Profile: A lesson for the snobs: Laurence Marks on the Channel 4 boss who has proved more than just a good scheduler: Michael Grade

FOR someone who's trying to kick a three-cigars-a-day habit, Michael Grade looks surprisingly tranquil. His office is clear of its customary gauze of blue fumes. Channel 4's chief executive is leaning back in his swivel chair, necktie loosened, shocking-pink power braces

combat-ready, surrounded by blazons of occupation and affection: six television monitors; Charlton Athletic rosette; photograph of a steely babushka, grandmother Winogradski, meeting the Queen (Granny looks enchanted, the Queen is looking wary); same meeting the Queen Mother; cereal packet labelled The Big Breakfast; desk-top humidor (unopened); framed needlepoint of the word 'Collaboration'; twilit picture of his 45ft racing sloop, Laphroaig.

Grade has reason to feel pleased. His appointment in 1987 was received not with hostility (he's personally popular in the industry) but with condescension. 'A lot of people believed the caricature of Grade the Barbarian who was going to come in and privatise the channel and turn it into ITV 2 and bring in Wogan and Des O'Connor,' he says. 'It's snobbery: 'the former Daily Mirror sports writer and theatrical agent - what does he know about these things?' Some people still don't believe that that's not what I ever wanted to do, but they're getting fewer.'

The staff were dispirited by the news. His predecessor, Jeremy Isaacs, wept. ('Tears were seen,' says a Channel 4 staff member sternly at the suggestion that this might be Fleet Street mythology). Independent producers proclaimed the end of civilisation. Press response was tepid. Marmaduke Hussey, chairman of the BBC, was later to take a cheap shot at Grade's 'bourbon and red braces' style.

But in the past six-and-a-half years Grade and his management team have pushed up the channel's audience share from 7 to 11 per cent and increased advertising revenue. Yet they have not reneged on their statutory remit to offer 'alternative programming'. Last week, the Independent Television Commission, in its annual review, praised Channel 4's quality and range while sharply criticising several ITV companies for their performance.

Now, Channel 4 wants to break free of its last links with the rest of the ITV network. The ITV companies used to sell Channel 4's commercial slots and then give it a percentage of the network's total advertising take. In the late 1980s - after Grade had successfully convinced Margaret Thatcher that Channel 4 should not be privatised - the channel began to sell its own advertising. But the Government, presumably because of Treasury worries that it might flop and run out of money, invented a safety net. If revenue fell below a certain level, the ITV companies would make up the deficit. What Grade did not realise - he says he heard it for the first time on the radio when Douglas Hurd announced it in Parliament - was that Channel 4 would also lose money when its revenues went above a certain level.

So it has become a victim of its own success, giving ITV pounds 32.2m last year, probably pounds 50m this year and, Grade estimates, a total of pounds 500m by 2002. Grade says he thought the safety net was unnecessary in the first place and he would rather have had none than the present arrangement.

'That money ought to be spent on programmes. It's madness that the smallest player in the commercial television market should be subsidising its dominant competitor.'

MICHAEL GRADE, 51, had an inauspicious start in life. When he was three his mother deserted his father, the theatrical agent Leslie Grade (brother of the impresarios Lew Grade and Bernard Delfont). He has not seen her since. He was brought up by Granny Winogradski. Grade is one of the few people who lists his grandmother in his Who's Who entry. After an unhappy period at Stowe, a notably philistine public school, he was sent to a South London day school, St Dunstan's College.

He left at 17 to join the Mirror, then spent seven years as an agent in show business before switching to London Weekend Television, where he learned his trade in the 1970s as deputy controller and controller of programmes. An uncomfortable stint in Hollywood in the 1980s convinced him, as it did the film producer David Puttnam, that he lacked the appetite for churning out high-gloss formula entertainment that the West Coast movie industry requires of all but a few wayward geniuses.

In 1984 a boyhood friend, Bill Cotton (in whose family he had lived for a while), brought him back to London as programme controller at BBC Television. Confidence was low. Ratings were shaky. Some BBC journalism had become clumsily populist in a misbegotten attempt to ingratiate the corporation with supposedly tabloid taste. For the first time it was losing the respect of the middle-class opinion that alone sustains the principle of the licence fee.

Grade shone as a scheduler. He more than doubled the audience for Panorama by switching it from 8.10pm to 9.30pm on Mondays. He moved Omnibus from Sunday nights, where it was competing for viewers with The South Bank Show, to Fridays, where its audience increased. He introduced three Wogans a week to grab and hold the early evening audience, and was accoucheur to EastEnders, a morale-reviving smasheroo. He boldly reversed a nervy decision to cut money spent on filmed drama. He launched The Black and White Media Show which criticised racial stereotyping on BBC television, and appeared on the programme himself.

If there were any justice in the universe, he would have been given a crack at the deputy director- general's job, and would now be DG. But his patron, BBC chairman Stuart Young, died in office. Young's successor, Hussey, brought in John Birt, who had been Grade's subordinate at LWT and who now began to meddle with his news and current affairs programming.

Channel 4's chairman, Sir Richard Attenborough, summoned Grade to a clandestine meeting at his home. Isaacs, to everyone's regret, had decided not to accept a second term as chief executive. Grade got the job.

The unenthusiastic attitude to his appointment was a very English mixture of social and intellectual arrogance. To have been employed by a working-class newspaper and at the What Makes Sammy Run? end of show business looked . . . well, vulgar. This was all great nonsense. He is a highly intelligent man with a mind of notable clarity and an ease of manner that are very taking. He is liked for his openness, warmth and equanimity. In a notoriously stressful trade, he seldom gets rattled.

His early first marriage to Penelope Levinson (one son and one daughter) was dissolved. His second, to Sarah Lawson (of the politico-journalistic dynasty) ended three years ago. His present girlfriend is the TV director Pati Marr. He has a flat near Marble Arch, and spends holidays and summer weekends sailing, but lives and breathes television.

His salary is pounds 359,000 a year, pounds 12,000 less than Gus Macdonald gets at Scottish Television. There was a brouhaha when Grade persuaded Channel 4 to pay him a pounds 500,000 'golden handcuffs' fee not to join the recent round of ITV franchise-seekers. His friend Michael Green, boss of the shamelessly unimaginative Carlton Television (ticked off by the ITC in its annual report), has tried and failed to woo him. 'Michael's quite keen on money,' says a colleague, 'but not that keen.'

IT would be hard to withhold respect from a TV impresario who has backed GBH, Lipstick on My Collar (and Dennis Potter's magical valediction in conversation with Melvin Bragg), Four Weddings and a Funeral, The Crying Game, Oscar-winner Nick Park's animation films, Drop the Dead Donkey, the comedians Paul Merton, Ben Elton and Jo Brand, and a stream of excellent documentaries such as Beyond the Clouds (about Chinese life) and the series on Bosnia and homelessness.

The key is a cultural self-assurance that some highly creative BBC staff seem to lack. 'I'm not afraid of making mistakes,' says Grade. 'That's a very liberating feeling. Look at the BBC. Everybody there is petrified of making a mistake. You don't get good work that way. OK, I'm brash. I've never been afraid to say what I think. I don't hide behind policy units as they do at the BBC. I'll go out and sell programmes and make a noise and draw attention to my channel. I'm sorry if I'm not Lord Reith, but that's the way I am. I just wish people would look at the screen and judge me on that.'

At the Edinburgh Television Festival two summers ago he laid into the BBC, criticising the atmosphere of fear that Birt's reforms had generated. Another jeu d'esprit? 'No, no, I felt very deeply about it. I put four months' work into writing that paper. I had worked at the BBC for three years. It belongs to the nation. I couldn't sit back and let it happen without saying something. Marmaduke Hussey portrayed me as someone who favoured no change at all. But what I was saying is that the manner of the changes had been unnecessarily destructive. What makes the BBC is the talent it attracts. The climate of fear has been antipathetic to a great creative institution.'

Would he go back as Director-General? 'No, I've got over that. If I stay in broadcasting, this is where I want to be. I'm not saying I wouldn't like to be chairman of the BBC some day - which is equally unlikely.

'It will be engraved on my tombstone: 'He would have liked to have been chairman of the BBC.' I get offered business jobs. I listen. We all like to be tickled. But nobody's offered me anything as fulfilling as this.'

Channel 4's staff recently voted to outlaw smoking in the office. Grade, his liberal reflexes twitching, voted with them and relinquished his potency symbol. 'It may be that, if I don't get a cigar in the morning, the channel will fall apart,' he says. Perhaps, perhaps not. Sometimes a cigar is just a cigar.

(Photograph omitted)