TheChek News Flow

Vice Media in talks to sell stake to A&E

Vice Media is finalising the sale of a 10 per cent stake to A&E Networks, the cable television group jointly owned by Walt Disney and Hearst Corporation, in a deal valuing the digital media company at $2.5bn. The sale could be announced as early as next week an comes after Vice and Time Warner ended talks on Friday over the purchase of a stake that would have valued the group at about $2bn. A&E will pay $250m for 10 per cent, which represents a steep increase in Vice’s value. Last year it sold a 5 per cent stake to Rupert Murdoch’s 21st Century Fox for $70m, which then valued it at $1.4bn. Vice operates a global network of online channels covering news, sport, technology and music. It has offices in 36 countries, a branding agency and an unconventional style – it took the former basketball star Dennis Rodman to North Korea to meet Kim Jong Un – which it blends with more serious reports from world hotspots. It produces a news magazine show for HBO, Time Warner’s premium cable channel, and recently won plaudits for a series of hard-hitting online video reports from a journalist embedded with the Islamic State of Iraq and the Levant. The company has built a large audience of younger, so-called "millennial" viewers, which have increased the company’s appeal to older, more traditional media groups. Rupert Murdoch is among its fans and once tweeted that the company was a "wild, interesting effort to interest millennials who don’t watch or read established media". Vice will produce digital and cable programming for A&E as part of the deal but it will not currently take over any of the running of any of the company’s cable channels, which had been part of its negotiations with Time Warner, according to people briefed on the negotiations. The latest deal was negotiated between Nancy Dubuc, president of A&E Networks, and Vice. "It’s a great deal for us," said Shane Smith, Vice’s chief executive. "It means we can preserve our independence and it gives us a war chest for another three years of dramatic growth." Vice is "exploring channel possibilities" with A&E, he added, in addition to producing programming. A&E specialises in reality fare such as Duck Dynasty, Storage Wars and Epic Ink, but also produces drama series like Bates Motel. Vice started life as a Canadian punk magazine, founded by Shane Smith, its chief executive, and two friends in 1994. It expanded globally over the next decade and in the past few years led a push into online video, encouraged by Spike Jonze, the film director who is a long-time friend of Mr Smith’s, and Tom Freston, a former chief executive of Viacom – who joined the Vice board. Mr Smith once said he wanted Vice "to be the next MTV, ESPN and CNN rolled into one". Its online channels are among the most popular on YouTube, held up by the video site in presentations to advertisers as an example of how brands can connect with audiences online: YouTube recently ran a television and print campaign singling out Vice News, one of the media company’s new ventures.

Miliband considers health tax for manifesto

Ed Miliband is to put the NHS at the centre of Labour’s election campaign and is considering an earmarked "health tax" or exempting the health service from deficit reduction to prove that he can deliver a better service. Mr Miliband believes the NHS is rising up the list of voters’ concerns but wants to offer a single big policy to prove to voters that Labour will be a better custodian of its future than the Conservatives. The Labour leader is looking at excluding the NHS from Labour’s planned deficit cuts by earmarking borrowing specifically for the health service, although this may look similar to an expected promise from Tories and Lib Dems to ringfence the NHS from post-2015 cuts. Labour insiders say Mr Miliband is considering options to go further, including earmarking a specific tax to prove he is serious about boosting health funding. The opposition party, which is a few points ahead of the Tories in the polls, is looking for a way to take the political initiative and capture the public’s imagination without reinforcing its reputation for over-spending taxpayers’ money. Officials have also discussed proposing only small increases in the NHS budget in 2016 and 2017 while promising bigger investment towards the end of the parliament as the economy grows. Some of these options are certain to create tension with Ed Balls, shadow chancellor, who wants to avoid the charge that Labour would increase taxes or not tackle the deficit seriously. The fiscally conservative – but less eyecatching – option being considered by Labour would be to match Tory spending levels on the NHS while highlighting plans to scrap many of the coalition’s health reforms. Mr Balls this month denied that Labour would put a penny on national insurance to fund the NHS – an idea floated by former minister Frank Field. That proposal, backed by Jon Cruddas, head of Labour’s policy review, would echo Gordon Brown’s raising of NI by 1 per cent in 2002 to fund Labour’s last expansion of the NHS. But Mr Balls has argued that increasing taxes is not compatible with the "cost of living" agenda. Yet Britain’s ageing population is putting increasing pressure on the NHS which – according to a recent select committee report – faces a £4bn annual funding black hole as it struggles to cope with a growing number of people suffering from long-term conditions. Reconciling Mr Miliband’s desire for an eyecatching promise on the NHS and Mr Balls’s quest for fiscal credibility is expected to be the defining Labour argument ahead of this year’s conference in Manchester. Senior Labour figures expect to finalise the decision early in September ahead of Mr Miliband’s setpiece speech. Andy Burnham, shadow health secretary, has proposed merging social care with the NHS. He has claimed this would save taxpayers huge amounts of money because elderly people would no longer end up in hospital for minor incidents such as falls. But that reorganisation is not – by itself – seen by Mr Miliband as sufficiently totemic to capture the imagination of the voters. Nor may it be enough to ease the growing financial pressures on the health service. However Mr Miliband is also conscious that a pledge to boost spending on the NHS could leave Labour open to the Tory charge that it is more interested in flooding the health sector with money than seeking reforms. Labour has sought for months to divert the national political argument on to the NHS, for example by criticising the increasing use of private companies and the costly shake-up of bureaucracy early in this parliament. In opinion polls Labour tends to score much higher than the Tories on the health service – and lower on immigration, Europe and welfare. Mr Miliband has frequently raised questions over waiting lists at the weekly prime minister’s questions in the Commons. But these have usually failed to cut through into the public arena, instead descending into a fog of selective claim and counter-claim between Tories and Labour.