Question to the Department for Digital, Culture, Media & Sport:

To ask the Secretary of State for Digital, Culture, Media and Sport, what assessment she has made of the ability of Channel 4 to compete with Netflix and Amazon following the privatisation of that station.

The arrival in the UK of global media and streaming groups means that Channel 4, as with other public service broadcasters (PSBs), faces growing competition for audiences, programmes and talent from new global groups with greater spending power. Netflix, for example, spent £779m on UK original productions in 2020, over two times more than Channel 4.

Channel 4 and these global streamers are necessarily different, but the markets Channel 4 operates within have been radically changed by the arrival of such competitors, and Channel 4 will need different tools to succeed in the future.

Under its current ownership model, Channel 4 has limited ability to borrow money or raise private sector capital by issuing shares. The current setup also effectively stops Channel 4 from making its own content. This means Channel 4 is heavily reliant on advertising revenues which are cyclical and also moving to digital platforms - linear TV ad revenues fell 31% from 2015 to 2020.

Private ownership could allow Channel 4 to diversify its revenue through greater access to capital and an ability to make and own content. This would drive investment at greater pace into content and technology, allowing it to compete more effectively with the likes of Netflix and Amazon without losing what makes Channel 4 so distinctive. The required investment to do this at scale and pace is best provided under private ownership, rather than leaving taxpayers exposed to the associated risk under public ownership.

The Government will set out the future of Channel 4 in a White Paper shortly.