Cables, programs and Dishes

watty

Satellite television company BSkyB has bought a 17.9% stake in ITV for £940m ($1.8bn) - but said it had no plans to make a full bid for the UK company.


A ploy to block NTL attempt to merge or takeover ITV.

http://news.bbc.co.uk/1/hi/business/6159780.stm

Either taking over ITV IMO would be bad. RTL is also alleged to be considering a takeover. While not great, that IMO would be a lesser evil.

NTL recently sold it's Irish operation To Liberty/UCG/UPC (who also aquired Chorus) and merged with TeleWest. Then in Merging / Take over of Virgin Mobile, Richard Branson now has 18% of the new NTL:Telewest which will rebrand as Virgin Media next year.

Blink and you'll lose track of this.

DMC

Sky will never be allowed to take over ITV. Competition laws should prevent this, they would in the past, unless there is something in the last broadcasting bill that will allow it.

ITV are in a very vunerable position. Leaderless, rudderless, (more so than ever, I hear you cry!) ITV are right that if NTL do take over, its paid for in cash. RTL is their white knight, I feel.

L1011

BSkyB can't own >20% of the shareholdings of the ITV fanchisers collectively IIRC, meaning they can only take under 30% of ITV Plc or so before they hit that ceiling, as SMG+UTV+Channel combined are much much smaller...

watty

Yep, Sky infact have public said they have no ambition for takeover and only increased shareholding to try and block NTL.

It says something about how low UK commercial TV has fallen that C4 closed Film production and ITV's White Knight is RTL!

channelsurfer

it does put them in an nice postition to errrr. review the viability of freesat from bbc/itv and consider a better future would be to use the generous offer of resources of NDC to ensure that only the Uk viewer will view their channels. Any takers on this point that sky will look to itv to return to ftv at future agm's of itv plc or whatever it will be called.

JohnC.

I've heard that RTL may not be allowed to take over ITV either, as they would then have both commercial channels. Don't know how true that may be. It was just speculation.

watty

channelsurfer wrote:

it does put them in an nice postition to errrr. review the viability of freesat from bbc/itv and consider a better future would be to use the generous offer of resources of NDC to ensure that only the Uk viewer will view their channels. Any takers on this point that sky will look to itv to return to ftv at future agm's of itv plc or whatever it will be called.

no. Sky would want paid the millions for its artifical "costs". They aren't that desparate to see ITV/BBC FTV vs FTA. It really is very very little financial advantage to sky, unless it was subscription only, which unlike the Irish Gov and RTE, the UK Gov will not wear terrestrial TV being subscription based on Satellite.

DickDastardly

Yesterday, ITV rejected the NTL bid:

"The board believes that whereas there is obvious appeal to NTL in gaining control of ITV's substantial and successful business, from ITV's perspective there is little, if any, strategic logic for ITV to combine with NTL."

I can't fathom just how poorly managed ITV is that it's unable to see the benefit of merging with NTL. It's quite simple really. ITV is following an outmoded strategy of making cheap programmes and broadcasting on one channel. Ever since digital TV this strategy is becoming more and more irrelevant. The BBC have diversified their output, for example, with extra stations and Freeview.

Merging with NTL would put both companies in a far better position in the UK media. You'd have a viable competitor to Sky, with ITV's content and NTL's content delivery.

It's hard to believe that ITV would rather be bedfellows with Sky, who are largely responsible for the broadcaster's decline. When ITV did enter the digital market, with ITV Digital, they simply couldn't compete and had to wind that enterprise up. If I were ITV I would be opposing any Sky approaches and would be trying to make a competitive deal with NTL.

ITV will no doubt survive under Sky, but it will not be relevant and no dramatic changes to the media landscape (i.e. real competition) will be seen.

Foggy43

This stake buying has nothing to do with programme quality. It is down to control of the media.

I am not sure if I am allowed use names here so I will use initials.

An Australian business tycoon RM owns and controls most of the media here in the UK. Virgin's RB is not happy with Sky's stake in ITV. RB went as far to say RM will decide who the next British Prime Minister will be. It is widley accepted here that Labour would never have got in to power without RM changing his support from Tory to Labour.
RM is also a strong supporter of a certain individual in a 'white house'. Fox News got him re-elected.

DickDastardly

I'd agree with your assessment on the situation, Molly. Unfortunately, it looks as if Britain will be left with BSkyB as the predominant force in the media, in that it controls the delivery mechanism (satellite), content (sports and news) and external channels (e.g. it can boot a certain station of Sky if it wishes).

Freeview restored a bit of balance but it looks as if Murdoch will be able to meddle into this as a result of his 17% stake in ITV. The Beeb said that Sky's stake in ITV is their "worst nightmare". Pity ITV don't have the sense or direction to see that it's the end of their "independence" as soon as they are aligned with Sky and Murdoch.

The UK media situation naturally has a knock-on effect on the Irish market, which is unfortunately dominated by Sky with no sign of a viable alternative (NTL, Chorus etc. are little more than resellers of the Sky product). I'd be all for ITV/NTL as it would create an alternative to the kind of mindset monopoly that you are describing, Molly. At least Branson is going to fight the deal, but he should be getting a warmer reception from the "heads" (or should be just say folk) at ITV.

An opportunity for a "transformational deal" scuppered.

watty

NTL takeover would be very bad too.

Best would be independent. Next best option at the moment seems to be RTL, which is not a purveyor of High Class TV judging dfrom "Five" and the mainland Europe RTL channels I get. (Though maybe the encrypted ones are better?)