ITV battles UTV for stake in Irish channel

Elmo

From the Gaurdian

by Lisa O'Carroll
Tuesday April 11, 2006

ITV is battling against another channel 3 licensee, Ulster broadcaster UTV, for control of Ireland's only privately owned terrestrial TV channel, TV3.
Formal bids for Canwest's 45% stake in TV3 were due in last week and UTV has confirmed it has made an offer.

Setanta, the ambitious Irish pay-TV sports outfit, and BSkyB have both pulled out of the bidding, creating an apparent two-horse race between UTV and ITV for the Canwest stake.

10.15am

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ITV battles UTV for stake in Irish channel

Lisa O'Carroll
Tuesday April 11, 2006


ITV is battling against another channel 3 licensee, Ulster broadcaster UTV, for control of Ireland's only privately owned terrestrial TV channel, TV3.
Formal bids for Canwest's 45% stake in TV3 were due in last week and UTV has confirmed it has made an offer.

Setanta, the ambitious Irish pay-TV sports outfit, and BSkyB have both pulled out of the bidding, creating an apparent two-horse race between UTV and ITV for the Canwest stake.


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ITV already owns 45% of the channel and listed TV3 as a "core asset" in its strategy review last September.
In an "all or nothing" clause in its existing shareholder agreement with Canwest, ITV has the right to top UTV or any other bid, but if it decides against it must sell its shareholding completely.

TV3 has been valued at around 200m euros (£139m), but according to analysts in Dublin UTV is "really keen" to get control of the channel and has put in a bid for the Canwest stake that values the broadcaster as a whole at 250m euros (£174m) plus.

"We can confirm we have put in a bid," said a spokeswoman for UTV.

Canadian media firm Canwest put its 45% stake in TV3 on the market last month after it failed to get its asking price in a private deal with ITV.

TV3 is Ireland's only commercial terrestrial network and represents a significant strategic opportunity for UTV, which is trying to carve out a new life independent of its core Ulster ITV franchise business.

After its acquisition of Wireless Group last year, UTV is looking to a future where radio revenues outstrip those from TV. And if UTV were to snap up TV3 it would achieve its holy grail of an all-Ireland TV operation.

UTV's chances of winning the battle depend on how desperately ITV needs to raise cash in the wake of the failed takeover bid led by Greg Dyke.

The ITV chief executive, Charles Allen, may decide he needs to reward shareholders who stood beside him during the recent takeover bid by returning cash to them, which could be funded by selling off more assets including TV3.

Fewer than six expressions of interest were submitted last month in the first phase of the sale of Canwest's TV3 stake and, according to reports in Ireland, at least one of those came from venture capitalists Advent. It too has now pulled out of the bidding.

The main stumbling block for Setanta and BSkyB was the future of TV3 if ITV decided to sell out. At the moment the station can guarantee ratings courtesy of an output deal with ITV that delivers programmes such as Coronation Street and Emmerdale and The X Factor.

However, this agreement runs out in less than two years and were ITV no longer a TV3 shareholder the shows would go back on the open market. Sources said this uncertainty made it "impossible" to value the channel.

The programme supply agreement is already the subject of a bitter court action - TV3 is suing ITV at the high court in London after the UK firm began broadcasting in the clear on Sky in the Republic of Ireland.

TV3 has argued that making Emmerdale and other ITV shows available to everyone by beaming into the republic by satellite, ITV has undermined its exclusive commercial arrangement to supply TV3 in Ireland.

The Irish channel has enjoyed a massive growth in ratings and advertising revenue over the last four years since it got access to ITV programmes, which had previously run on RTE for more than two decades.

And Setanta stop bidding

http://www.timesonline.co.uk/article/0,,2095-2124960,00.html

Pity.

Mossy Monk

but if ITV have first refusal then how is it a bidding war?

TV3 is suing ITV at the high court in London after the UK firm began broadcasting in the clear on Sky in the Republic of Ireland.

great journalism :rolleyes:

Elmo

TV3 is suing ITV at the high court in London after the UK firm began broadcasting in the clear on Sky in the Republic of Ireland.

This is true as far as I know.

flogen

Didn't even hear that Sky were interested; I wonder if UTV would rebrand on the back of a buyout... I think it might.

BuffyBot

I think it might.

I'd highly doubt it. They might integrate the two stations in the background, but the corporate identities would probably stay as they are. UTV's brand in NI is way too strong to meddle with, apart from the political sensitivities, and I'd imagine they wouldn't want to tamper with TV3 too much down here.

As it is, UTV run a multitude of brands in the radio sector, so there would be any reason to assume they would do anything different in the TV sector.

Mossy Monk

Elmo wrote:

This is true as far as I know.

it is indeed true but it is broadcasting via Astra 2D, not Sky. you do not need Sky equipment to view

flogen

Fair point; what would they do with broadcasts though? I always assumed UTV saw the purchase of TV3 as a way to have an all-Ireland station, perhaps that's wrong though. I guess they could and would still act as different stations, I've always forseen the possibility of them becoming one station though.

You're right about brands, dropping the "U" would be a politically sensitive move and would damage viewership in NI, but renaming TV3 to UTV would distance the broadcaster from viewers in the republic who view it as a NI broadcast...
Maybe rename both to I(reland)TV?

Mossy Monk

if UTV were to take control i can see no reason why both channels could keep their identity but simulcast programming with opt outs for news and so on

overall i think it will be the viewer who will lose as it will lessen choice as i can see TV3 becoming more like ITV

DMC

Don't forget: from BCI.ie

Contract Expiry Date: 19th September 2008

Two and a half years is not a long time away, and the BCI will be looking for applicants for this when it expires, applications might be sought within the next 12 months.

So... with players like Setanta and BSkyB staying away, and if Channel 6 keeps up its promise for original Irish programming.... its not a done deal that TV3 will have a new licence.

I would'nt buy it.

Elmo

Even if someone puts forward a good case for not returning the licence to TV3 (and lets face it we could all put forward a case for not letting them have the licence again) it is unlikely that the BCI won't return the licence to TV3.

Channel 6's promises of Original Irish Television is as good as seeing a Long running drama serial on TV3. and Pigs might fly.

flogen

Elmo wrote:

Even if someone puts forward a good case for not returning the licence to TV3 (and lets face it we could all put forward a case for not letting them have the licence again) it is unlikely that the BCI won't return the licence to TV3.

Channel 6's promises of Original Irish Television is as good as seeing a Long running drama serial on TV3. and Pigs might fly.

Well, the BCI not returning licences is pretty uncommon in radio, and while the possibility has not existed in television yet, there's no reason to believe it will be any different.

However C6 might take 2008 as an opportunity to kick up a fuss, perhaps they might take a legal road?
Then again, even if UTV were to simulcast completely (including news), someone could argue that programming made in NI is still Irish programming... they just wouldn't say it loud enough so the Unionists could hear them

BuffyBot

I always assumed UTV saw the purchase of TV3 as a way to have an all-Ireland station, perhaps that's wrong though.

I think UTV would be quite happy to have an official all-Ireland broadcasting remit. I don't think they care too much how that comes about, or that it will be under two seperate franchises.

Elmo

If UTV does take control of TV3, ITV are still in a win suitation.

1. They get 100mill for the sale
2. They continue to sell ITV Productions to TV3
3. This could increase as UTV may wish to make TV3 more like UTV by providing more ITV productions.

And then their is the name. Both are well known. But if UTV decides to change their name to TV3 (or viasa versa) Their could be a reduction in viewers from the Republic since UTV has a good number of viewers.

Ulsterman 1690

If UTV did acquire TV3 there is no reason for them to change the name of either station.

In NI UTV is such a well established name that it would be madness to rebrand. There is no compelling reason to rename TV3 either (unless when when DTT eventually gets off the ground TV3 gets a second channel to play with) LMC-TV would be a bit of a mouthful !


UTV have always drawn some of its advertising revenue from the Republic. If UTV owned TV3 they could concentrate on the NI market and leave TV3 to concentrate on the South (having said that there are quite a few areas of the Republic where UTV reception is better than TV3 :rolleyes:

Elmo

UTV have always drawn some of its advertising revenue from the Republic. If UTV owned TV3 they could concentrate on the NI market and leave TV3 to concentrate on the South (having said that there are quite a few areas of the Republic where UTV reception is better than TV3

Unlikely to happen as 1/3 of UTV's revenue comes from the republic, 1/3 from the North and 1/3 from the franchise. UTV is also a stong brand in the republic.

I could prehaps imagine UTV 1 (UTV in its current state) and UTV 2 (TV3 but more like what TV3 was in the beginning with but with late night repeats of ITV Productions and Pop Idol extra ala ITV 2) And if DTT arrives in the Republic UTV 3 (more US imports :rolleyes: ).

Also UTV could look towards this as getting rights to GAA matches.

I think that ITV will take over the station. Rename it ITV Ireland. Brand is everything after all.

Gonzo

would be great if ITV took it over and renamed it ITV1 Ireland, we would then prolly get ITV2-4 back on Sky and on the epg and all! but I cant see that happening.

Elmo

would be great if ITV took it over and renamed it ITV1 Ireland, we would then prolly get ITV2-4 back on Sky and on the epg and all! but I cant see that happening.

I honestly don't see why people like ITV so much it is the most unoriginal and conservative TV service around.

ITV 1 - Coro St and Emmers (Older Market)
ITV 2 - The extra's channel (Younger Market)
ITV 3 - A policing/vigulanty service (Busy bodies like Miss Marple Market)
CITV/ITV4 - Kids and soft porn (a very scary niche market, oh no)

Perhaps not so conservative after all.

Mossy Monk

Elmo wrote:

CITV/ITV4 - Kids and soft porn (a very scary niche market, oh no)

do we see the same ITV4?
soft porn i think not

Elmo

do we see the same ITV4?
soft porn i think not

I haven't actually seen ITV4, I assumed that it was taking over from Men&Motors, But I am wrong. Oh well!

Perhaps I haven't given ITV services that much credit.

Also I was joking.

Mossy Monk

ITV4 and Men & Motors are 2 completely seperate channels

also, Men & Motors has thankfully cut down on the ****ty porn programs

Elmo

ITV4 and Men & Motors are 2 completely seperate channels

I was sure there was talk to bring Men&Motors into the ITV brand, and that it would be ITV4. It was a Granda Company.

I am looking forward to ITV Play. How low can TV go?

flogen

Elmo wrote:

How low can TV go?

If you watch The Mint on ITV1 at night you'll get a fair idea...

Mossy Monk

Elmo wrote:

I was sure there was talk to bring Men&Motors into the ITV brand, and that it would be ITV4. It was a Granda Company

it was no more than a rumour

watty

We have had ITV4 along side M&M a while now.

Telefís

In all of this I keep wondering about the impact on the existing UTV channel. As it is, UTV as pointed out, earns at least one third of its revenues from the Republic, and for many of its popular programmes has more viewers in the south than in the North. This has to have an impact on advertising revenues if much of its output is going to be simulcast on TV3.

It'll also be interesting to see what the impact on the TV3 news service will be. Will they have access to the significant clout of UTV's highly professional news operation in Belfast? And what of further links to ITN in London? Will popular Ulster content like Jenny Bristow's cookery, Insight, and magazine and current affairs prgrammes migrate to TV3? And what of increased access to ITV programming via the northern franchise?
So many questions...

Elmo

Will they have access to the significant clout of UTV's highly professional news operation in Belfast?

?????

Highly Professional News Operation + UTV ??????

They are stuck in the 1980's
The presenters are dreadful
The Graphics are in need of some serious upgrading

No No No

Will popular Ulster content like Jenny Bristow's cookery, Insight, and magazine and current affairs prgrammes migrate to TV3?

Jerry Kelly ahhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhh TV3 just got worse.:(

byte

Is there ever any chance that UTV could be forced to be removed from cable lineups?

If ITV take full control of TV3, I'd imagine it would be even less likely that TV3 would welcome UTV to broadcast in ROI. Of course, UTV is already FTA on satellite, but for the likes of NTL/Chorus, etc., is there ever a chance that there would be legal pressure to remove the channel from their lineup due to conflict of interests?

Just curious.

watty

I think under EU law such an act would be deemed illegal. As it is TV3 is likely to lose any pending cases.

If RTE had seriously wanted to contend with C5 over "Home & Away" on NTL they might have won. But Neither NTL or RTE was much interested in fighting Five's injunction. "Home & Away" was never blocked on "Five" on any rebroadcasts or networks here by RTE.

flogen

Just a bit of a what-if that came to mind about this whole thing; what if ITV buy the other 45% (and the additional 10% that is supposed to be sold too), and thus create ITV Ireland, even if they chose to remain as TV3 for the time being...
Who sells the regional franchises for ITV, is it ITV plc or another group?? The reason I ask is because I can imagine if ITV create an ITV Ireland platform they'd see no reason to continue their franchise deal with UTV once the existing contract continues... ITV has made great effort to buy up all the regional franchises over the last few years but UTV has backed itself up with radio companies making it a bigger feat to takeover; ITV might prefer to take the region back through a plan B if it's possible; if they refused to give UTV the next contract and broadcast TV3/ITV Ireland to the North (not sure if this is already happening on a ATT basis, but it could as a result of GFA etc.)... Is this possible?

DMC

Um, I think you might be mixing a few things up...

The state of play is that UTV are the Channel 3 Licence holder, granted by Ofcom (and the ITC before it), which has nothing to do with ITV plc. except that it shows the programmes on a federal basis. UTV pay the going rate for income/size of audience to ITV to show their programmes. As this wasn't that important decades ago, you can be sure that it is a big thing in the years to come.

The Channel 3 licences for Northern Ireland and Scotland are recognised in law as needed to give a bit more in regional programming than the English regions (Wales didn't have this requirement)

But these licences were given out in analogue days, and over the past few years, ITV have been pressurizing the UK govt and Ofcom to relent a bit on their PSB commitments, because, come 2012, ITV won't be one channel in 5, it will be one channel in at least 30 or more. Those licences will not be offered again.

So, whither UTV....

As I see it, UTV are planning their exit strategy from Channel 3 licence holder. A hard thing for them to do, on the face of it, as it is run like it was a family company for so many years, and still is their bread and butter. But with such a big buy such as The Wireless Group (TalkSport) and a big noise in Radio down here (LMFM, Limerick's Live 95 FM, Cork's 96/103FM, Q102 in Dublin) and in NI now (U105 in Belfast) it's hard not to see whats being planned in Havelock House.
All that has to be done, is ITV to name their price and UTV agree.

SRB

U105's RAJAR figures will be interesting - at the moment, if it falls flat on it's face UTV have a healthy cash flow and can "sort it out", if it does well, it may speed up their exit.