Mergers are a traditional response to economic hardship so perhaps it’s not so surprising that someone is suggesting that Channel 4 and Five should “consolidate”:

“Consolidation could offer the prospect of both short and long-term benefits: immediate cost savings and an increase in scale in key markets from advertising sales to programme acquisition, but also the chance for a smaller number of larger players to focus on credible and affordable digital plans. If the goal is sustainable PSB beyond the BBC in the long term, consolidation may be part of the solution.”

The fact that it was BBC boss Mark Thompson who hinted at the prospect adds political overtones to the prospect of bringing the two minority channels together. Everyone knows that Channel 4 would prefer a deal that allows them to gain some sort of commercial advantange by teaming up with money-spinning BBC Worldwide.

How would it work for news? There was a time when ITN made the news for both 4 and Five but the latter now get theirs from Sky. That wouldn’t prevent the channels doing other deals but it might be difficult to sustain separate newsroom overheads.

What is interesting about the tone of Thompson’s piece is the recognition that this might not be the time for structural innovation. This seems to be squashing the last hope of Ofcom’s ill-fated Public Service Provider:

“The industry must now take the critical steps towards the major restructuring without which it cannot thrive in the UK or compete internationally. Let us avoid the temptation to create yet more new entities and new structures. What UK broadcasting needs is the same as the rest of the economy: simplification, consolidation and the right kind of public-private collaboration. Much of the solution will come from making sense of existing pieces not inventing new ones. This year I hope we see that solution take shape.”

For now, I am sure Thompson is right. Any day now Ed Richards and Ofcom will give Government their blueprint  for Public Service Broadcasting’s in 2012. That might get the sector through the current trough of despond. Some clever co-operation – and even consolidation – might prevent C4 and Five going into crisis. It’s just that ITV will resist a marriage of 4 and Five, while 4 would prefer to get into bed with the Beeb. This is more confusing than a Shakespearian comedy.
But ultimately the future of the UK PSB sector can’t be tackled fundamentally without serious consideration of the nature of the BBC itself.