9.38am: Slow start, but the auditorium is now pretty full. Bacon and Murphy had a bet about how many people would turn up so early on Saturday morning. Bacon won, and Murphy hands over the £15 wager.
Murphy says that he gets more nervous as Sky's programming gets more successful, mostly because you "get fired instantly if it goes wrong". He said that around 60 shows on Sky1 now bring in over 1 million viewers, but adds that "when something is a success it is there to ruin".
There's now a showreel of Sky1 programmes, including Mount Pleasant, Trollied and An Idiot Abroad.
9.46am: Murphy says that working with Ricky Gervais made him "raise his game". He says that An Idiot Abroad is a work of "comedic genius". Gervais paid tribute to Murphy yesterday for giving him creative control. Reveals that when he was at BBC Three, Gervais called him to praise Jonathan Ross's Japanarama. He says that Matt Lucas also used to do this.
9.51am: Murphy says he had dinner with Gervais last night and The Office creator discussed a couple of ideas that Murphy is keen to greenlight for Sky1. One idea involves working with a comedian Gervais likes and another is a comedy format. Says that he backed the ideas without needing firm details due to faith in Gervais.
Murphy says that when he first started at Sky he wanted to "nick" Gavin & Stacey. He phoned Baby Cow and asked them to bring it over. Henry Normal, head of Baby Cow, considered Sky's offer, but ultimately decided to stick with the BBC.
Murphy has since signed up Ruth Jones to make Stella and made many series of League of their Own with James Corden. Also signed up Joanna Page for Gates, and so has pretty much "picked off" the whole cast of the show to work for Sky1.
9.55am: Discussing the difference between working at BBC and Sky. Praises BBC One controller Danny Cohen and the corporation's creativity, but says that getting ideas made was sometimes "like dragging the Queen Mary through a sea of Mars Bars". Says that the ideas process at Sky is "fleet of foot", and things can get done much quicker and easier.
Says that he wants to refocus Sky1 as a "broad entertainment channel", but has previously made mistakes by not understanding the broad nature of the channel's audience. He says he picked up too many random programmes that were not right for Sky1 viewers.
Talking about Pineapple Dance Studios, says the show got around 250,000 viewers for each episode, same for Louis Spence's Showbusiness, which did not bring enough ad revenue in. But says that he would work with Spence again.
10.04am: Talking about Sky's pledge to up its investment in UK programming by 50 percent to around £600m a year by 2014. Says that Sky currently spends more money on UK comedy than Channel 4, and that comedy is very important for Sky going forward. Its about "turning the dial" with UK comedy fans, he says.
Asked about "poaching" talent from other broadcasters, such as Davina McCall, David Walliams and James Corden. Denies that its about stealing talent, but rather says that he had previous relationships with them and is perfectly free to commission from them.
Says that it is "very important" for Sky to have top talent, as "if you are paying for something, you are not going to pay for something if its not as good as free". Adds that "Sky has to make free TV feel inadequate". This means that cannot just have unknown talent, has to have top stars. Also about having talent that fits with Sky's "good family brand".
10.12am: Reveals that Sky is the second biggest spender on marketing in the UK, and says that promotion is vital. Sally Lindsay did 47 press engagements for new series Mount Pleasant and Murphy says that "if we are going to pay someone we expect them to sell it".
However, he accepts that ratings for Sky1 shows are not always reflective of marketing investment. Pinpointed David Walliams's Wall of Fame as one show that didn't perform well. He is meeting Walliams in a few weeks to discuss the show's future. Says that one of the problems was that they didn't work out how to make the most of Walliams's talents.
Says that he is "undecided" about bringing back Wall of Fame, but would need to make the programme less "processional" if it did return. However, says that he definitely wants Walliams to be part of Sky1 and could find another format for him.
10.20am: Showing a video of views on Sky1 - a mix of industry types and consumers. Some people say that Sky1 is not distinctive enough and lacks identity. Murphy accepts the criticism but says that some shows have made a "brilliant statement" about the channel, such as Ross Kemp In Afghanistan and Modern Family.
Says that he has made mistakes with introducing anything surreal or that makes viewers "try too hard", such as pets show A Different Breed. "What a mess", he says, accepting that pet programmes "have not worked". Feels, though, that the "warm, loving, dysfunctional, yet redemptive" comedies such as Trollied and Mount Pleasant will work.
Says that Sky1's comedy plan will next look at "other comedic tones" in future. Points out that he commissioned darker comedies such as Nighty Night, but these sorts of programmes may work better on Sky Atlantic. Have signed up Charlie Brooker to write A Touch of Cloth, a new detective comedy starring John Hannah and Suranne Jones. Says that this show has Airplane-style humour.
10.24am: Praises BBC series Sherlock and Doctor Who. Reveals that he tried to nick E4's smash hit comedy The Inbetweeners for Sky1, but failed. Says that he would "love" to work with the show's talent, and jokes that he will "make it happen".
10.25am: Hits out at "snobs" on MediaGuardian's comments section for criticising Strike Back. Says that they misunderstand the show as it's "not supposed to be f**king State of Play". Says the show is all about the broad entertainment appeal of Sky1.
10.31am: Says that Sky1 could do a live studio gameshow featuring interactivity, similar to Channel 4's The Million Pound Drop or ITV1's The Cube. Would consider a business reality show similar to The Apprentice, but would want "genuine jeopardy" for contestants. Says that contestants on The Apprentice "only have their dignity to lose and that is in short supply". Praises MasterChef for creating an environment where contestants "cry if they make a mess of a souffle".
10.35am: Expresses high hopes for the Sinbad remake and says that Treasure Island, starring Eddie Izzard and Elijah Wood, will most probably run around Christmas and into the New Year. Reveals that Sky Atlantic is "open for business" for documentaries, following the launch of Fish Town on the channel. Also says that Sky Atlantic could air a quiz show.
10.35am: Finishing with a video tape of blockbuster entertainment shows coming soon on Sky1, including Jurassic Park-style series Terra Nova and new drama Spy. And that's your lot...