By Peter John Meiklem, Media Correspondent

THE Edinburgh International Television Festival being held next weekend features a special edition of Noel Edmonds's Sky gameshow Are You Smarter Than A 10-Year-Old. In classic Edinburgh-ironic style, Edmonds himself is being inveigled into hosting a spoof version, asking: Are You Smarter Than A TV Executive?

TV critics, both armchair and professional, may already have their own answer to that, nurtured during the successive three hours 38 minutes a day the average British viewer is parked in front of the box (according to new Ofcom statistics).

However smart they may or may not be, the execs know that the industry is facing critical times. The viewer's average age is rising and many young people are tuning out. The industry is in the credibility doghouse after a wave of phone-in scandals, and advertising revenues are predicted to go through the floor in the second half of 2008.

Andrew Mackenzie, this year's festival chair, thinks the 2000 delegates heading for Edinburgh next weekend have "got what it takes" to sort out the industry's problems. But have they? We preview the issues that television's great and the good will be wrestling with next weekend.

ITV
IT SEEMS almost cruel to rehearse the misfortunes of beleaguered commercial broadcaster ITV, but as its director of television Peter Fincham is giving this year's McTaggart lecture - the most influential UK media speech of the year - ideas on reviving the company's fortunes should be batted around next weekend.

The depths to which ITV has plunged were underlined earlier this month when chairman Michael Grade announced that broadcasting profits fell by 21% to £89 million in the first six months of this year. Adding insult to injury, Grade - appointed in November 2006 as a would-be saviour - was forced to downgrade his previous "turnaround" targets for the business.

The former BBC chairman tried to distract attention with a fierce attack on the Ofcom regulations that govern the broadcaster, threatening to hand back its public service licence if he didn't get his way.

However, many of those heading for Edinburgh next week dismissed his stance as "bluster" and said the heart of Grade's problems was not regulations, or even the advertising downturn, but the lack of attractive programming.

Richard Woolfe, controller of digital channels Sky One, Two and Three, said Sky had stolen ITV's thunder.

"One of the greatest compliments we were paid was saying all the shows that should be on ITV - Are You Smarter ...?, Gladiators, our new dating show with Cilla, Noel Edmonds - are on Sky One. We have taken up the big, noisy entertainment baton."

Woolfe said ITV had lost its way: "I look at ITV as a viewer and as a competitor and I think to myself it is a network that doesn't quite know what it wants to do.

"Where there are so many places fighting for people's attention, we need to take risks and we have to be creative. If ITV is going to win viewers back it needs more surprises."

TRUST
WHEN Fincham was announced as this year's McTaggart speaker, media watchers rubbed their hands together with glee: at last the inside story on Queengate, a reference to the misleading BBC preview - implying Her Majesty had stormed out of a photo-shoot - that led to both Fincham's resignation as controller of BBC One and an ITV and BBC ban on the use of production company RDF media.

But then Fincham got a job - the director of television at ITV, to be precise - and hopes for a juicy, bloody, gossip-nourishing speech died. While Fincham may be muzzled slightly by his new appointment, the legacy of Queengate lives on Don't believe it? Listen to the spin from BBC Three controller Danny Cohen: "This year the people who are organising the festival are much more keen to have a more positive tone. We want to celebrate creativity and the talent behind some of the best shows on television. Good ground has been made on trust but there is still some work to be done." Hold us back.

Journalist and broadcaster Muriel Gray, who returns from a long absence to chair a debate at this year's festival, believes the whole topic was blown out of proportion.

"I'm not entirely convinced TV lost the public trust in the first place. The phone-in thing where TV channels duped viewers into entering competitions whose winners were already decided was awful but the blaming of honest documentary makers was based on hysteria worked up by the press. I will not allow the Daily Mail to lecture me about honesty."

So will Fincham come out cheering for the poor, maligned documentary maker?

"Now he's in a job, it will be bland. I wish he'd been speaking when he was still on the dole," observes Gray.

SCOTLAND
ALTHOUGH to London-based TV executives, Scotland, if considered at all, is the land of tartan tat and whimsy, the creation of the investigatory Scottish Broadcasting Commission (SBC) has shaken things up.

As the SBC prepares to publish its findings, the state of Scottish TV - not a subject that has often kept channel controllers awake at night - is elbowing its way into the consciousness of some of TV's most powerful elite.

Sky's Richard Woolfe welcomes the prospect of a digital channel for Scotland, one of the central ideas that has come out of the debate, and highlights the potential that digital television provides for a range of similar projects.

Danny Cohen, controller of youth-oriented channel BBC Three and a copybook metropolitan provincial, confesses to being "unclear" (read uninterested) as to what was happening north of the Border.

Bobby Hain, SMG's director of broadcasting, says it doesn't matter if London controllers are keeping up, the demand for change has been heard at the department of culture, media and sport, and media regulator Ofcom: "I'm not sure it has registered with the TV festival community but I don't think that matters - this is about the Scottish creative community."

However, the "creative community" is hardly united on what needs to be done. Says Gray: "I think it a digital channel for Scotland is a ghastly idea. What Scotland needs is one of the major channels, such as BBC One or BBC Two, to be relocated to Scotland, not some specialist channel that nobody will watch and will be filled with crap. Anything apart from moving a channel is just tokenism - it's shut up jocks, you can have this'."

DIGITAL SWITCHOVER
TO MOST of us, digital switchover means an extra £100 for a digibox for the TV and some adverts with a naff robot, but to TV people it symbolises something far more sinister: audience fragmentation.

This - a key worry for the movers and shakers in commercial TV - means mass audiences have splintered into smaller, more niche groups bringing down the amount of money that can be made from placing an advert on a show, posing new headaches for programmers on how to attract and keep an audience.

In 2012, the analogue signal will be turned off, leading to a situation leading television producers ominously call "the wild west".

Nobody knows exactly what will happen - whether the big five terrestrial television stations will be able to maintain their audience share once they cease to enjoy pole position on the nation's TV sets - but sure as eggs-is-eggs, finding the best ways to attract viewers, the most startling new ideas for shows and the best ways to keep advertisers happy, will be the cause of head scratching come next weekend.

BBC Three controller Cohen's performance will be one of the big talking points. Despite enjoying a budget of £83m and enjoying a mandate to engage audiences in the 16-35 age range, many of Cohen's programmes - such as a social networking chatshow hosted by Lily Allen - have bombed with audiences and attracted critical brickbats. Leading BBC figures such as broadcaster John Humphrys have called for the station to be scrapped to protect the corporation's news content.

"With the best will in the world," shrugs Cohen, "those people are not in the target range for the show so I'm not too concerned."

Not surprisingly, Gray has a viewpoint: "You can still attract big audiences. You just need to remember to make something that is of high quality and you can't make high-quality programmes without a budget.

"Look at STV - because they've stopped spending money they're now churning out crap."

Nonsense, cries SMG's Bobby Hain: "We agree that you need to spend money to make great programmes but the idea that we don't is rubbish."

... AND THE USUAL NETWORKING
SMG's managing director of content Elizabeth Partyka underscores the obvious point that the festival, worth £2.3m to the local economy, is like no other media gathering held in Scotland.

"It is extremely important because it is the one time of the year when the movers and shakers are on our doorstep. For the other 51 weeks of the year we have to go down to London on the old red eye sleeper train, but next weekend they come to us."

Partyka says hard and fast business is rarely done, no commissions are won and few deals are ever struck in classic festival haunt, the bar of Edinburgh's George Hotel. But invaluable connections - the meat and drink of the television industry - are made.

"It lets us get a glimpse into the mind of the commissioners, they are just people after all. These are the folk who you have to wait three months just to get a space in their diary, but in Edinburgh they are all there. From a simple off-the-cuff comment a spark can grow."

Sky's Woolfe believes the festival provides an unparalleled opportunity for young, inexperienced people trying to get an idea off the ground.

"It's the one time of the year when somebody can just tap you on the shoulder and pitch something.

"I remember what it's like trying to break into the industry and at Edinburgh people can just go straight up to controllers and tell them about an idea."

Again, though, the media merry-go-round is not for everyone. Last word should go to the ever-gallus Gray, who says networking rarely nails down a programme or a series.

"They will commission an idea if it's good. The idea people will buy something because they've been out with you for dinner is nonsense."

The Edinburgh International Television Festival runs from Friday, August 22 to Sunday, August 24