As I See It
Time may be right for TV bosses to switch off
Adam Crozier’s departure from ITV was unexpected but his contribution was judged positively, reflected in the share price which fell when the news broke. Clearly the City wonders if his successor will also be his equal.
It might be said that Crozier is leaving at the top. Job done, time to move on.
That would not be an unreasonable assessment after seeing ITV’s value rise 250% and revenue treble since he arrived from running the Royal Mail seven years ago.
The same may be said of his counterpart at STV where Rob Woodward last week also announced he would be stepping down, in his case 10 years after moving into the hot seat and setting about a root and branch restructure of what was then known as SMG (Scottish Media Group).
Mr Woodward’s decision was curiously timed the morning after the company launched STV2. It’s the company’s biggest project for some time and clearly carries some risk. Win or lose (and it is too early to judge) it represents a milestone in the company’s turnaround from its days as a mini media conglomerate. Should it succeed, Mr Woodward will be remembered for creating it. If it fails, he won’t be around to take the flak.
What the two CEOs may also share is a rather less rosy vision of the immediate future as advertising revenues in television begin to plateau. ITV has already seen a 3% fall – its first decline since 2009 – and performance overall is showing signs of slippage. Mr Crozier’s star may still shine bright in the City, but a failure to hit targets last year led to a 12% pay cut.
His successor faces a tough task building revenue from an advertising market now dissipated among a vast number of television channels, and increasingly on other platforms – mainly social media.
For all Mr Crozier’s efforts to find other income streams, ITV still earns half its revenue from advertising.
That also has a knock-on impact for STV which, despite its independence, is umbilically linked to the ITV network for programmes and advertising.
Mr Woodward bravely attempted to build a company less dependent on its bigger brother, controversially refusing to take some big ticket shows, such as Downton Abbey. He was forced into a u-turn and has struggled to find enough of a budget to invest in mammoth productions of its own.
Under his tenure STV Productions was successful in getting its first commissions from other channels, notably the BBC, without really making enough of an impression that the revenue earned would be transformational.
The presence of a pesky investor on the share register – the little known Crystal Amber – may also have been at the back of Mr Woodward’s mind when he was penning his letter of resignation. Crystal Amber has been agitating for change at Johnston Press – owner of The Scotsman newspaper – in which it has built a significant holding.
After his travails with ITV the STV boss wouldn’t want to be drawn into another distracting battle with a rebel shareholder demanding changes over which he had little control.
Curiously, Mr Woodward has been linked with Mr Crozier’s job. He has also been mentioned as a potential CEO of Channel 4, where another vacancy has emerged after David Abraham said he was leaving. There is also the prospect of a change at Sky following its takeover by Rupert Murdoch’s 21st Century Fox.
Between Crozier and Woodward, the latter looks the more likely to remain in an executive role in the business. He has 12 months of his contract to run, so we may have to wait some time to learn of his next move.