net1

The UK's Channel 4 and Channel Five are reported to be in talks about merging. The chief executive of Channel 4, Mark Thompson, confirmed that discussions had been held. Thompson has met United Business Media and RTL, the joint owners of Five, to discuss combining sales operations. But the talks are said to have widened and a full merger has been on the agenda.

The government would need to sanction a merger involving the publicly-owned Channel 4, and an act of parliament would be required to change its ownership. Given it is thought the Treasury would put a value of up to £2bn of C4, it is unlikely any ownership change will happen rapidly.

However, the appointment of catering entrepreneur Luke Johnson as chair of C4 is seen as a recognition by Ofcom that the ownership of C4 is likely to change and they wanted someone who would push it through.

A more realistic tie up with Five might see them share resources but continue with completely separate schedules on the model of BBC1 and 2. Ownership might be through a public trust. The talks – said to have been initiated by United Business Media, minority shareholder of Five – are a reflection of the two 'minnow' commercial broadcasters that they will not fare well in a landscape dominated by the merged ITV and Sky.