This is a City AM Studios production.
SPEAKER_01Hello and welcome to Business as Usual with me, Matt Kenyon.
SPEAKER_00And me, Simon Hunt. Coming up on the podcast, a major shake-up for the UK's media landscape as Sky buys ITV's broadcasting division.
SPEAKER_01And with a steady trickle of interviews and speeches, we are getting a clearer view of Andy Burnham's plan for government. But is the city going to like it?
SPEAKER_00Plus, we reveal the full economic impact of England's World Cup showdown against Mexico.
SPEAKER_01Welcome back to the podcast. Simon, very luckily you're already here with us, uh, signing in for Martin. Um, there's quite a few corporate stories for us to dive into today. I think we've all had our eye on this big media takeover. So Sky uh buying up a large chunk of ITV. Can you tell us about what's going on here?
SPEAKER_00Yeah, it's always a bit exciting being a journalist and reading about media MA. So I'm particularly interested in this one.
SPEAKER_01Inside baseball there.
SPEAKER_00Um, but uh no, this is a big um a big FTSE deal. Uh so Sky, which was uh once uh FTSE listed, is buying the broadcasting division of ITV for a fee of up to 1.6 billion. So it's uh slightly smaller than that, but there's there'll be some performance conditions attached based on how much um uh broadcasting advertising revenue they they bring in over the next year. But this is uh a sort of sign of consolidation in the market. The past few years, the British broadcasters have been up against the giants of the US streamers, the likes of you know Netflix and Disney Plus and and these kind of companies, you know, Amazon included. And they just don't have the financial firepower as these US streamers independently, and so they have to combine forces if they are to survive to stand up to these massive players. And I think that's what this is a reflection of.
SPEAKER_01It is interesting because I mean we've spoken before about how a lot of the strategy at Sky is being shaped by moving away from just having linear broadcasts and I know that Sky News are moving towards a more sort of YouTube focused, more streaming focused dynamic. I suppose is it a bit surprising that they're now buying up some of the most terrestrially focused bits of ITV? Because they're buying up a lot of the original commissioning, they're leaving behind some of the news stuff, which I suppose would be that's sort of parcel off still with an ITM. They are gonna have a stake. Well, which bits of ITV are going to fall under this new this new sky structure?
SPEAKER_00Yeah, so all all of the all of the terrestrial channels, that's ITV 1 up to 4, all of the um sort of streaming platforms that they have, like ITVX and the rest, uh, that's all coming over.
SPEAKER_01ITN is a bit of a strange one because it v itself So ITN is sort of that they're the they they're the production arm that they like license out a lot of uh ITV's daytime, they make channel five news, they make channel four news, they're quite a big conglomerate news.
SPEAKER_00Yeah, so they they do all of the new stuff, but ITV actually never had a majority stake in ITN. That has several shareholders, including I think the Daily Mail, the owner of Reuters has a has a stake as well. So that's actually going to be that that shareholding is going to be split in two. So after this um merger, ITV Studios, that's the bit that's left of ITV after they've sold that bit to Sky. They're going to own 20%, and Sky is also going to own 20%. So that does uh leave Sky News in a slightly confusing area where they will have their own separate newsroom, but will also have a share in another broadcast newsroom that that is technically their rival. So I mean, I don't know how you square that circle, but yeah.
SPEAKER_01Yeah, slightly confusing times for British television. Uh, but as you say, hopefully the consolidation uh at least gives them a fighting chance. Another thing, Simon, why is it that Accardo's chief executive has stepped down?
SPEAKER_00So this is a bit of a long-running battle within the boardroom of Accado. Tim Steiner, the founder, has been the chief executive for several years, uh, basically ever since it floated, but the shares have taken a real battering over the last five years, down something like 90%. And there have been moves to oust the CEO, both within the company and by certain shareholders who are not happy with the way it's been run by Steiner. They lost um a major um partner in the US recently, which caused their shares to take another hit. Steiner has had quite a storied tenure overseeing the company. A few years ago, he um left his wife and kids to shack up with a uh Polish lingerie model in her 20s, and that uh cast a bit of a shadow over his operation, his management of the company. Um, so there was something of a boardroom coup to try and oust him, which didn't exactly succeed. And there were calls by some shareholders to actually oust the board members who were behind that that putsch. Um what's ended up happening is Steiner has basically laid out um a path for his own exit where he will depart in the not immediately, but in the firm's 2028 financial year. And the in in slightly strange language, slightly strange uh phraseology, uh cardo has said that Tim will transition into a founder role. I'm not quite sure if you're a founder, how you can found the company already into a I mean, I don't how could you transition out of one? I don't know, but anyway.
SPEAKER_01So into a slightly less executive role.
SPEAKER_00I think that's what it means.
SPEAKER_01I suppose, I mean, yeah, you as you said, the the stock price has taken a massive hit statistically. I'm sure that no I'm sure that investors at the time when it first floated would not have expected this. Yeah. Could you give us a bit of a potted history of what went wrong with Accado's?
SPEAKER_00Well, so I think it initially it did do incredibly well. I suppose it launched and its pitch to investors was as an online grocery business. That was fundamentally what it did. It was trying to, you know, at the time, you know, 10-15 years ago, the uh major supermarkets did not have much of an online offering that wasn't that successful. So Ocado came in and took a big um corner of the market, but they then pivoted into describing themselves as a tech business because they then licensed out all of the robotics they developed for their warehouses to support other delivery operations. And for a while their shares uh absolutely soared on the back of that pivot into a tech company, but I think that has unraveled in in more recent years because their own tech hasn't been adopted as widely by other supermarkets, by other retailers as they might have hoped.
SPEAKER_01One more thing, Simon, very briefly. You've been writing about a crypto venture. It was backed by Nigel Farage, it's lost a pretty big chunk of its value over the last few months. What's what's happened there?
SPEAKER_00Yeah, so a lot of people might have seen uh the headlines surrounding reform leader Nigel Farage over the last few weeks concerning the £5 million gift he got from a crypto billionaire, and more recently, uh his ties with a uh convicted criminal who has also been heavily involved in both in reform and also in uh crypto gambling. Um so I thought I'd take a look at some of the investments that Farage has himself got him got got involved in. One of them is an a little acquis-listed Bitcoin firm called StackBTC, uh, which he invested in and became one of the biggest shareholders in back in March. Its shares are down by more than a third in the space of just three months. So it it was trading um at about 10p a few months ago. Retail investors were invited to buy shares in the company at 10p by via a retail offering. So any sort of average Brits who took part in that following Farage's investment, they would have lost a third of their value. But Farage hasn't because just days before the retail offering, he was offered the chance to buy shares in the company at 5p. So he's actually um still doing all right. His shares are up about 20%. But um, as I say, just days after he bought shares, the company then doubled the purchase price for the retail offering. So the retail investors who got involved are probably a lot less happy than he is with the investment.
SPEAKER_01Oh dear. Well, we will be following that story very closely. And we will also be back after the break with a discussion with our opinion editor, Alice Denby, about what we know about Andy Burnham's plans on tax devolution and more. Don't go anywhere.
SPEAKER_00Welcome back. In just two weeks, unless something absolutely extraordinary happens, in the meantime, Andy Burnham will be installed in Downing Street. The King of the North has become more talkative in recent days about his plans for power from tax policy to his blueprint to split number 10 in two. Our Westminster Watching Opinion editor Alice Denby joins us now. Um it felt as though there was in in the city a sort of a note of cautious optimism when uh talk of uh Burnham arrived because of the calibre of the people he was surrounding himself with. We had the former chair of Goldman Sachs, uh Jim O'Neill, we had uh Andy Holdane, formerly of the Bank of England. They were talking about, you know, scrapping the triple lock, uh unleashing economic growth. So there was a hope that maybe there would be some kind of a turning point. I would suggest to you that in the last three or four days, all of that has quite quickly unraveled.
SPEAKER_03Yeah, I agree with you. I think that markets are looking increasingly worried, especially um with the prospect of Ed Miliband as Chancellor. You know, Ed Miliband's is a proper socialist, right? He doesn't believe in free markets at all. Um, so that is naturally uh alarming for people. But look, I look at it another way. I think the reason why he was very openly taking advice from these heavy hitters you describe is because he knows that the economy is a weakness for him and he knows that the markets are going to be looking a scant, and it was a desperate attempt to reassure them. But I don't think some of the things he said since then have have done the trick.
SPEAKER_01I wonder if maybe Westminster needs to have a less trusting approach of when uh major political figures just start bringing in policy advisors they never seem to have actually met before. There was no there was no particular existing relationship between Andy Burnham and Andy Haldane. No. It did feel at the time like even then it could be just a bit of a comms operation, particularly because it doesn't look like Andy Burnham is going to be a Prime Minister led by advisers. It feels like, probably for the first time, maybe since Gordon Brown, we're gonna have a Prime Minister who is genuinely economically opinionated. That is maybe Liz Truss aside, because she is also quite opinionated. But do you do you think we have the measure of Andy Burnham's economic views now? Or do you think we still have some questions to be answered?
SPEAKER_03I think there are still questions to be answered. I'm still not quite sure I know what Manchesterism is. I think it's very clear that Manchester has been very successful. It's been successful in attracting a lot of private investment, especially around the football teams and so on. I'm not sure how that translates to the rest of the country that doesn't have those kind of pre-existing assets. You know, how how you regenerate a struggling coastal town in the same way that you regenerate, you know, a historic conurbation like Manchester. Some of the things he said, I think, will just, you know, have us all rolling our eyebrows, uh, recommitting to the triple lock. How many times can we say it's not sustainable?
SPEAKER_01That's unfortunate because he he was giving some signals, and certainly some of the economic advisors around him were definitely giving signals of this being the time when finally we can have a circuit break from that. It always feels like at the beginning of every premiership, you start with the political capital where you can get rid of the triple lock. So if not now, he's not going to become any more able to do that later on in his premiership.
SPEAKER_03Exactly. But I think you're right. I I think look, if he becomes Prime Minister in two weeks' time, you're right. This is this will be the peak of his powers. So we should expect something big, uh uh, whether it's capital gains tax, whether it's something to do with property taxes. You know, I actually think like if he could do something uh about making council tax more rational or introducing a land value tax, it would be bad for London, unfortunately. But uh, you know, council tax is an outdated uh tax and it does need reform. So that would be something I think I would cautiously welcome, albeit that it would be expensive for us in the city. But what else has he said? I mean, he wants to renationalise lots of utilities, including housing. I mean, how do you nationalise housing without undermining property rights? Yes.
SPEAKER_01And it also feels like the the sort of the major bit of infrastructure nationalization which he's giving signals of wanting to go towards is Thames Water, which despite all these signals towards Manchester is, as we know, an overwhelmingly southeast of England uh utility. So I do I do wonder whether he's going to be able to nail the economic message in the first few months when it's gonna be overwhelmingly about evolution uh about devolution and uh and utilities.
SPEAKER_03Yeah, and devolution is not the sort of thing that that necessarily gets the markets excited. I think it's also worth pointing out that Burnham's speculation and this kind of interregnum we're having already has economic uh distorting effects. So we're already seeing with rumours of capital gains tax, we're already seeing uh businesses realise their assets to try and avoid a higher rate. Um with terms of water, we had uh ministers around Andy Burning sort of signalling desperately to him that they're super left wing and therefore rejecting um a rescue package from private investors.
SPEAKER_01You know, that's that's a a damaging thing to if that was based on just jockeying, then that is a very that's a very corrosive way of doing it.
SPEAKER_03That's certainly what it looks like to me.
SPEAKER_00But is there is there still a faint glimmer of hope? Is there still a world in which the Jim O'Neills of this world will still have the ear of Andy Burnham once he steps into Downing Street? And is there even a world in which he could save the exchequer money by moving Parliament to the north and thereby swerve the 40 billion bill that uh is the current estimate for how much it would cost to refurbish uh the Houses of Parliament if the Commons were still sitting around the refurbishment?
SPEAKER_03No, I think this whole idea of moving number 10 to the north is just a distraction. I think it'd be a huge waste of time. I don't think it would save you money on the refurbishment of Parliament because you're gonna have to spend the money restoring it anyway, right? So I I just think that that that this will very I don't think this will make it till Christmas because Andy Burnham's not gonna spend his whole time on the train between Manchester and London. That's uh if it's a Vanity West Coast.
SPEAKER_00I mean he won't spend all of his time just on the train on that basis.
SPEAKER_03Um a huge waste of his own time, which is after all like the most valuable kind of resource a a Prime Minister has. Look, I think this is gonna be much more like what we had with Rachel Reeves. Um, she can go around making the right noises to businesses, convincing them that she knows what she's doing, and then it will very quickly prove the opposite.
SPEAKER_01Well, Alice will be checking in uh as the next few weeks and months go on to see how these predictions hold up. But for now, thank you very much, and we'll have you back in the podcast very soon.
SPEAKER_03Absolute pleasure.
SPEAKER_01Finally, this week, I think it is pretty fair to say we have had the booziest Monday morning in British history. England. At least uh in terms of uh 3am and 4am pub drinking. Uh that is, of course, because of the England-Mexico match uh that catapulted uh the three lines uh into the course finals and was pretty impactful for pubs. There was a uh a dispensation given from Keir Starmer that pubs could stay open basically all night.
SPEAKER_00Uh finally a legacy for Keir Starmer.
SPEAKER_01Yeah, legacy, probably his one of his proudest moments. He's put all sorts of fun TikTok videos. If anything, it feels like he's sort of regaining his mojo at the very end. What, though, is the economic impact of this? Well, that's what we'll dig into now. We have our deputy sports editor, Matt Hardy, here with us. Hello. Hello. I'm very tired. Yeah. Yeah, so full disclosure, so we're recording this sort of later on on uh on Monday. So we're like some very brave souls in the office, including yourself, uh also Alice from the previous segment, did tactically stay up. You seem to have done quite a wise thing of going to sleep and then setting alarm and waking up just so you'd got some headway.
SPEAKER_02Yeah, I think I I'd still manage six, seven hours sleep, so I think I've done well. But look, I wasn't one of those people down the down the local boozer, and maybe I should have been, because the atmosphere across the country's been great. Yeah, look, we we think a run to the final, according to some financial data, could be worth a quarter of a billion pounds in retail and spend data. Because we've got some very well-timed fixtures. We do. So going on now, Saturday, 10 pm, and then an 8 if we win, obviously, against Norway, an 8 pm in the middle of next week, and then an 8 pm the following Sunday. So it's it's nice times from here on out. Nice Sunday roast and a and a bit of football. It should be brilliant. And and you look at kind of I think the BBPA, the British Beer and Public Association were saying that every game is kind of worth 20 million in pints. So over a run of a World Cup, that's not five, 200 million either.
SPEAKER_01It'll be interesting to see when any data is done post the fact, but they were I was talking to them on Friday when we were doing a bit of a preview of this match, and they suggested that it could be as many as a million pints sold overnight on a Sunday, which just must be such orders of magnitude higher than whatever the previous Sunday night record was.
SPEAKER_02I mean, you've got to think I there was some data from from Heineken today that said year-on-year sales are up 4,000%. Obviously, the problem is this time last year the pubs weren't open. So I mean it's quite hard to quantify.
SPEAKER_01Yeah, it could be like in terms of the 2am on a Monday morning, it could be like a billion percent increase if the yeah, if it's zero.
SPEAKER_02But I feel like Brits on the lash is is something that kind of comes and goes with with sport. And we're in this amazing moment at the moment where hospitality's been kind of shoved around by by the Chancellor in in her budget last year. Yet we've got thousands upon thousands of people. I think we've been, I'm not sure about you, Matt, but uh Wimbledon over the last two weeks, Queens, Henley, uh, the boat race, the Cell GPs coming down to Portsmouth at the end of the month, the football, there's been a women's T20 Cricket World Cup. You know, all of this is not just sport, it's people going out for a meal, spending money, buying merch, and kind of investing back into the economy.
SPEAKER_01But in enough about the average Brit, let's talk about the ultra wealthy. You've been writing something extraordinary about the the sort of scale of the price tags that some of these tickets for sort of the courses, the semis, and the finals are going to see. What what kind of numbers, what sort of insane numbers are we looking at here?
SPEAKER_02So I've had a little look around for the Miami Stadium, formerly the Hard Rock Stadium, it's where the Miami Dolphins play the NFL. One of our colleagues is heading out there, so it should be good fun. But I did spot a ticket for eight million dollars. Eight million. Eight million dollars this morning. I have only seen that topped by a ticket, funnily enough, at the same stadium between Brazil and Scotland in the in the group stage, which was 11 million. So I've an 8 million pound or dollar ticket. And basically, what this is is anyone can resell their tickets. Um and I imagine a lot of this are Brazilian fans who thought, or Mexican fans who thought they'd beat one of England or Norway, going, hang on a minute, there's no point me going to Miami, let's try and make some money back. But you can get there for a meadsly two and a half grand, Simon.
SPEAKER_00So well, suddenly when that England fan famously said that he'd sold his house to get a ticket. Starting to sound a bit less far-fetched now, isn't it? When you when you hear those sorts of figures.
SPEAKER_02Yeah, well, it's kind of crazy, and and I think I've had a little look going forward as well. If we do beat Norway, this is still a week out. England would have to beat Erling Haaland's Norway, but tickets are going up to 800 grand for the semi-final, and you're looking at 111 grand for the final. So there's some arguments. Yeah, it's kind of up there. It's it's so expensive. The minimum ticket I found this morning for the final at the World Cup was was £5,000. Um, and that's pounds, so that's £6,000. So it's not cheap to go and watch a bit of football. And uh yeah, I mean, you look at the Aztec on Monday morning, the tickets were going for five grand pre-match. You know, it's it's not cheap this world cut.
SPEAKER_01And even in London, I mean I remember when England reached the uh the Euros finals in 2021 for the first time we'll see in a long, long time. The sh the scenes on the streets, even in London, at that point were were extraordinary. And it will be if England do make it to the finals, that will be uh pretty insane scenes.
SPEAKER_02Yeah, I mean, my kind of West London scene last night was I had a little look out the window and there were three lads in a trolley going down the high street. Um to the Simon Martin to the audio tape of a couple of foxes having a nice evening. So, like that was my kind of very West London half-full this morning as it went light and I tried to go to bed.
SPEAKER_01On which note, let's park this here. Let's park our trolley uh outside, outside Matt Hardy's house. But thank you very much. I'm sure we will be tapping up your wisdom a few more times before this tournament is through. Cheers, lads. Well, that is all we have time for today. Thank you as ever for listening to Business as Usual.
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