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By Lesley Foottit - 14th October 2009
The Lords communications committee has questioned executive chairman of ITV Michael Grade on the future of the troubled broadcaster.
The TV chief warned that piracy poses a real threat to the British film and television industry, as illegal downloading and live streaming become more prevalent.
Although ITV is free, and therefore the risk of great monetary loss through piracy is lessened, Grade still believes that it poses a threat and new legislation could be required.
He said: "Our lifeblood is our intellectual property and we have to protect it."
Asked if there is a remedy for the problem, he said: "I think it is extremely difficult. There are a number of legislative tweaks that would provide a greater deterrent for those who are thinking of pirating."
The topical issue of product placement was also raised at Wednesday's meeting.
Although product placement accounts for five to eight per cent of advertising revenue in America, Grade would not be pinned down to figures on how it would affect British broadcasters beyond saying that it would start slowly as advertisers learn how to use it.
"The truth is that nobody knows," he said. "Product placement is far less regulated in America and I suspect that we'll end up with tighter rules."
When peers criticised the 'Americanisation' of British television and suggested it may alienate UK audiences, Grade said: "At the end of the day, if we get it wrong, viewers will switch it off."
He added: "It is a hugely important step forward which will enable us to compete a little more with the wild west that is the internet. It will help and advertisers will welcome it."
The "wild west" internet was a contentious point for the ITV chairman, as he explained how the web is in competition with broadcasters, and winning.
"We face huge competition from the internet that is trying to chip away at our customer base. We need to be free to make the choices," he said.
"Online we're moving forward with some great plans. I think we're in very, very good shape to take advantage of the advertising recovery."
Grade, who is in the process of stepping down from his position at ITV, came under fire from peers, who accused him of overspending on digital channels and leaving terrestrial viewers out in the cold.
He defended the decision, saying the investment has been "great" for the channel and claimed they are providing what the viewers demand.
Baroness McIntosh criticised ITV's range of programmes, claiming that money is not evenly spent on children's programmes and cultural dramas, which have been "largely retreated from" in favour of popular series such as Britain's got Talent and X Factor.
Grade responded that "our model is based on high quality programmes", adding that after "losing 15 per cent of revenue overnight, fast short term decisions and cuts have to be made somewhere".
On the subject of film tax credit, he said: "We would welcome anything that would help more production. It would make a big difference."
"However, it is hard to see that this is a high priority for the Treasury," he accepted.
Grade denied that universities are not producing people who are qualified to begin work straight away.
He said: "There are no barriers to entry. People with flair and talent will always get into the industry."
Dods Parliamentary Communications Ltd