39.2 KT4 - The Thatcher governments and the media, 1979-90

Principles and Industry

Thatcher came to power in May 1979 with a political outlook that challenged much of the
post-war settlement. In economic policy this meant lower direct taxation, privatisation,
weaker trade-union power, competition, deregulation and a belief that consumers should
have more choice. In media policy, those principles did not produce a pure free market.
Broadcasting still used scarce frequencies, the BBC still had a public-service role, and
governments still worried about taste, impartiality, security and national unity. But the
direction of travel was clear: the old broadcasting world of BBC dominance plus regulated
ITV looked too closed, too producer-led and too protective of established institutions.

Use this table as the framework for the whole lesson:

The media industry was changing anyway. Cable television, satellite broadcasting, home
video, computerised newspaper production and advertising growth were all weakening the
older settlement. Thatcherism accelerated and politicised that change. Ministers argued
that restrictive practices in ITV and Fleet Street held back new entrants, new technology
and new talent. Critics argued that "choice" could be a polite word for commercialisation,
lower standards and greater private concentration.

The Peacock Committee, appointed in 1985 and reporting in 1986 on BBC finance, is a
useful bridge between principle and policy. Thatcherites were interested in whether the
licence fee could be replaced or reduced by more market-based funding, especially
advertising or subscription. Peacock did not recommend an immediate switch to BBC
advertising, but it did push the debate towards consumer choice, independent production
and a more plural broadcasting market. In that sense it helped prepare the atmosphere for
the Broadcasting Act 1990, even though it also showed that public-service broadcasting
could not simply be dismantled overnight.

The press industry shows the point especially clearly. In 1981 the government allowed
Rupert Murdoch's News International to buy Times Newspapers, adding The Times and The
Sunday Times to a group that already owned The Sun and News of the World. The deal
was not sent to the Monopolies and Mergers Commission because ministers accepted the
argument that the papers were financially weak and needed a quick rescue. This was not a
formal Thatcher media policy like the launch of Channel 4, but it mattered because it
helped reshape ownership at the top of the national press.

The Wapping dispute of 1986 then transformed newspaper production. News International
moved production from Fleet Street to a new plant at Wapping, using new technology and a
non-print-union workforce. Thousands of print workers were dismissed after the dispute
began in January 1986. The government did not run the dispute, but its trade-union laws,
its political sympathy for employers using new technology and the policing of picket lines
created the conditions in which Murdoch could defeat the print unions. For the newspaper
industry, the significance was enormous: computerised production, reduced union control,
lower labour costs and faster printing became harder to resist.

This is why Thatcher's media policy needs a broad definition. It was not only laws about
broadcasting. It was also a political climate in which media organisations were expected
to be more competitive, more technologically flexible and less protected by corporatist
bargaining. The price was that the boundary between media freedom and media power became
harder to draw. Breaking a public-service duopoly did not necessarily prevent private
concentration.

Channel 4

The launch of Channel 4 on 2 November 1982 was the clearest early example of Thatcher-era
competition in broadcasting. The Broadcasting Act 1980 had enabled the Independent
Broadcasting Authority to provide a second television service. In Wales, S4C was created
as the Welsh-language fourth channel; elsewhere Channel 4 became the new national service.

Channel 4 was not a straightforward privatisation. It was publicly owned and regulated
through the IBA, and its early advertising revenue was sold through the existing ITV
companies. Nor was it designed simply to chase the largest audience. Its remit was to
provide programmes that were innovative, experimental and appealing to tastes and
interests not well served by ITV. That made Channel 4 a compromise: commercially funded,
but with a public-service purpose.

The crucial structural innovation was the publisher-broadcaster model. Channel 4 did
not build a large in-house production base like the BBC. It commissioned programmes from
external companies. This helped create a much stronger independent production sector. For
students, that is one of the most important consequences of the topic: Thatcherite policy
did not only alter what audiences watched; it changed who could make television.

Channel 4 also changed the cultural range of British television. Its early programming
included news, current affairs, film, arts, minority-interest programmes, multicultural
programmes, experimental formats and more space for voices that did not fit comfortably
within BBC or ITV assumptions. This was not always popular. Some early press reaction
mocked it as dull or elitist. But by offering a fourth channel with a different remit, the
government made the broadcasting system more plural without simply abandoning public
service broadcasting.

The significance of Channel 4 should be judged in three layers:

Channel 4 also shows the limits of Thatcher's radicalism. Thatcher was often hostile to
the BBC and suspicious of producer power, but she did not simply sell Channel 4 into a
fully private market in the 1980s. The channel's public-service remit remained central.
The later Broadcasting Act 1990 changed Channel 4's status by creating the Channel Four
Television Corporation and moving it towards selling its own advertising from 1993, but
even that did not remove the channel's distinctive public-service obligations.

So Channel 4 is a key turning point because it joined two ideas that could easily pull in
opposite directions: competition and public-service difference. It widened the
market, but it also protected an alternative remit. That is why it is stronger evidence
for a mixed Thatcherite settlement than for a simple takeover of television by commercial
values.

Commercial Radio and 1990 Act

Radio helps you see change over time within the period 1979-90. Independent Local Radio
had begun before Thatcher, after the Sound Broadcasting Act 1972. The first commercial
stations, including LBC and Capital, launched in 1973. But the sector was still small,
highly regulated and cautious at the end of the 1970s. It was conceived as a complement
to BBC local radio, not as a wide-open commercial market.

Expansion resumed in 1980 after frequency reorganisation, so the growth of local commercial radio
became a real Thatcher-era development rather than only a 1970s
experiment. The IBA's 1987 yearbook counted 49 local radio service areas, served by 44 independent local radio contractors. In 1988
commercial radio stations were
permitted to offer different services on medium wave and VHF-FM, rather than simply
simulcasting the same output. This mattered because it made more efficient use of the
airwaves and encouraged more specialised formats. A station could begin to imagine
different audiences rather than one general local service.

The 1990 Broadcasting Act, passed on 1 November 1990, marked the biggest legislative
shift at the end of Thatcher's premiership. It created a new framework for a more
competitive broadcasting world. The Act abolished the old Independent Broadcasting
Authority structure and created the Independent Television Commission and the Radio
Authority. It was designed for a world of more services: local radio, national commercial
radio, cable, satellite and a more competitive ITV franchise system.

The government's own language stressed diversity, choice and competition. The Act
introduced lighter-touch regulation for many services and made it easier for applicants to
propose their own formats. It opened the way for national commercial radio licences,
which were awarded after Thatcher left office, including Classic FM, Virgin Radio and
Talk Radio in the early 1990s. That matters for chronology: the law belongs to the
Thatcher period, but some of its clearest consequences arrived under John Major.

For television, the Act also pushed ITV towards a more competitive franchise regime. Some
licences were to be awarded through cash bidding, though with a quality threshold. This
was a classic Thatcherite compromise: market discipline was increased, but ministers and
regulators did not abandon all programme-quality safeguards. Critics feared that high bids
would force companies to cut programme spending or chase safer ratings. Supporters argued
that the old system had been too cosy and opaque.

The overall significance is that Thatcher's governments helped turn broadcasting from a
scarcity-based public-service settlement into a more competitive mixed economy. The BBC
did not disappear. Public-service obligations did not disappear. But the assumption that
broadcasting should be organised around a small number of heavily regulated institutions
was weakened. Radio, in particular, became a field in which local, commercial and later
national alternatives could grow.