the unions had employed so effectively and (to the government) devastatingly.

By the mid-1980s, Mrs Thatcher had turned her attention to broadcasting. One by one, the broadcasters started to use the new weapons at their disposal to reign in the unions. Bruce Gyngell locked out the TV-am unions when they went on strike, keeping the station on the air with a diet of cartoons and American imports. Ulster Television dismissed a union shop steward when he claimed too much time off sick in order to run his pub.

Thames faced strikes of its own. Technological advances meant, in some cases, that fewer people were needed to do the same job, which threatened redundancies.

However, it should also be noted that government income policies (read: wage freezes) in the 1970s severely restricted the opportunities for workers to increase their income.

In 1984 the unions walked out in protest over how many staff were to run the late night service, and their rates of pay, then again over the introduction of new technology for the news crews.

Thames responded by getting its own management to run the station. At first confined to films and repeats, the management service it put out was almost as successful as the normal service.

The company’s directors doubled as newsreaders, without autocue, although much of their material could well have been lifted straight from the Evening Standard.

From this point on, the successful management service would always be the nuclear option to be deployed against the unions. Only two companies, Thames and Ulster, needed to rely on it. In Belfast, its success sapped morale among strikers, who returned to work after two weeks.

At about this time, Thames’ shareholders were looking for a potential buyer for the company. They eventually signed a deal agreeing the sale of Thames, subject to the approval of the Independent Broadcasting Authority (IBA).

This approval was required, because the Authority had the power effectively to veto changes of ownership of ITV broadcasters. In extremis, if a company was sold in the face of the Authority’s objections, it could terminate and re-advertise a contract mid-term.

In the event, the Authority exercised its powers of veto, on the grounds that it would not be in the interests of Thames Television or the viewing public for the sale to go ahead.

The potential buyer said afterwards that his company should have gone ahead with the deal and risk disenfranchisement. The newly reconstituted Thames would have applied and probably won its franchise back. In the event, ownership remained with Thorn EMI and BET.

And the potential buyer? His name was Michael Green, chairman of Carlton Communications.

He tried again in 1989, when the rules on ownership had changed, but this time underbid. Instead, BET sold its shares to Thorn EMI, leaving the way open for Carlton to bid against Thames two years later.

Incidentally, BET selling up marked the end of an era, because it was through BET that Thames could trace a link, through Rediffusion, back to the earliest days of ITV in London.

In 1986, a committee headed by Lord Peacock delivered its report. Asked to recommend options for public policy on broadcasting, its main recommendation was that the BBC be funded in part by advertising.

It added, almost as an afterthought, that the ITV franchises, when next up for renewal, be auctioned off to the highest bidder.

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The Government’s 1990 White Paper on the future of broadcasting embraced this suggestion, which was one of the key proposals in what became the Broadcasting Act 1990. Interested parties would submit bids for each of the regional independent television franchises, and in each region the highest bidder would win.

The Act also set up the Independent Television Commission (ITC), which would take over responsibility from the IBA for awarding contracts effective from 1993 when the existing ones expired, and regulating the broadcasters.

The simple highest-bidder wheeze was widely believed to be the brainchild of the then Chancellor, Nigel Lawson. His view was that it didn’t matter a row of beans what was on the telly; the most important thing was to maximize Treasury revenue. And then, in October 1989, Mr Lawson resigned.

It was left to David Mellor, who took over responsibility for the Bill, to sort out which parts were to stay and which would go.

The competitive tendering provision was endorsed by the Prime Minister, Margaret Thatcher, herself and was unmoveable. Now, though, it was to be augmented with a quality threshold provision.

Applicants had to submit their detailed proposals. Those whose programme proposals did not came up to scratch, or whose business plans were unrealistic, would fail. There was also an “exceptional circumstances” clause, giving the ITC discretion to choose a lower bidder.

Thames’s response to what was at this stage still the Broadcasting Bill (it did not receive Royal Assent until some months later) was that it did not guarantee the company a licence.

Its Annual Report took some – perhaps too much – comfort in the fact that its track record could be taken into account, if the proposals of rival bidders were way short of the mark.

Too much, because the ITC had no specific powers to take into account an established broadcaster’s track record vis-à-vis paper promises.

When the bids were submitted, Thames had two rivals. A consortium backed by David Frost, called CPV-TV, failed the quality hurdle, so it came to a straight contest between the remaining two.

Carlton’s bid was £43m compared to Thames’ bid of £33m, so Carlton won the licence to broadcast to London from 1993 onwards.

For many, this marked the point at which ITV ceased to be a broadcaster of quality, popular programmes.

Thames steadily ran down its operations and staff, winding up its broadcast arm and transforming itself into an independent production company. It bowed out in familiar fashion, with a valedictory programme showcasing its achievements over the years.

Then a final speech from its Chief Executive, Richard Dunn, the news, Big Ben, and a happy new year from Carlton, “Television for London” as it styled itself.

And what became of Thames? It continued to make The Bill and other programmes for ITV, as well as the BBC and other broadcasters. It was eventually sold to the publishing company Pearson, and at the time of writing (2005) is part of the Fremantle Media group, owned by RTL.

So why should such a fine broadcaster, the lynchpin of the ITV network, be summarily dismissed? There are a number of possible reasons; conspiracy theories abound. A thousand straws in the wind that may or may not make up a bale of hay.

In 1988 British forces stationed in Gibraltar shot dead three people they suspected of being Irish terrorists. The IRA later confirmed that they had been a unit on active service.

In a subsequent statement to the House of Commons, the Foreign Secretary, Sir Geoffrey Howe, said that the security forces believed that their movements posed an imminent danger, and had opened fire partly because they believed, wrongly, that the unit was about to detonate a bomb.

The investigation broadcast by Thames caused uproar.

A “This Week” special, “Death on the Rock” upset the government of Margaret Thatcher, which put the IBA under pressure to pull the broadcast, the official reason being given was that it would prejudice the official inquiry yet to take place. Any unofficial reasons can only be a matter for conjecture.

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“Death on the Rock” is often cited as the reason that Thames was not re-enfranchised by the ITC in 1991 as the ITV London broadcaster.

ITV’s official history takes pains to demonstrate that the ITC’s evaluation of the competing bids was not open to such influence, even subliminally.

However, it admits that “a number of senior figures in the industry at the time do still believe [that] The Rock incident must have had some effect on the Thames decision.”

While the ITC could say, correctly, that it was free from political interference in exercising its powers under the Broadcasting Act 1990, it is undeniable that the thinking that shaped the act itself was far from free from such influence.

It is possible that Death on the Rock caused the Government to shape the legislation so as to be disadvantageous to Thames, and the by-now discredited (from the Government’s point of view) IBA.

Another factor that weighed against Thames was its ownership. At the time when the applications were being drawn up, Thames’s controlling shareholder was Thorn EMI, BET having by this time sold out.

And Thorn EMI wanted out. It was not going to throw money at the London licence that it would not get back from a future buyer. Nor was it prepared to pay through the nose for staff redundancies.

It was not going to allow the company ruthlessly to cut costs, as, say, LWT did, to free up more money for the bid, if the price to Thorn EMI was a net loss once it had disposed of the company.

Thames had to consider how much the London licence was worth. The Board settled on the figure of £30m in real terms.

Would Carlton have done any better with Thames? If it had succeeded in buying the company in 1985, would it have managed to restructure Thames, making it leaner and fitter for the bid? Also, would a Carlton-Thames board have had deeper pockets? One thing is certain: if everything else stayed the same, Thames would have won in 1991 because Carlton, as its owner, would not have been bidding against it.

However, everything else would not have stayed the same, so such speculation must remain nothing more than an interesting academic exercise.

And would the shape of ITV have been much different in any case? By 1993, the old system of scheduling, with majors and minors, was no more. A central scheduler decided what programmes were to be shown.

This change meant that the old Big Five (Thames, LWT, Central, Yorkshire and Granada) could no longer dominate the schedules with their offerings. Now, a minnow like newcomer Westcountry, or an independent like Thames or Mentorn, had as much chance of getting a good idea on screen as an established player like Granada or LWT.

In the event, Carlton’s tenure of the London licence got off to a shaky start. It commissioned a lot of experimental stuff from independent production companies, and got slated several times by the ITC.

The process of consolidation that was then underway, though, saw Carlton and Granada take control of all of ITV in England and Wales, before merging to form ITV plc.

Again, it can only be a matter of speculation whether the standard of ITV now would be different had Thames, under whatever ownership, remained within the ITV system instead of being replaced by Carlton.

Categories: History

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