It was established in response to demands for a channel to cater for the Welsh-speaking minority population in Wales, which previously had been served by occasional programmes in Welsh transmitted at obscure times on BBC Wales and ITV/HTV to the dissatisfaction of both the Welsh-speaking community which was badly served, and of the non-Welsh-speaking community which found the English programmes seen in the rest of the UK often rescheduled or not transmitted at all. S4C's remit was to provide a service which is in the Welsh language in peak viewing hours.
S4C does not produce programmes of its own, instead it commissions programmes in Welsh from independent producers (although the quantity purchased from HTV has greatly reduced since the early years of S4C), and it has particularly developed a reputation for producing cartoons, e.g. SuperTed, Fireman Sam ('Sam Tân' in Welsh), Shakespeare - The Animated Tales, etc. The BBC fulfills its public service requirement by producing programmes in Welsh (including S4C's News and the soap opera Pobol y Cwm) and providing them to S4C free of charge. For that part of the day outside the peak period, S4C shows programmes produced for Channel 4 in the rest of the UK (though often several days later).
TV movies produced for S4C have received some good foreign reviews - Hedd Wyn being nominated for the Best Foreign Language Oscar in 1993 and Solomon and Gaenor being nominated in 1999.
In addition to the analogue tv signal transmitted throughout Wales, S4C owns the licences to two multiplexes on Digital Terrestrial television throughout the UK via its subsidiary company SDN (S4C Digital Networks). Within Wales on DTT, and throughout the UK on Digital Satellite broadcasts, S4C transmits an exclusively Welsh-language service, S4C Digidol (S4C Digital), and S4C2 which broadcasts sessions of the Welsh National Assembly. One benefit of DTT in Wales is that Channel 4 can now be broadcast alongside S4C.
S4C is financed from its advertising revenue and a fixed annual grant from the UK Department of Culture, Media, and Sport (DCMS).
S4C is controlled by the 'Welsh Fourth Channel Authority' , an independent body unconnected to the bodies which regulate the other UK television channels such as the BBC, ITV, or Channel 4.