Kangaroo targets autumn rollout

Kangaroo, the internet TV joint venture between BBC Worldwide, ITV and Channel 4, is set to launch this autumn. The ITV chief operating officer and finance director, John Cresswell, speaking as ITV's first quarter-results for 2008 were published today, said the partners were hoping it would launch in September or October. Previously executives from the three Kangaroo backers had said it would go live by the end of the year.

Cresswell said that the BBC's outgoing director of future media and technology, Ashley Highfield, who will join Kangaroo as chief executive on July 1, would review the service when he joins and that there would be a be a beta launch before a full rollout. "It is going really well. Ashley's appointment is fantastic. With all new technical launches, you always have a soft launch before you unveil the whole thing," he added. It is about making sure that when the consumer gets to it, it won't fall over. No one wants a Terminal 5 online. We are pretty confident."

Speaking about ITV, Cresswell said the broadcaster's global content business would continue to work fine without its head, Dawn Airey, who stunned the broadcaster in late April by quitting to join Channel Five after only eight months. ITV announced today that the global content division had increased its first-quarter revenues from £41m in 2007 to £58m in 2008. "We will move on. We enjoyed working with [Dawn] but she has chosen to do something else. We have a really strong team in place. We move forward," Cresswell said.

He also reiterated the target for ITV Productions to secure 75% of ITV1's commissions, something Airey had previously described as "pretty remote". "In terms of our published targets and how people are remunerated, the targets are to grow the business and double the revenues [to £1.2bn by 2012]," he said. "75% is an ambition. I would love to get them as much of ITV's programme budget as I can and that is their target to get as big a market share as they can."

Cresswell said ITV was looking for further acquisitions to boost its global content business, following today's deal to buy Scandinavian independent producer Silverback in a deal worth £14m - with a cash consideration of £5.2m. ITV today told the City that its results for the first quarter of 2008 had seen revenue boosted by 3% year on year to £492m, with net advertising revenue also up slightly at 2%, although revenue from its broadcasting operation fell by about 2% to £409m for the period.

"We started the year well in all parts of the business," Cresswell said. "We are mindful of the economic context in which we are operating in but our business is in better operational shape than it has been for some years." He added that ad revenues were flat year on year - ahead of a wider UK TV market expected to be down 1% - which was a "good achievement compared to the market". "One of the really important things is that more people are watching commercials on ITV1 than they were last year," Cresswell said. "In a fragmenting world, we are very pleased with that."

He also revealed that the new ITV director of television, Peter Fincham, who took up his role on Monday, had been in contact with presenters Anthony McPartlin and Declan Donnelly, who found themselves caught up in the phone-in scandal that rocked the broadcaster last year. "Peter Fincham has been in touch with Ant and Dec and to reassure them of our support for them," Cresswell said.

Elsewhere, the ITV chairman, Michael Grade, today fended off shareholder attacks on his recent bonus, which was paid out when the share price was near an all-time low. Grade, who was paid nearly £2m in his first year as ITV's executive chairman, urged investors at the company's annual general meeting to be patient as he pushes through a multi-year turnaround plan. Although Grade said his overhaul was already bearing fruit, shareholders raised questions over ITV's share price, which has almost halved over the past 12 months.

One shareholder questioned Grade's dual role as chairman and chief executive - something which contravenes usual corporate governance practice - and accused him of hypocrisy for taking a bonus worth almost £1m last year. "Last year I stood up here and supported you in the dual role of chairman and chief executive against my conscience," the shareholder told Grade. "After supporting you, I decided not to put money in the bank but to buy more shares. I bought more shares, today those shares are down by 40%," he added. "You got £2m, that is hypocrisy. £2m for downturn at the company."

Another shareholder made a similar attack on Grade's pay. "This board is no more making the grade than did [Charles Allen," said the investor, referring to Grade's predecessor and also bemoaning losses incurred from phone-in scandals. "I think your performance is shoddy and unsatisfactory," he concluded, to some applause and shouts of "well said" from other shareholders.

Grade responded that his board was just eight months into a five-year turnaround plan and that he had never said an overhaul could be achieved overnight. "It's a plan that I think you need to take a view on in a few years' time," he said. "The first target we set was to improve the on-screen performance and I think we have done that very, very well," Grade added. "We are now outperforming our peers in the sector. We have to translate that into increased earnings and hopefully that will ultimately be reflected in an improved share price, but it's not a short-term project. We have a lot of work to do, all of that work is in hand now. Hopefully we will begin to get back to growth in 2009. So please judge us over the long-term," he said to widespread applause.

Grade added that the business was "in real decline" when the new management team took over and that he had made clear when he joined last year that there was "no silver bullet" to sort out its problems. Overall, he sought to emphasise that a recovery had already started, saying: "This business is in better shape today in terms of performance and trading than it has been for years."

Answering questions about Grade's pay, Baroness Usha Prashar, the chairman of the ITV remuneration committee, said his package was "market competitive" and reflected the need to keep someone with the right skills for to turnaround the business. Grade said it would be inappropriate for him to comment on his own pay.

Finally, the first chairman of ITV plc, Sir Brian Pitman, has announced he is to retire from the board of the commercial broadcaster. Pitman, who is 78 and named in the annual Guardian/RTF boardroom pay report as one of the oldest non-executive directors in the UK, has been on the ITV plc board since 2004. He became chairman of the broadcaster when ITV plc was formed from the merger of Carlton and Granada and moved to a non-executive director role when Michael Grade joined as chairman and chief executive at the start of 2007.

Pitman, who officially stepped down today following ITV's annual general meeting in London, was previously a non-executive director of Carlton Communications from March 1998 and is also a former chairman of Lloyds TSB. Despite his age, he was floated as a possible chairman of Northern Rock if Virgin had been given the go-ahead to take it over earlier this year.

Michael Grade, the executive chairman of ITV, said: "On behalf of the board and shareholders I would like to thank Sir Brian for his contribution since the merger establishing ITV and wish him continuing success in his business interests elsewhere."