A terrible indictment of Michael Grade's reign

Yesterday's Lex column in the FT maybe sums up the current state of play at ITV

It is a terrible indictment of Michael Grade’s reign as executive chairman that the company is unable to attract new tenants for its c-suite. With Sir Michael Bishop withdrawing his candidacy for the chairmanship, headhunter Russell Reynolds is again back to square one, days after Sir Crispin Davis, the previous favoured candidate, also left it in the lurch. How the headhunter must wish it had never won this mandate, which over the past six months has turned into a dismal advertisement for its capabilities.

Why Grade is steeping down

For a good analysis of the reasons behind Michael Grade stepping down as Cheif Exec at ITV read Robert Peston's blog

The reason is that the commercial broadcaster faces three significant strategic decisions - and ITV's board sensibly concluded that it would be inappropriate for those decisions to be taken by Grade more-or-less alone and then bequeathed to a new chief executive.
Better to appoint a successor, before the end of this year, to set the direction of the business which he or she would then have to travel.

Interestingly Peston spoke to Grade earlier today and he told him that

market conditions were tougher than they've ever been since ITV was founded more than 50 years ago. Which is particularly galling for him, in view of progress in improving programmes, reaching more viewers and in removing shackles imposed by regulators.

Libel battle of the century?

So we could be up for one of the court battles of the century if Michael Grade and Greg Dyke end up in the libel courts.

It has been confirmed this afternoon that the chairman of ITV is taking the former Beeb DG to court over a section of an article that he wrote in the Times over the circumstances of Grade's departure from the BBC governors to join ITV back in 2006.

Investor unease at ITV

It seems that some investors at ITV are not that happy with Michael Grade and want him to step down ahead of a possible share issue.

Following last week's results,the board are considering a £730b issue but according to the FT

some leading shareholders say they would only support such a move if Michael Grade stepped down from his position as executive chairman and worked alongside a new chief executive.

Investors,it adds

have become steadily disenchanted with the group, which last week scrapped its final dividend as well as the financial targets it set 18 months ago.

Grade comes out fighting

It was interesting listening to a rather bullish Michael Grade being interviewed on the Today programme minutes after ITV announced a 41% drop in pre tax profits,cutbacks in programming budgets and savings which will include 600 jobs being lost.

It is difficult to pin much of the blame on Grade who has been in the job less than two years and inherited an organisation which for whatever reason had lagged behind its competitors in the changing broadcasting environment.

That Grade acknowledged that was good to see as was his determination to build up the corporation back to the brand it was when it enjoyed a near monopoly position in commercial broadcasting.

Those days will never return but nevertheless Grade still sees content and image as the way forward and I would applaud him for that.

It is unfortunate that his plans for the network have coincided with the drop in advertising revenues and as a consequence,costs have to be brought in line with revenues.