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BBC chairman Grade moves to ITV BBC chairman Grade moves to ITV
(about 6 hours later)
BBC chairman Michael Grade is to leave the public service broadcaster and move to its biggest terrestrial rival ITV. ITV has confirmed that BBC chairman Michael Grade is to leave the public service broadcaster early next year and move to its biggest terrestrial rival.
The move will be a blow to the BBC, where Mr Grade was steering it through complex licence fee negotiations with the government. Mr Grade will become executive chairman of ITV, which has been struggling with falling advertising and ratings.
Mr Grade said his first priority would be to improve programming.
The move is a major blow to the BBC, where Mr Grade was steering it through complex licence fee negotiations with the government.
'Tough decision'
He was also due to head the independent BBC Trust that was to replace the Board of Governors and oversee the BBC.He was also due to head the independent BBC Trust that was to replace the Board of Governors and oversee the BBC.
ITV has been looking for a new boss since Charles Allen left in August as the firm has seen advertising decline.ITV has been looking for a new boss since Charles Allen left in August as the firm has seen advertising decline.
"The timing of Michael Grade's departure to ITV could hardly be worse for the BBC," said Robert Peston, the BBC's business editor. It was an opportunity I could not resist Michael Grade, BBC chairman on ITV job href="http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/shares/3/26298/intraday.stm" class="">Check ITV's shares href="/1/hi/business/6190122.stm" class="">The future for Grade, BBC, ITV href="/1/hi/uk/6190116.stm" class="">Profile: Michael Grade
"As one member of the BBC board of governors put it to me, it's a mess." Mr Grade will run the company, and has committed to hold the post for up to three years.
Steadying hand Acting chief executive John Cresswell will work with him as chief operating officer, while chairman Sir Peter Burt will step down in March.
Mr Grade will take over as executive chairman of ITV on 1 January 2007. Mr Grade said it was a "great privilege" to take on the role.
He will run the company, and has committed to hold the post for three years. John Creswell will work with him as chief operating officer. "It has been a tough career decision to leave the BBC but it was an opportunity I could not resist, given my family's history in the founding of ITV and my own background at London Weekend Television," he said in a statement to the Stock Exchange.
The timing of Michael Grade's departure to ITV could hardly be worse for the BBC Robert Peston, BBC business editor href="http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/shares/3/26298/intraday.stm" class="">Check ITV's shares href="/1/hi/business/6190122.stm" class="">The future for Grade, BBC, ITV He added: "My first priority at ITV will be to support the team in accelerating the improvement in programming performance for our viewers and advertisers."
"Real coup"
Analysts said that Mr Grade was a charismatic figure who could restore confidence in ITV and help the company attract advertisers.Analysts said that Mr Grade was a charismatic figure who could restore confidence in ITV and help the company attract advertisers.
They added that Mr Grade was one of the few figures in the media industry with the experience and skills to take the helm at ITV.They added that Mr Grade was one of the few figures in the media industry with the experience and skills to take the helm at ITV.
"For the first time in ages, ITV executives can afford a smile," said the BBC's business editor. "They've got a new boss who has television in his blood. "For the first time in ages, ITV executives can afford a smile," said Robert Peston, the BBC's business editor. "They've got a new boss who has television in his blood.
I regard it as a real coup to have persuaded Michael Grade to join us Sir Peter Burt, ITV chairman
Question marks have hung over ITV's future in the face of rising competition from digital TV firms, low viewing figures and falling advertising revenues.Question marks have hung over ITV's future in the face of rising competition from digital TV firms, low viewing figures and falling advertising revenues.
Many analysts had predicted that ITV would become a takeover target, and satellite broadcaster BSkyB has bought a 17.9% stake in the firm for £940m.Many analysts had predicted that ITV would become a takeover target, and satellite broadcaster BSkyB has bought a 17.9% stake in the firm for £940m.
ITV had previously rejected a £4.7bn-takeover offer from cable operator NTL.ITV had previously rejected a £4.7bn-takeover offer from cable operator NTL.
ITV said Mr Grade's appointment was a "real coup" for the firm and he would bring "unrivalled broadcasting experience" to the business.
Left behindLeft behind
Analysts also called the defection of Mr Grade a coup for ITV. Mr Grade's departure is problematic for the BBC, which will be forced to appoint its third chairman in seven years.
"The timing of Michael Grade's departure to ITV could hardly be worse for the BBC," said Robert Peston, the BBC's business editor.
Mr Grade's move leaves questions for BBC boss Mark Thompson
"As one member of the BBC board of governors put it to me, it's a mess."
Mr Grade was heavily involved in negotiating an increase in the BBC licence fee, and has been pushing hard to win a rise of 2.3% above the rate of inflation.Mr Grade was heavily involved in negotiating an increase in the BBC licence fee, and has been pushing hard to win a rise of 2.3% above the rate of inflation.
While he has found a sympathetic ear in Culture Secretary Tessa Jowell, he was facing stiff opposition from Prime Minister Tony Blair and Chancellor of the Exchequer Gordon Brown.While he has found a sympathetic ear in Culture Secretary Tessa Jowell, he was facing stiff opposition from Prime Minister Tony Blair and Chancellor of the Exchequer Gordon Brown.
Mr Grade's move leaves questions for BBC boss Mark Thompson
One television executive said that Mr Grade may have decided to leave the BBC because of the changes to his job and his role as head of the BBC Trust, which would have seen him play a more regulatory and less hands-on role.One television executive said that Mr Grade may have decided to leave the BBC because of the changes to his job and his role as head of the BBC Trust, which would have seen him play a more regulatory and less hands-on role.
Observers said that it would be important to see how Mr Grade's role at ITV was defined - would he be there to guide ITV through the new digital age or would he be more involved in overseeing ITV1 and its programming schedule?
Jeff Randall, a former BBC business editor who broke the story in the Daily Telegraph, said that Mr Grade was "likely to have demanded a remuneration package of unprecedented riches" to make the move.
He added that: "There is carnage at the BBC: people are incandescent with rage."
Company reaction
The BBC issued a statement, wishing Mr Grade "well".The BBC issued a statement, wishing Mr Grade "well".
"Clearly this is a surprise, especially at this moment," the corporation said. "For the past two-and-a-half years, Michael Grade has been a great chairman.""Clearly this is a surprise, especially at this moment," the corporation said. "For the past two-and-a-half years, Michael Grade has been a great chairman."
It added that along with director general Mark Thompson, Mr Grade had achieved a successful charter settlement, while the future system of governance he helped secure would strengthen the BBC's accountability.It added that along with director general Mark Thompson, Mr Grade had achieved a successful charter settlement, while the future system of governance he helped secure would strengthen the BBC's accountability.
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