Thursday 27 October 2016

Game changer: Can the new boss tune RTÉ to challenging future?

With this week's loss of the Six Nations' tournament to TV3 - and mushrooming digital competition - the next Director General of the national broadcaster faces a massive battle to retain the station's audience.

Published 15/11/2015 | 02:30

Winds of change: Love/Hate has been one of RTÉ's big successes.
Winds of change: Love/Hate has been one of RTÉ's big successes.
The Ray D'Arcy Show (pictured) has struggled in the ratings.
The State broadcaster received a blow this week in losing the rights to the Six Nations in 2018.

There is a mood of anticipation in Montrose as staff speculate about who might take the top job of director-general when the present incumbent, Noel Curran, departs in six months' time.

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According to RTÉ insiders, the most likely successor is the Englishman, Kevin Bakhurst, who is currently deputy director-general. He became head of news and current affairs three years ago after serving as controller of the BBC News Channel.

One RTÉ broadcaster said: "If he wants it, he will get it. The fact that he is deputy shows that he is the anointed successor. Members of the board would like it that he came in from outside the organisation, and is less prone to RTÉ's corporate groupthink. He's learning Irish at the moment, and that would be a help."

A workforce that was cut by 20pc has been buoyed recently by the prospect of a pay rise, but in the middle of this week, the station suffered a shattering blow with the loss of the rugby Six Nations coverage to TV3 from 2018.

Big live events such as rugby internationals were still synonymous with the national broadcaster until recently. One thinks of George Hamilton uttering "a nation holds its breath" in a penalty shoot-out in Italia '90, and the banter between Bill O'Herlihy and the pundits.

But no event is sacrosanct any more, and it will be up to a new director-general to maintain RTÉ's status as a national broadcaster, rather than a marginalised network with an orchestra showing news, occasionally stimulating documentaries and bland lifestyle/cookery programmes.

There may have been a few false moves during his tenure, but Noel Curran will depart the role commanding considerable respect, not only from a good portion of staff, but also from those who dealt with the organisation from outside. He had to make tough decisions.

Pat Rabbitte, whose brief included broadcasting when he was Communications Minister, says: "He did a very difficult and courageous job in getting RTÉ to rein in its costs. From the point of view of the management of the public service broadcaster, I am sorry to see him go."

There have been a few noses out of joint during Curran's five-year stint in charge. Pay was cut at the station across the board, and for some of the top stars it was by over 30pc, and programme budgets were slashed.

There was the painful exit of Pat Kenny to Newstalk. Some felt the departure was down to money, but Pat himself has suggested that he might stayed if his programme, The Frontline, had not been axed.

As well as successes such as Love/Hate and the resilience of an institution like The Late Late Show, RTÉ continues to have its fair share of duds.

Although it may be too early to judge the success of Ray D'Arcy's Saturday night chat show, early indicators are not positive. By the end of its first month, the audience was half that of The Late Late Show - and no greater than the show it replaced, presented by Brendan O'Connor. Some of the hardest work may already have been done in trying to put RTÉ back on an even keel financially, but the new director-general will face an onerous job in trying to keep the channels relevant over the coming decade, as the younger audience threatens to go elsewhere.

One senior broadcaster, who has been closely involved in RTÉ management, says: "The problem for RTÉ is that old-fashioned linear TV, and the advertising revenue that comes with it is declining.

"Increasingly, families are not looking at a schedule in the paper or the RTÉ Guide and then planning to watch a programme at a particular time. Instead, you walk into a house and five people are watching five different screens - they could be mobiles, or tablets, and if they are under 25, they are not likely to watching RTÉ."

A major difficulty faced by the state broadcaster is that viewers have so much to choose from - including internet downloads, streaming services and satellite channels.

It is little surprise that ad revenue is seeping away from RTÉ when Irish advertisers can place commercials on 45 TV channels, not to mention websites.

The most important development in television this decade has been the massive use of Netflix and other internet services to download films and TV programmes.

Reed Hastings, chief executive of Netflix, which has 70 million subscribers, has predicted that traditional TV stations such as RTÉ will only last another 15 years. He has compared broadcast TV to the horse: "The horse was good until we had the car. The age of broadcast TV will probably last until 2030."

RTÉ has tried to keep up with rapidly changing consumer habits with digital channels and the RTÉ Player, as well as online news content.

Paul Moran, who monitors audiences for the advertising company Mediaworks, says: "The challenge is to commercialise all these digital channels. The audience is there, but the cost of running many of these services is high relative to the advertising income."

Some broadcasters suggest the predicted death of the traditional TV channel is much exaggerated. Sources in RTÉ say 90pc of programmes are still watched in the traditional fashion at the time they are broadcast. With vast corporations like Netflix and Amazon producing their own TV programmes, it may become increasingly difficult for RTÉ to buy popular dramas.

TV3 is also likely to be a tougher competitor, when it comes to acquiring programmes, under its new owner Liberty Global, whose main shareholder is the Irish-American billionaire John Malone.

Malone, who once launched a bid to take over Rupert Murdoch's media empire, has much deeper pockets than TV3's previous owners and is likely to take a long-term strategic view.

Increasingly RTÉ will have to rely on home-produced programmes including chat shows, news and current affairs to attract big audiences.

"There is still a big demand for home-produced programmes and that should be RTÉ's strength in the future," says Paul Moran.

This week, TV3 parked their tanks on the Montrose lawn when they snatched the Six Nations from RTÉ. The new director-general may find it increasingly difficult to keep some of RTÉ's other sporting crown jewels in the schedule. As the former rugby panellist George Hook said of RTÉ's loss of the Six Nations: "Money trumps everything."

Although TV3 is believed to have lost money broadcasting the Rugby World Cup, it won plaudits for its professional coverage. One broadcaster said: "The rugby was good for them, because they would have won over viewers who would not traditionally have watched the channel."

As well as the Six Nations there has also been speculation that RTÉ will lose the rights to the Olympics after 2016 to TV3. John Malone, the major shareholder in TV3's new owners Liberty Global, is also the major shareholder in Discovery, which owns the TV rights to the Olympics in 2020 and 2024.

RTÉ is still capable of commanding huge audiences on occasions. Last year's Late Late Toy Show was the most-watched programme on Irish television this century, with an average of 1.6 million viewers and a peak of 1.8 million. An ad during the commercial breaks for this year's Toy Show costs over €30,000.

Other programmes that have drawn audiences of over one million to Irish channels have included episodes Love/Hate. RTÉ will be urged to produce more home-grown drama. One executive at RTÉ says: "The station won lots of acclaim for Love/Hate, but domestic drama is expensive to make."

For every monster hit like Love/Hate there may be a few expensive flops.

The new director-general will have to convince the new government that a new funding model is needed for RTÉ. The traditional TV licence is considered outdated in an era when viewers may be watching programmes on laptops, mobiles and tablets.

As a way of collecting money for RTÉ, the current licence fee is notoriously inefficient, because it is estimated that 15pc of TV owners do not pay, resulting in a loss of €25m in earnings every year. One senior broadcaster said if RTÉ collected the licence fee itself, it would be a lot better off financially.

The idea of a broadcast charge, levied on all households to replace the licence fee, was scheduled to be introduced earlier this year, but the Government ran scared of it as it faced the uproar over water charges.

The new boss will face a struggle to secure funding from the taxpayer and advertising. Most importantly, he or she will have to be innovative in maintaining RTÉ's high audiences and relevance as the national broadcaster.

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