ITV plc ENGLISH REGIONS AND BORDERS

ANNUAL REVIEW AND STATEMENT

16th December 2009

ANNUAL REVIEW 2009

Introduction & Strategy

The year 2009 was one of major change for news in the ITV English regions
and Borders. In our 2008 Statement we set out a plan for the re-structuring of
regional news delivery around eight service areas, six of them with 'opts' to
cater for the needs of the various sub-regions. In drawing up the plan we said
we would create a “well-resourced and sustainable service that will continue
to reflect the regions” and “maintain strong connections with the audience”.

We went on to describe how the plan would be underpinned with strategically

placed resources, skilled journalists and a continuing ability to be ‘live’ when
events and the moment demanded it.

We believe that the ITV regions have delivered fully on those plans and
aspirations. Through the application of the latest technology together with
skilled journalists, properly trained and equipped, we have established and
maintained coverage of breadth and depth across our regions.

We increased our connectivity by equipping almost 80 reporters across the

regions with cameras and laptops, enabling them to shoot and edit on
location. The addition of 3G technologies made it possible for the first time to
send both rushes and cut material from almost anywhere. This diminished
our traditional reliance on fixed offices and significantly increased our mobility.
The impact on our coverage was discernable. Whether it was in our response
to major and fast-moving stories such as the Cumbrian floods in November or
the production of set-piece events to mark the 60th anniversary of the D-Day
landings and the annual Armistice Day commemoration, the combination of
‘live’ reporting from the ITV regions’ network of satellite trucks and carefully
crafted reports gave ITV’s regional news a vivid and striking quality, always
close to the interests of our audiences.

The ‘opt’ strategy in six of the English news service areas has worked well
and has – through the efforts of technical, production and editorial staff who
designed the ‘opts’ – proved flexible enough to handle the challenges of a
changing news agenda. This means that we can extend ‘opt’ durations when
needed or go to complete pan-regional programmes (as was the case most
recently during and after the storms.)

Most importantly, while there was scepticism in some quarters about the
strategy, in key areas such as Border/Tyne Tees and West/Westcountry the
audience has grown year on year and is trending upwards as we reach the
end of the year. A 50% average audience share for coverage of the
Cumbrian floods demonstrates the degree to which viewers still prize ITV’s
approach to regional news.

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Significant Changes

Following discussions with Ofcom, public consultations and consultation with

ITV staff and unions, in February 2009 ITV introduced a series of changes to
the pattern of delivery of regional news.

Border and Tyne Tees combined to form a single news service with 15’ opts
in the early evening magazine to provide for each of the distinct licence areas.
The Border opt includes Cumbria, southern Scotland and – at the beginning of
the process – also included the Isle of Man. In accordance with the wishes of
the Manx Government and following public consultation on the island,
responsibility for news provision to the Isle was transferred to Granada in July
2009.

West and Westcountry amalgamated in a similar way, also with 15’ opts
serving Devon and Cornwall and the West of England.

Meridian became a single service licence with 15’ opts, one for the combined
Meridian South and Thames Valley areas and one for Meridian South East.

Yorkshire, Central and Anglia all became single services with 6’ opts for the
sub-regions within them.

Lunchtime and weekend bulletins became pan-regional within each service

area while the late bulletins remained largely focused on each of the sub-
regions.

No changes were proposed or made to the delivery of the London or Granada

services (aside in the latter case to the addition of the Isle of Man).

As part of the same review Ofcom proposed a reduction in the weekly

average of non-news programming in the English regions and the Borders.
The new target is 15’ per week – instead of the 1.5 hours of the previous year
– and is permitted to be contained within the slots allocated to the early
evening news magazines.

Tier 2 Arrangements

ITV will meet the requirements set out for regional news and non-news
material in 2009 by Ofcom. The average weekly delivery of 3 hours and 45
minutes in the English regions and Borders will be achieved. This will include
the delivery of 13 hours of non-news, largely current affairs.

Innovation, Experiment & Creativity

In many ways the success of 2009 were built largely on the need to innovate,
the urge to experiment, the instinct to be creative – all of it supported by
enthusiastic and committed staff in all departments of regional news.

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The development of the ‘opt’ strategy was at the heart of the new services in 6
of the 8 regions covering England the Borders. Depending on the demands of
the news agenda teams across the country have been able to extend the opt
durations or produce pan-regional programmes on the rare occasions these
were appropriate. In the Westcountry the story of Vanessa George and the
Plymouth nursery resulted in a 30’ opt – a whole programme effectively – as
did the trial coverage of terrorist plotter Andrew Ibrahim in the West.

Needing to cover large and complex areas, often with poor road and
communication systems, we have deployed staff and resources with
ingenuity. In Carlisle and Plymouth we opened new bases serve the major
opts in Border and Westcountry. In addition to the main news centres and
smaller bureaux we have located reporters in sites shared with colleges and
universities across the regions. Barnstaple, Gloucester, Northampton and
Leicester are all examples while many reporters – in Essex, in Cumbria and
the Borders, in Northumberland – work from home. Equipped with laptop
editing kit and Sony Z5 cameras, these journalists spend less time travelling
to and from bases, are closer to the stories as they occur and with 3G and
broadband connections can send back material more speedily than ever.

Anglia was able to break the story of a rural murder in Marlesford, in Suffolk in
a lunchtime bulletin with a camera-enabled reporter, a laptop and 3G
connection. The same technology and reporter skills allowed Border’s
Lookaround reporters to produce and edit short, up-to-the-minute flood
reports stretching from Ambleside in the south to Dumfries and Hawick in the
Scottish Borders giving the coverage a powerful sense of being truly local and
connected to the audience it serves. Meridian’s transport correspondent even
managed to send pictures of a new commuter coach service from a bus on
the M3 thereby scooping the competition.

The same bold approach has meant that regional news can now regularly
cover the activities of local people abroad and report on international events
that have powerful local and regional resonance. Central filmed on tour in
China with Birmingham Royal Ballet and followed a young boy to the USA for
life-saving proton therapy for a tumour.

ITV also re-launched ITV Local this year on the ITV.com site. As well as
making available the main early evening magazine programmes, the regional
news teams are also loading the main stories of the day up-dating them as
new information or pictures become available and will now break stories on
the site when possible ahead of the main broadcast programmes.

Programme Offer

News

The aim of ITV’s regional news programmes is to provide crisp, accessible

coverage of the main stories of the day and to reflect back to the audiences
we serve a real sense of where they live and what is important to them.

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In 2009 some major set-piece events dominated the agenda. There was
great poignancy to our coverage of the 65th anniversary of the D-Day landings
in which Meridian played a leading role. Not only did they produce
memorable programmes for viewers in the south but provided packages to
other regions featuring people of special local interest. In the same vein we
marked the 70th anniversary of the outbreak of World War II and the 65 years
since the Arnhem parachute drop. Armistice Day this year saw extensive
coverage by all of the regions of ceremonies across the country to remember
the war dead.

Of particular importance has been the coverage of British troops in

Afghanistan. We close the year with all of the regional news programmes
taking part in the ITV ‘Far From Home’ initiative in which we focused attention
on those serving overseas at Christmas. Two regional crews went on special
assignment to Helmand to gather messages from front-line troops which were
then played out through our regional news programmes in the seven days
leading up to Christmas. The same crews were also able to gather material
for other ITV programmes and in particular the GMTV service.

Many of the stories dominating our regional news programmes also became
major national and in some cases international stories too. Tyne Tees
devoted a programme to the memory of Sir Bobby Robson on the day he
died; Granada produced a moving memorial on the 20th anniversary of the
Hillsborough disaster and Central reported on the inquest into the deaths of
Fiona Pilkington, who killed her disabled daughter then committed suicide
after years of torment by neighbourhood gangs.

But it was in the midst of covering major and significant stories that the real
qualities of ITV regional news emerged. Border/Tyne Tees’ coverage of the
November floods was a supreme exercise in newsgathering. The strength of
the ITV News Group was demonstrated in the way in which we were able to
divert resource – in particular satellite trucks – from both Yorkshire and North
Wales – to assist with the coverage for both the region and the network. As
part of the continuing story Lookaround presenter Pam Royle accompanied
the 95-year old Mabel Proctor back to her flooded home to retrieve some
treasured possessions. It was a moving piece of television but also inspiring
to witness the indomitable spirit of this aged but remarkable woman.

Current Affairs

The inclusion of current affairs within the time allocated to regional news
encouraged the development of longer, more analytical pieces that brought
greater insight to some of the big stories and issues of the day.

The economic recession has been a continuing theme of the year and there
were very creative treatments of the story in a number of regions. Meridian
devised ‘Survival Street’ in which the residents of one Reading community
were introduced to bulk-buying, car-sharing and other money-saving schemes
in an effort to get them through the credit crunch.

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Central launched ‘The Panel versus…’ in which experts in business, personal
finance, recruitment and other skills were recruited to advise and help viewers
on the road to recovery.

Anglia took another aspect of the recession commissioning research to

uncover the damaging impact of the recession on many local charities already
hard-pressed for funds.

The addition of this genre into the news programme offer also resulted in the
type of coverage that broadens an audience’s understanding and extends the
tone and range of our programmes. Granada included an interview with
Manchester United’s Paul Scholes speaking for the first time about his
struggle with asthma as well as the graphic video diary of a Lancashire soldier
killed in Iraq.

Outside of the new programme each of the regions produced 11 late night
political programmes giving a specific regional reflection on the key political
stories of the day.

Additional Matters

Cultural and Other Diversity

Diversity is now a key part in all of our ‘Ideas Exchange’ sessions between
regions when they come together to discuss programmes and initiatives. It
has also become an integral part of all of our conferences and forums.

As part of the 2009 re-structuring ITV News Group appointed a Diversity

Manager to monitor all activity and work across the group. The Manager has
ensured the establishment of diversity panels in each region. He himself
represents ITV on the Broadcasting and Creative Industries Network and a
number of other advisory groups and panels.

The regional diversity panels review output and Central’s receives reports on
forthcoming features for comment.

ITV West’s diversity champion has set up a number of minority groups across
the region to gather
their views on ITV’s regional news and how it represents their various
communities. ITV West has also established close links with Bristol’s Somali
community resulting in an increasing amount of programme material from an
under-reported but significant group in the city.

Central co-ordinated and produced coverage for all of the ITV regions of the
2009 Special Olympics held in Leicester.

Media Literacy

Correspondents, reporters and newsroom staff from across the regions take
part in educational initiatives. Currently an ITV West correspondent takes part

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in regular teaching sessions with media students from Gloucester. Granada
runs a series of work placements with students from three universities across
its region and Central has added South Leicestershire College – where it has
based a reporter – to the list of institutions with which it works to promote
media literacy

Public Input

ITV’s regional news services encourage public input. In Yorkshire we have a

news ‘hotline’ through which viewers can offer comments and information
about stories they would like to see covered.

Tyne Tees established an email address for their main presenters with the
result that pamandian@itv.com has become one of the main ways in which
viewers can instantly feedback to the newsroom and the programme. Other
regions have also taken up the initiative.

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ANNUAL STATEMENT 2010

Introduction & Strategy

2010 will be another watershed year for ITV’s regions and in particular for the
regional news service.

In November 2009 the Government announced its intention to pilot three

independently financed news consortia in Scotland, Wales and in one English
region, the chosen region being Border/Tyne Tees. The timetable set out by
DCMS suggests that a preferred bidder will be identified by a panel to be set
up by the Department but that contracts will not be completed until after the
General Election. The new services are expected to be on the air by July
2010.

While ITV plc has declared that it will neither be a bidder in the process in its
own right nor participate any bid organised by others it will retain its position
as the broadcaster of the newly created service. It will therefore still have a
responsibility for the compliance of the service with the law and the Ofcom
Codes. As the broadcaster ITV plc will also have a proper interest in the
quality of the service provided, its fit with the style of ITV1 as a popular,
mainstream PSB channel as well as other considerations.

Beyond Border/Tyne Tees ITV will also adhere to the principles of quality,
reach and coverage that have underpinned its regional news services since
the re-structured regional plan was launched in February 2009.

However, it should be noted that ITV plc has indicated very clearly that there
remain significant economic challenges ahead and these will have to be
addressed in 2010. ITV has pointed out at some length that the cost of its
PSB obligations will begin to exceed the benefits derived from the licences
during the course of 2010 with the position worsening substantially in
subsequent years. Given the government’s policy commitment to ensuring an
economically sustainable balance between the costs and benefits of ITV plc’s
PSB licences clearly there will be a continuing dialogue in relation to regional
news and other PSB delivery by ITV in the years ahead.

Significant Changes

The introduction of independently financed news consortia will, if successfully

concluded, bring about the introduction of a new regional news supplier to ITV
plc in the Border/Tyne Tees licence areas.

The relationship with the IFNC will be discussed and agreed between ITV plc
and DCMS as part of the completion of the IFNC process. However, ITV
would expect that the new service in the designated licence area would
comply with Ofcom codes and be a proper fit with the aspirations and style of
ITV1 as the broadcasting channel as well as continuing to reach as large an

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audience as the programme currently does, providing real competition for
quality with the BBC.

Tier 2 Arrangements

ITV will continue to meet the regional news requirements of its licences
subject to the funding position set out in the Introduction & Strategy. Currently
in the English Regions & Borders ITV delivers 3 hours and 45 minutes of
news each week across the year. This results in an annual delivery of 195
hours across peak, near-peak, daytime and weekend slots.

Each region will deliver a total of 13 hours of non-news material largely

composed of current affairs and factual elements. This will be contained
within the slots allocated for the regional news magazines.

Programme Offer

News

ITV’s intention at the beginning of 2010 is to maintain the style, coverage and
reach of regional news programming it created in the successful launch of the
restructured services in February 2009.

Subject to the arrangements made between Ofcom, DCMS, the successful

IFNC in Border/Tyne Tees and ITV plc, ITV would expect to see the pattern of
opts continue in those regions as well as in West/Westcountry, Yorkshire,
Anglia, Central and Meridian.

We will continue to develop the connectivity through 3G and broadband

technologies that has so enhanced and enabled our coverage in 2009. The
ability to send pictures via a laptop from almost anywhere gave a strong
competitive edge to Border’s coverage of the Cumbrian floods late last year
and it better equips us to cover and reflect the regions in the way we aspire to.

To the best of our ability our news programmes will continue to provide live
reports from the main stories of the day via our satellite newsgathering trucks
as well as from our studios and bureaux within the regions themselves. The
aim is always to produce news programmes that reflect the lives and
concerns of the people who watch them and to maintain a sense of
connection with the audience that is unique to ITV’s approach to regional
news. The General Election will be the most significant story covered by the
regions next year. The aim once again will be to provide an accessible guide
to the unfolding story.

The style and nature of regional news will, of course, be subject to change
dependent upon the economic pressures applied and ITV’s continuing ability
to fund the service at its current level.

Current Affairs

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ITV recognises the continuing need to place current affairs and other
programme material within the slots allocated for regional news.

In 2009 we saw some very innovative current affairs programming embedded

within our regional news programmes, such as that devised by Meridian and
by Central to widen the audience’s view of the recession and work through
practical ways to improve family budgets.

We will continue to apply thinking like this to the current affairs agenda in
2010. We will also maintain the 11 regional political programmes on a
monthly basis. Mostly the programmes will be produced at ITV’s Millbank
studio in Westminster by the regional political team. During the election the
programmes will be brought back into the regions to be close to the
campaigns as they unfold.

Additional Information

ITV News Group will continue to develop the role of its Diversity Manager,
appointed following the restructure in 2009. The Manager will work with
regional diversity panels to ensure better representation both on and off the
screen and will be an active participant for ITV in a range of conferences and
forums. Local initiatives aimed at improving representation with minority
groups and establishing better links with these groups within the communities
we cover will be maintained.

ITV News Group will continue with its Training Scheme for graduates in 2010.
We will also continue the Internships it began in 2009 aimed at giving access
to people from backgrounds from which it might be difficult to break into
broadcasting, The intention is to provide an opportunity to experience the
industry through a regional newsroom.

We will maintain all of our initiatives to provide access to viewers.

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