Maximising public value in the "now" media world. By Andy Duncan, Chief executive, Channel 4

Andy Duncan was appointed as Channel 4's fifth chief executive in July 2004. Prior to joining Channel 4, Andy spent three years on the executive board at the BBC, as director of marketing, communications and audiences. During this time he was a key architect of Freeview and, after leading its launch, was chairman for its first two years.
Andy joined the BBC from Unilever, where he worked for nearly 17 years.

Good evening everyone. Three hundred and fifty-seven years ago, not far from here, Charles I was executed and the death of the monarchy proclaimed. Five years ago from this platform my predecessor-but-one, Michael Jackson, announced the death of public service broadcasting. Both, as it turned out, proved to be a little premature.

In fact, as his argument unfolded, it transpired that Michael's message wasn't quite that stark but he certainly believed many of the traditional forms and values of our broadcasting system were not only unlikely to survive the rigours of the first decade of the 21st century, they also didn't deserve to.

Five years further into the digital revolution, I want to put to you a rather different proposition. Far from being on its last legs, public service television is the sturdiest bridge we have from the old analogue world of the mass viewing experience to the rapidly emerging future of consumer-led, made-to-measure media and the opportunities of a digitally-connected society. Public broadcasters will help us get there. By then, though, they'll be in much more than the business of broadcasting.

What happens after that is anyone's guess, but will depend, in part, on a shared understanding of the possibilities of this new world and on making the policies to deliver them. We could have a media system that is vibrant and worthwhile or we could end up with something that serves only selfish wants and commercial or institutional purposes. Chief executives of global media giants have a favourite mantra about extracting value from the explosion of new media platforms and technologies. They're not talking about public value, that's for sure.

The transitional period we're in now, between the comfortable certainties of the analogue era and the apparently limitless possibilities of a digital future, can look chaotic, anarchic, even frightening. However, we're not facing a technological fait accompli over which we have absolutely no control. As broadcasters and policy-makers, we don't surrender our ability or abandon our duty to make choices about the post-digital media environment we want, just because it's now possible to search the internet for clips from four million videos or blog the intimacies of our daily lives to a fascinated world.

It is our call as to whether we still want to extract public, as well as commercial, value from our media system and, if so, how we might achieve this in a nation more globally integrated, yet more socially fragmented, than the Britain John Reith - or even John Major - presided over.

So I'd like to use this lecture to explore the role and potential of a public corporation like Channel 4 in a world where broadcasting is just one means of content distribution among many; where those quaint old things we call "programmes" occupy just one shelf in a massive cash-and-carry content warehouse. How will our traditional brief of serving up education and information alongside entertainment fit into a market where power lies with the consumer and the content creator, not the packager? Can public broadcasters be as influential and productive for wider society after digital switchover as they have been until now?

The short-term answer must be "yes", because the UK is already committed to investing heavily in the BBC for the next ten years (though perhaps not as heavily as it would like). But public value is about more than what the BBC does with public money. It will take more than a single organisation - even one as powerful and ubiquitous as the BBC - to deliver it. If we think we've fixed the future just by renewing the licence fee until 2016, we're mistaken. Vital as it is, the BBC is only part of the picture.

I believe that there is an exciting longer-term role for public service broadcasters to reinvent themselves as major conduits for creativity and communication in the post-digital world. Channel 4 is already carving out a distinctive role and can be a key player in sustaining our wider creative economy. But I will say more about that later.

Unlocking this potential depends on a very 20th century key. I will argue that the high current net value of our broadcasting system - in cultural, creative and economic terms - owes everything to enlightened public intervention and that television's potential to generate wealth, and contribute to the common wealth in future, depends on it.

But first, let's look at what's happening now and why the broadcasters' position in the media landscape is shifting. It's not a straightforward picture to read. Change is happening fast. Every broadsheet media supplement heralds a new killer application that will change everything forever, starting tomorrow. Sorting the significant from the hype is hard because often it's just too early to tell.

Personal video recorders (PVRs) were supposed to have destroyed broadcast television and the airtime sales business by now. They haven't yet, though it's certainly true that the advertiser-funded model is under strain.

Internet use is supposed to be galloping ahead of TV viewing. It isn't, except for a particular group of young people who were always light TV viewers anyway. TV companies and dot.coms aren't just in competition for eyeballs, they're competing for advertising share too; so there's a lot of spin about.

For all the hype about the latest broadband and mobile gadgetry, many of the fastest-selling consumer electronics devices are actually all to do with traditional TV - Freeview boxes, and widescreen LCD and HD sets.

Finding truth in a confused and rapidly changing market populated by powerful vested interests is a tricky business. While new phenomena such as the "social networking interface" MySpace have impressive hit rates, it's worth remembering the continuing power of traditional TV to deliver big audiences.

Eight million people tuned in for the opening night of the latest series of Big Brother and nightly audiences are regularly peaking at over five million. Add to this the fact that channel4.com is establishing itself as a powerful online brand in its own right, achieving higher UK reach in the past month than many of the most talked-about online brands, including MySpace and YouTube, and I believe we are uniquely well placed as a significant player in both the linear and online worlds.

By the way, if you haven't caught up with MySpace yet, don't worry because, since being taken over by Rupert Murdoch's News Corp, it's already facing fierce competition for teenagers' affections from something called Bebo. Is this another new BBC service they managed to slip past Michael Grade without a public value or a market impact test? Actually, no. It's run by a husband and wife team in San Francisco but, by the time I tell you this, they've probably already been replaced by the next new thing.

So everything is shifting all the time. But the main trends are clear enough. Broadcast television is no longer the funnel through which entertainment and information are channelled to millions of waiting consumers in a one-way flow. The ever-expanding choice of reception platform - TV, mobile, internet, MP3 player - and the potential for everyone to create and distribute their own content, however humble, are ineluctably eating away at the broadcaster's traditional role as overseer in the great treasure house of content.

Though change appears to be happening at breakneck speed, this is actually a slow-fuse revolution. The internet has been in widespread use for at least a decade. Most broadcasters launched websites back in the last millennium. We're still talking about "new" media as if they turned up yesterday, when really we should think of them as "now" media. They're not only here, established and evolving; they're also immediate and accessible to users in ways that older media are not.

At the same time, broadcasting remains powerful because it is still well-resourced enough to produce and distribute premium content, the kind that everyone wants to see at some point. Terrestrial broadcasters still have privileged access to the most ubiquitous distribution system in the world and we have a couple of killer applications of our own: we're available everywhere and for free. Even that notoriously hard-to-please group, the 16-34s, still flock to "event television": The X Factor, Big Brother and the World Cup. For all the excitement and promise of "now" media, broadcast television will remain the default option for most people for some years to come. But people's relationship with television is changing, and the younger the people, the bigger the change.

People under 25 now expect to find entertainment and information in a variety of different places, instantly accessible and tailored to their needs - even on their mobile phones. This amazes older people brought up with the big screen; they look incredulously at their mobiles, wondering how anyone could watch telly on that. But we've been wrong before: "TV will never be a serious competitor to radio because people must sit and keep their eyes glued on a screen. The average American family doesn't have time for it". That was in The New York Times in 1939.

There's another big change working its way through the generations. Today's thirtysomethings are probably the last to share a common TV heritage. A collective memory of programmes that had impact, special meaning or resonance for them and millions of other people.

It remains to be seen whether Friends Reunited, Popbitch and their successors will hold the same potent memories for future generations as Brideshead or Big Brother.

Is this regretful vanity on the part of TV executives, who like to think their efforts might endure in public memory? Or is there still currency in the notion that TV brings very different people together, forming and reinforcing common values and ideas of the society that they are part of? I think there is - and not just for the duration of the World Cup. But there will be many more varieties of shared experience in future.

Already, users of "now" media have a collective experience of a different kind. Television wraps millions of individuals, thousands of disparate groups, together in a cover-all common experience. Mobile and online technologies connect people within those disparate groups, uniting them by common interest or specific purpose - to buy a handbag on eBay, recruit a flashmob, or pick out their favourite bit from Desperate Housewives. You choose who you connect with, search for exactly what you want, see pretty much what you want to see. You're in control. You don't have to accept an experience someone else has made, when and how they decide to give it to you.

All this looks like bad news for broadcasters, the most staid and static of the old-style content packagers, with their straightjacket schedules and a big old box in the corner. It makes broadcast TV, and carefully mediated, subsidised and scheduled public service television in particular, look strictly 20th century.

No wonder in his 2001 lecture, Michael Jackson called it: "a paternalistic exercise in adult education by the wing-collared classes...a redundant piece of voodoo".

He was right of course. The old Reithian ideal of giving people what's good for them, whether they want it or not, is not only pointless but impossible when there are so many other alternatives. Mass education, economic affluence, global media have all made paternalism untenable. The exploding media market provides quality, innovation, endless choice; not necessarily in equal measure, but they're all on offer somewhere.

The carefully controlled media diet, high on protein and roughage, low on carbs, as prescribed by the nutritional experts, has been off the menu for some time now, and probably rightly, but this doesn't mean there is no longer a role for broadcasters with a public brief, like Channel 4. And it doesn't mean that the uniquely British way our broadcasting system has evolved - through enlightened public intervention and putting purposes before profits - is no longer appropriate in planning for the future.

However old-fashioned it may seem to us now, public service broadcasting was a 20th century triumph of market intervention that evolved into a world-class communications model and a vibrant creative economy. These are still producing social, cultural and economic benefits today. Britain spends more per capita on broadcasting than any other country.

As a result, it is a major plank of our vibrant creative industries that employ nearly two million people and contribute more to our balance of trade than the pharmaceutical sector. Public service broadcasters channel talent and profits into the creation of small works of art that entertain and enlighten millions. Their news services are the most authoritative and trusted in the world.

As a robust instrument of citizenship; as a subtle disseminator of values; and as the main source of information about the world for millions of people, I believe our broadcasting system is unrivalled.

All the turning points in the evolution of that system are marked by the intervention of public policy: when the BBC was elevated, via Royal Charter, from coalition of radio manufacturers to voice of the nation; when ITV was configured as a non-competitive regional federation with public obligations as well as commercial imperatives; when Willie Whitelaw - contrary to every expectation of a Thatcher government and to the bemusement of his Cabinet colleagues - shaped and enabled not ITV2 but an entirely new, oppositional and troublesome outfit called Channel 4. This also, of course, kick-started the UK independent production sector.

None of this happened by chance, or as a function of the market, though market forces undoubtedly played their part. They were the result of deliberate, thoughtful and, as it turned out, far-sighted intervention by politicians and policy-makers from across the political spectrum, who shared a belief in the need for broadcasting to serve not just our interests as consumers but also as citizens.

Intervention in broadcasting may have its roots in paternalism but it has produced, I believe, outcomes of lasting significance and value: plurality in impartial news, a tradition of muscular drama and investigative journalism, a training ground, outlet and platform for some of Britain's most creative talents.

As the last great state intervention in the UK media market, the publicly-owned Channel 4 added essential new qualities for changing times: a challenge to authority and orthodoxy; a concern for diversity and difference; youthful cheek.

The need for all these outcomes and qualities does not diminish with digital media. Ongoing intervention is still necessary to ensure that they stay a feature of our media landscape because we know that the market - though it provides much - doesn't deliver everything we believe we need. The old values are joined now by new imperatives. Viewers may be in control but they may also welcome help in navigating a bewilderingly complex multi-media world, sorting the significant from the merely fascinating among the Babel of messages, and understanding the possibilities as well as the contradictions of life in a fractured society.

These are all things a purely commercial media market is not good at providing. This is our challenge and our opportunity as public broadcasters.

Digitisation and the shift from broadcast to broadband technologies has been compared to the advent of the printing press because it liberates knowledge and information from the control of the priesthood and its scribes - broadcasters and their producers if you like. It allows access to everyone via simple hardware and software. The analogy is acute. Digitisation is an inherently democratising movement with huge potential for innovation, education and creativity - all essential requirements for a successful society.

Where once only the rich and the worthy were granted access to the means of creating and distributing content, now virtually anyone can do it. This opens up not just a thousand potential new business models, but millions of ways for people to communicate and share material with each other, many of them delivering their own small packets of social and public value. Bloggers in Iraq, students in Syracuse, voluntary, political and community groups, and yes, the New Statesman (hello, by the way, to those of you listening to this as a podcast); all these people now have a platform from which they can address a global broadband audience and hear back from them.

There's an education and facilitating role that we can play here in helping people to use this access to greatest effect. Not a takeover; we of all people respect grassroots movements and the individual dissenting voice. I'm talking about the public broadcaster as educational resource, rallying point, multiplier and enhancer of small-scale communications. We're now making this a central part of our education work, and I want to describe how in a minute.

I don't see the digital revolution as an attack on Channel 4's power as a public broadcaster. I see it as a fantastic opportunity to build on what Channel 4 has always done: stimulate, infuriate, debate, create. The difference is that we're doing it in many more ways than just via broadcast these days, because we have to engage with the public wherever they are.

If "public service broadcasting" is to mean anything at all, it ought, surely, to have a bright future at a time when people no longer just consume broadcasting. People are beginning to make it, shape it, choose it and vote on it.

In a commercial media landscape polarised between global "premium product" - Hollywood films and international sport - at the commercial end and small-group conversations at the user-generated, not-for-profit end, a fertile middle ground beckons public broadcasters. This is where they can supply UK-produced quality information and entertainment for a UK audience, free-to-air and on a variety of platforms. They can open up opportunities for people to engage with, learn from and contribute to all the new media services that are now on offer.

Mark Thompson, in his recent Fleming Lecture, "Creative Future", set out the BBC's plan for a comprehensive occupation of this middle ground. In many respects this is exactly what our principal public service provider should be doing. But the BBC isn't - and shouldn't be - a monopoly supplier. In many of those areas, Channel 4's already leading the way. Much of the BBC's creative future is already Channel 4's present. If the BBC positions itself as the Harrods of the media world (the Harrods motto being: omnia omnibus ubique), providing everything for everyone, everywhere will simply replicate services at huge public cost for the sake of occupying the territory, when surely its real job is to add value and distinctiveness.

Mid-20th century imperialism is out of fashion and out of order. No one would claim to be the best at everything and resources - public or commercial - are finite. The BBC must, of course, be adequately funded, but it shouldn't be overfunded. It's important that we concentrate on contributing what we're each good at.

So this is where I think Channel 4 adds value where no-one else can. We're particularly good at stand-out programmes and content with a purpose and perspective that challenges the competition and audiences.

We're planning to do precisely that in a very "now" medium - radio.

For too long there's been a yawning gap between the BBC's supremacy in the world of the spoken word and the commercial operators' limited range of formats. Digital radio makes room for us to come into that middle ground with something different: intelligent speech and music content with attitude and younger appeal that will, for the first time, involve listeners in the creation of a station.

Our modest aim is to redefine commercial radio, bringing in independent producers with fresh ideas, new advertisers to boost the flagging commercial sector, and real public service competition to the BBC where it counts - on quality and original content. Despite its undoubted quality, the BBC's dominant 56 per cent share of listening isn't healthy.

This month we launched channel4radio.com, the beginnings of a virtual station on the web. It offers news, current affairs, original comedy and entertainment, as well as spin-offs from Channel 4 shows like Richard & Judy, Lost and Big Brother. Our next step is to lead a consortium to bid for the second national DAB multiplex licence when Ofcom advertises it at the end of this year. This offers the capacity for up to eight new national stations, and the space to develop new data services too.

Why should a television company want to move into radio? Because digital convergence is now a reality. People are listening to radio on their TV sets; watching TV on their mobiles; getting their news on-line. We no longer work in media silos. We're not just in the television business any more; we're in the communications business.

That means our public purpose can no longer be constrained to programmes on a single television service. In order to deliver our remit and remain relevant, we have to be everywhere that our audiences want to consume our programmes, offering public service plurality on every channel and platform - a vision and a strategy endorsed by Ofcom in its review of public service television broadcasting and by government in the BBC white paper. We're serious about public service competition, and ambitious to bring the Channel 4 difference to radio, as we've already brought it to our multi-channel, online, mobile and video-on-demand services. That Channel 4 difference is part of our reason for being.

Despite all the talk about the supremacy of content in a world of limitless choice, quality and originality are still scarce because they are expensive, time-consuming and risky to produce. Original UK television drama can cost a million pounds an hour to make. Similarly, Niall Ferguson's The War of the World: a New History of the 20th Century, our ambitious factual series, which is currently airing, cost over a million pounds.

Left to its own devices, the commercial market will avoid investing these sums unless there's a cast-iron prospect of profit. It prefers cheap, risk-free solutions: cannibalising back catalogues and exploiting consumer-generated material with the widest global appeal at the lowest cost. This gives us The All-Time Best Bits from the Matrix Movies and You've Been Framed without the production values, and teenage blogs about snogs. However, it doesn't guarantee we'll carry on getting risky, expensive and high quality dramas like The West Wing and The Sopranos. They'll only continue to be produced if they make money.

The same applies, only more so, to UK origination because our market is so much smaller than the US. The BBC has a deserved reputation for quality and takes some well-judged creative risks but usually within clearly defined and rather conservative limits.

Despite evidence of real innovation emerging at the user-generated end of the content spectrum, the explosion of channels and platforms hasn't been matched by an expansion of high-quality original material, and perhaps we shouldn't have expected it to. Pay-TV, telecoms and online players have invested small fortunes in high-tech distribution systems and that's where their knowledge base is. They're not in the business of investing in high-risk original content. As they see it, it's not their job to pioneer new content forms, encourage independent thinking or promote quality product but it is our job at Channel 4.

Dramas with a potent political or social message like The Government Inspector, The Road to Guantanamo, A Very Social Secretary and Shameless; factual pieces like The Torture Season, Iraq: the Bloody Circus, or Anatomy for Beginners; inspirational lifestyle formats like Grand Designs that go much deeper than mere makeover shows. All these and hundreds more wouldn't be made if Channel 4 didn't exist.

That is what we do: high-risk projects that challenge current orthodoxies and offer new insights. Jamie's School Dinners, Green Wing, Wife Swap, Unreported World are all originals. Others - including the BBC - may follow, but so often we've paved the way. We also offer a different perspective and real competition to the BBC on news.

Channel 4 News - arguably our most important brand - isn't just the best news programme on television, it's also available to view on your laptop as a webcast, and you can get Jon Snow's specially tailored version on your phone via our mobile portal. Our news and current affairs online service now provides the global perspective and wider context missing from other news agendas.

More4 News has extended our news reach to younger audiences and makes us the only public broadcaster to be increasing news provision. BBC3, disappointingly, abandoned theirs. The £25m we now spend a year on news is more than money well spent. It's an investment in democracy.

If that sounds pompous, I don't mean it to be. But the point is too important to underplay: we must retain plural sources of high quality national and international news, available across a variety of platforms. As No 10 complained recently, there seem to be too many 24-hour news outlets looking to keep stories going to fill the time. But as Sky and ITV News both come under increasing commercial pressure, the real choice looks to narrow, not expand. Channel 4 and More4 News, with their international perspective, in-depth reports, regular scoops, and journalists of the calibre of Lindsay Hilsum - now our first China correspondent - are easy to take for granted.

In a world of giant media corporations, Channel 4's genuine independence is an increasingly valuable asset, especially when it comes to news and current affairs. We should cherish it.

There's another vital area where I believe we can make the Channel 4 difference count and that is in social inclusion.

One of the potential disasters, as well as the delights, of the exponential growth in peer-to-peer networks enabled by broadband is that they are self-defining, self-selecting and self-governing. Though this may be emancipating for the individual, there is a social cost. Like-minded people can join together wherever, whenever, to share information, products and prejudices and never have to step outside their own insular value system or consider other possibilities.

This trend began with the growth of multi-channel television. Those who felt ill-served by mainstream media flocked to new specialist services based on ethnic, religious or cultural ties. This fragmentation of services and audiences is one of the downsides of digitisation. It's not their job to make connections with different experiences, alternative points of view, or other people's lives but it is our job at Channel 4.

Since the beginning, Channel 4 has made a point of revealing, exploring and celebrating difference. Once narrowly characterised as "catering for minorities", diversity is now absolutely integral to our output and one of our most distinctive points of difference from other services. We no longer commission for "minorities" because we want to bring audiences together, not segment them. Location, Location, Location should appeal as much to the black viewer as to anyone else.

But, from the start, we've led rather than followed public opinion.

What seems like a century ago in the history of attitudes to homosexuality, Channel 4 launched - to howls of manufactured outrage in the Daily Mail - a modest magazine show called Out on Tuesday. It was the first in a rich seam of programming that led to more ambitious and influential projects like Queer as Folk. These gave other broadcasters permission to follow and brought homosexuality into the mainstream. Now every soap has its gay storyline and no makeover show is complete without its same-sex couple.

We're just as interested in pushing boundaries on race, disability, religious belief, British class and culture (what else is Wife Swap?). We've shown young autistic people trying to explain why they find it so difficult living with others, young Muslim women discussing the constraints and benefits of Sharia law, and Grayson Perry explaining Why Men Wear Frocks. Who else would do all this?

Whether the subjects live in Telford or Tehran, we realise, through seeing them, that we have more in common with others than we might have thought. What at first sight may look perverse, inexplicable or tragic, on further examination can be seen more clearly as another aspect of being human.

That mission to explore difference and commonality has assumed even greater significance since the events of 7 July last year. I believe it is one of the most important things we do.

But why should people choose us, when there's so much else out there to claim attention? Unlike other media organisations, I think we have the unique benefit - marketeers would call it a brand value - of appearing open, non-judgemental, non-institutional, independent-minded. "Trouble-making but in a good way", as a respondent in recent research reported. We represent everybody and nobody. We're not weighed down with cultural and institutional baggage like the BBC; we're younger and cooler than ITV and we're not part of any global media conglomerate. We are ourselves. Our unique public-private status - with neither shareholders nor governments to please - gives us precious freedom to go where others can't or won't.

That makes us an attractive companion and trusted guide in a confusing world. And people's hunger for compelling human narratives, with lessons they can carry into their own lives, shouldn't, I think, be underestimated. The demand for good stories and engaging storytellers never goes away.

Perhaps the most exciting area, with huge potential for making a difference in the "now" media world, is in the heartland of the old public service brief: education.

This is where the explosion of interactivity, the convergence of platforms, the merging of the internet's resources with television's power, has perhaps the greatest potential of all. I'm proud that we still support the school curriculum but the action now takes place beyond the classroom and certainly means more than just watching schools' TV. And our traditionally broad view of what used to be called "adult education" (shades of those wing-collared classes again) now embraces everything from Grand Designs and Jamie's School Dinners to Gordon Ramsay's F Word and OrigiNation - which maps the cultural contours of Britain online, from the histories of thousands of immigrant families uploaded to channel4.com.

Just as the Open University transformed attitudes and access to higher education in the 1960s, we're opening up new learning opportunities and entry points into the creative industries for people in the on-demand world. This is not just through television but through websites that develop practical and intellectual skills, and off-air activities that stretch the educational value of on-screen material.

Jamie Oliver isn't just an on-screen brand and one-man policy-busting dynamo. With Channel 4's support he is also an educational foundation, a chain of training restaurants, conferences that bring opinion-formers together with young people and resource packs for schools on how to make their dinners more nutritious. We helped make all this happen and it started with television.

It is at this point where the old and new worlds meet, the cusp between broadcasting and "now" media, that our education role has real point and potential.

Digital connectivity will allow everyone to be a content creator and distributor in future but much of what is created won't merit distribution beyond someone's back bedroom. Providing the means doesn't automatically unleash creativity. You can see some pretty dismal examples on the video blog-sharing site, YouTube, which is all the rage at the moment.

Simon Duffy, chief executive of NTL, told the Royal Television Society recently that "citizen journalists" armed with digital cameras and blogs would transform traditional newsgathering and do away with the need for professional journalism. But hacks and scribblers everywhere can rest easy because I don't think it's quite that simple.

People need skills in using online, audio and visual media to transform their back-room experiments into content with real impact, whether it's documentary, comedy or newsgathering. We can provide the tools, the skills and the inspiration and, in the process, bring the best of user-generated content back to broadcasting by giving it a wider audience.

This is an example of "making bridges", the brokering role that I mentioned earlier and said I would come back to, and the facilitation and education role we can play in helping people make the most of access to "now" media.

Last year we launched an experimental broadband documentary channel, 4Docs. This uses our traditional strength in factual programming and our rich archive as a resource for aspiring documentarists. You can access clips and tips from professionals but also upload your own four-minute masterpiece for everyone else to use and learn from. It's an online resource, exchange and showcase for everyone interested in producing factual material - whether amateur or professional - and it's completely free.

4Laughs, which is due to launch next month, works on exactly the same principle for comedy.

The material produced gets the chance of exposure on bigger platforms. Slots on the core channel like 3 Minute Wonder after Channel 4 News, and Comedy Lab are part of our regular commitment to giving space to untried programme makers. Channel 4 has always done this, and now with More4, E4, the broadband channels and radio, there's even more opportunity to bring new and experimental work to a wider audience.

Giving young people a taste of how professional programmes are put together is also part of what we're doing in education.

Last autumn, students from nine London schools and colleges came into the Channel 4 News studios at ITN to research, edit and present their own bulletin from scratch. This was part of Breaking the News, an online resource for media students that is also available to anyone who wants to find out how news programmes come together. You can see exactly how they did it, find out who's who in a newsroom, and get master classes from reporters, editors and presenters - all on the Breaking the News website.

All this work recognises and adds real value to participation in user-generated content in a way that other media players have yet to fully grapple with. I think we feel so comfortable working in this area because Channel 4 has always had access points for new work and unheard voices, and is always looking for new ways to inform and educate. Enabling and connecting with user-generated content feels a natural extension of that part of our remit.

Everything we do with young people to encourage participation and talent is worthwhile in itself, contributing to a more engaged, confident and media literate public. But it also feeds into a greater enterprise and one critical to Britain's cultural and economic future: our creative economy.

Successive enlightened public interventions in broadcasting have gifted Britain a strong starting position in the global creative economy. Channel 4 itself kick-started the independent production sector that today attracts UK commissions worth over a billion pounds a year (according to the Ofcom Production Sector Review, January 2006 ), and seeds British-originated formats across the world. Channel 4 commissions have stocked the portfolios of today's super-indies, enabling them to build market value and international businesses.

Commissioning for us has always been much more than picking winners; we work in partnership with producers and it's the collaborative process that often results in output of distinction. We remain the key outlet for independent producers in Britain, substantially funding their work and, in many cases, fully funding it. And we add value to it in the commissioning process. We work with a whole range of producers and it's a unique symbiotic relationship that has benefited UK consumers, producers, Channel 4 and the UK economy.

But we need to work harder and sharper to compete with both the primarily US-based global players and the emerging creative economies of China and India.

So we're investing a lot of effort in developing new talent. Not just through our broadband resources like 4Docs and 4Laughs but via the forty or so initiatives we're currently running under the 4Talent umbrella. Through these, we support emerging talents in every media discipline from animation and acting to gaming and graphics. This is in addition to schemes like Ideas Factory, which helps young creatives find their first commissions, and Youth Culture TV, which gives raw talent the motivation and information to succeed in the creative industries.

Tomorrow, a new play opens in the West End. It's by a woman with no previous professional stage-writing experience. It's the winning entry of 2000 plays submitted for our series The Play's The Thing, which does for theatre what Operatunity and Musicality did so successfully for opera and musicals. Two thousand entrants is almost double the number who went in for the first series of Pop Idol. If more people want to be playwrights than pop stars, then we're delighted to help by showing how it can be done.

One of Channel 4's most significant cultural contributions is Film Four. Since 1982, we've enabled the work of Stephen Frears, Ken Loach, Mike Leigh, Danny Boyle, Michael Winterbottom and dozens of distinguished film makers to reach a wide audience. We were the first broadcaster to invest in British film, encouraging the BBC to follow.

I don't think that anyone would argue with the claim that Channel 4 has been one of the central creative forces of British and world cinema in the last 25 years. You all know the list - it includes My Beautiful Launderette, Trainspotting, The Madness of King George, East is East, Touching the Void - and it's still going strong, with Oscars won last year for Motorcycle Diaries and Wasp and one this year for Six Shooter.

Now this wonderful body of work will get an even wider audience when FilmFour goes free-to-air next month, making a brilliant catalogue of the best of British, US and foreign cinema available to over 70 per cent of UK homes. Later this year we're planning to complement this with a video-on-demand service - another outlet for our £10m-plus annual investment in UK film.

Tessa Jowell has spoken of the BBC licence fee as "venture capital for the whole nation's creativity". We don't have the benefit of the licence fee, but our contribution - more distinctive, differently-targeted and with a sharper edge - is just as vital to individual creative endeavour and to Britain's creative economy.

Indeed, with a turnover of just under £1bn per annum, generated by just under 1,000 staff, at no direct cost to the taxpayer, I would suggest that, pound for pound, Channel 4 is the most cost-effective and productive public institution in the UK today.

Channel 4's recent commercial success has focused attention on cash value rather than public virtue. This is not only a pity, but a fatal distraction. Policy interventions created two great public broadcasting corporations. Channel 4 is just as much a public asset as the BBC. Our "profits" go not to shareholders but into content, talent and ultimately into Britain's creative economy.

Of course we must generate revenue through audience-winning imports and long-running strands to fund the project but my aim, as chief executive, has always been to ensure that our overall priorities stay public. That's why I ended the merger discussions with Five. And why I believe Channel 4's potential can only be fully realised by remaining a public corporation.

You only have to look at what's happening in ITV to see why. The old deal, in which commercial broadcasters delivered public benefits in exchange for a time-limited, all-but-monopoly licence, has broken down. Now the carrot of near-monopoly conditions and the stick of heavy regulation have both gone, ITV increasingly looks to Ofcom for relief from its obligations as competition bites.

Private companies will produce public goods, but only if they are consistent with profit. ITV still invests heavily in quality UK production but the gradual withdrawal from areas of avoidable financial risk started some time ago. Real genre diversity in peak time - a defining characteristic of the Channel 4 schedule - is no longer a viable option for ITV. And their multi-channel and new-media strategy focuses on revenue-generating potential rather than public service possibilities. This isn't a criticism. It's what shareholder-driven companies must do in competitive times.

We're different: different by constitution, by remit, and by ambition. So we're going in the opposite direction, pushing our public brief into new areas and platforms even though the legislation and our licence only requires this of the core channel.

Now and tomorrow, we are the only meaningful competitor to the BBC in vital areas like education, innovation and distinctive quality. Our presence, our programmes, our plans for the future, all help keep the BBC up to the mark. The BBC is already plotting its challenge to our possible entry into radio. That's exactly how creative competition should work. As my predecessor-but-two, Michael Grade so memorably put it, "Channel 4 keeps the BBC honest".

Ten years later, he's still trying to keep the BBC honest.

But it is perhaps the differences between the two corporations that speak most eloquently of their respective public value.

The BBC, with its funding secure and its digital mission endorsed, is about to enter a new licence period of confident expansion. It is a vast and priceless public asset for which we are prepared to invest billions of pounds of public money. It represents solidity, continuity and authority in an increasingly complex and uncertain world. An ocean-going liner that will keep us all together in some comfort, afloat in a sea of change.

Channel 4, a smaller, lighter and more agile craft, will do something different but just as important. It will have the nerve to navigate uncharted waters and discover new shores. It will offer alternatives on news, on politics and matters of faith, about how we fit into the world, and how we live our lives. It will remind us of our individuality as well as our common humanity. It will go on taking risks when every other mainstream media business is going in the opposite direction. It will encourage us to question received wisdom and provide the educational tools to engage with change, not just survive it.

There's much more to do as we move into this exciting, risky technological and intellectual renaissance. This isn't just a matter of opportunity. I believe it is a social and democratic necessity for Channel 4 to play its full part in the future. This won't happen if we leave it to the market.

The roadmap that will guide us to a diverse, plural media economy in which creativity and public goods are valued at least as much as successful business models, is well under way. Key milestones are now in place. Following Ofcom's review of public service television broadcasting and the BBC white paper, the charter and licence fee are secure until 2016. Ofcom will complete its review of Channel 4's financial position and future prospects in 2007. The following year, digital switchover begins.

Securing public value in the post-digital media economy depends on three things: a strong BBC, successful switchover, and plurality in public service provision. We're now in the final stages of settling the licence fee; the worry is not whether the BBC will be strong enough, but how dominant it will be. Switchover is a major undertaking with many challenges ahead; but it is being meticulously planned. It is the third leg of this three-legged stool - public service plurality - that isn't yet in place.

Channel 4's run of commercial and creative success has obscured its fundamental vulnerability. We'll always aim for creative excellence, but we can't outface the twin challenges of pressure on advertising revenue and ever-increasing competition forever.

The government and Ofcom have already recognised the pressures on terrestrial broadcasters. The BBC's licence fee settlement will take into account the challenges and costs it faces as a result of switchover. The payments ITV and Five make for their licences have been significantly reduced - and ITV's public service requirements have been cut. Channel 4 is the only terrestrial broadcaster to have received no support - yet.

In the BBC white paper, the government committed to consider sensible forms of indirect support for Channel 4, specifically assistance from the BBC to help us convert our analogue transmission network to digital and the allocation of a limited amount of spare digital terrestrial television capacity from the BBC. These are the essential first steps to securing Channel 4's long-term contribution and it is vital that they are confirmed as the marathon process of BBC Charter renewal comes to its conclusion. They are the bare minimum necessary to give us the degree of certainty we need to plan for switchover as our key historic subsidy - free analogue spectrum - rapidly disappears.

But, as crucial as these measures are, they are only first steps. Ofcom has already proved itself an imaginative and far-sighted regulator and in its forthcoming review of Channel 4's finances. It has a historic opportunity to identify and propose the longer-term solutions that I believe will be necessary to secure Channel 4's future as a public corporation and the key public service competitor to the BBC.

Beyond this imminent review, if we want a genuine plurality of public service provision beyond switchover, and not just limited competition between the BBC and Channel 4, it will be essential for both Ofcom and parliament to engage seriously with the review of public funding for broadcasters other than the BBC that the government has committed to complete before the end of switchover.

As Donald Rumsfeld said, there are known knowns. We know digital switchover will happen. We know there will be a strong BBC to carry us through it. We also know that a strong BBC is necessary, but not sufficient, for a healthy media with a good range of well-funded, high quality public services.

The big unknown is how entirely commercially-supported alternatives to the BBC can be made viable until the completion of switchover, much less beyond it. There's only one way to remove that uncertainty, and that is to take steps to safeguard the future of Channel 4 now.

We have two public corporations in British media, the products of inspired intervention. Both of them world class. Both are pioneering new forms of public value, each in different ways.

Britain is lucky to have them both. More importantly, Britain needs them both.

Thank you.

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