Jackson joins STV as senior executives take 20% pay cut

SENIOR management at broadcasting group STV will take pay cuts of up to 20 per cent as they shoulder the burden of the advertising downturn.

The move, which is expected to produce some £1 million of savings, was unveiled yesterday as Glasgow-based STV appointed former Channel 4 chief executive and media veteran Michael Jackson to its board as a non-executive director.

STV chief executive Rob Woodward, who is to take a 20 per cent cut on his £380,000 salary, warned that he could not rule out more pay cuts further down the organisation as the group told shareholders at its annual general meeting that there had been "no improvement" in market outlook in recent months.

Woodward said the pay cut would apply on a pro-rate basis from 1 May to the end of the year.

He told The Scotsman: "I don't think it is something we would do across all staff, but we will take a responsible view as we go through this year."

Pay is being cut across the company's senior "leadership team" amid the gloomy outlook, with chief financial officer George Watt – who earns £214,200 a year – taking a 15 per cent reduction.

The wider team of eight other top executives, including director of content Alan Clement, will see salaries decrease by between 10 and 15 per cent, Woodward added. The "leadership team" is not synonymous with the board and the pay cuts will not include chairman Richard Findlay.

Woodward said the firm had cut costs by about a quarter over the past 18 months as it carries out a sweeping reorganisation and restructure.

Findlay said that STV and ITV1 would be likely to trade "slightly behind" the overall advertising market – which is expected to be down around 20 per cent this month and next.

He said: "We will intensify our focus on efficiency improvements and cost reductions to mitigate any shortfalls in this unprecedented and challenging economic environment.

"The further cost reduction measures taken by the leadership teamdemonstrate the total commitment to shareholder value which characterises the coming together of your new board and leadership team."

Jackson, who has also held the post of controller at both BBC1 and BBC 2, will join STV's board on 1 May, from his current role as senior adviser to new media group IAC.

He said: "STV is a small business with big ambitions and a healthy growth plan and I'm delighted to be joining the board as a non-executive director."

Woodward added: "We have an excellent board and Michael adds a further positive dimension and brings outstanding expertise in broadcasting in North America and the UK."

He pointed to Jackson's experience in digital and online media in the US.

Yesterday's statement added that the cinema advertising market would be "materially weaker" than expected, hitting STV's cinema advertising subsidiary Pearl & Dean even further.

The group reaffirmed three-year-old plans to sell the business as soon as possible. Shares fell 6.6 per cent to close at 74.75p.

• Shares in commercial broadcaster ITV soared 11 per cent yesterday as traders cited market talk of bid interest from Italy's Mediaset. ITV declined to comment.

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Veteran adds media weight to board

MICHAEL Jackson has a long and illustrious broadcasting career spanning both the UK and US.

Most recently he has been working across the Atlantic as an adviser to internet conglomerate IAC, which owns search engine Ask Jeeves.

Jackson spent four years running Channel 4 before leaving the UK broadcaster in 2001 to be president and chief executive of IAC head Barry Diller's USA Entertainment. While at Channel 4, he was responsible for the commissioning of programmes such as Da Ali G Show, Queer as Folk and So Graham Norton.

He also worked on expanding the channel's digital operations, including launching two new channels, FilmFour and E4.

Prior to that, he spent more than a decade at the BBC, where he worked as controller of BBC1 and BBC2 and director of television. Meanwhile, in further changes to the leadership team at STV, former director of strategy and planning Anmar Kawash has become chief operating officer, while Bobby Hain's role is to change to director of broadcast services and regulatory affairs David Brook is to take on a temporary role as director of programmes and marketing and David Connolly joins the team as commercial director.