ITV considering abandoning freeview/FTA platform

mike65

clicky

TV has held talks with BSkyB about switching its advertiser-funded free-to-air digital channels such as ITV2 to subscription, meaning they would no longer be available to Freeview viewers.

The commercial broadcaster has been forced to consider the radical option in the face of the worst advertising downturn in its 54-year history. The move comes despite the free-to-air strategy having made ITV2, the youth-oriented entertainment channel that broadcasts shows including Britain's Got More Talent and American Idol, the most watched non-sports digital channel in the UK.

It is understood that ITV has held talks with BSkyB about switching ITV2, ITV3 – which focuses on classic ITV dramas such as Inspector Morse – and ITV4, home to more male-oriented programming such as live football, to subscription.

Under one option, ITV could pay a nominal carriage fee to BSkyB for broadcasting the channels and in return receive a guaranteed cut of revenues from channel packages sold to pay-TV subscribers. BSkyB remains ITV's largest shareholder, owning 17.9% of the company, despite having been told by competition regulators to reduce its stake to less than 7.5%

A bad idea ITV2/3/4 are a central plank of Freeview, so this could be a short term "fix" with long term reprocussions.

byte

They'd be pretty important channels on FreeSat too.

Could they not condense the programming into 3 ITV channels, instead of the 4 they have now? They could push M&M stuff onto ITV4...

And get rid of the timeshift channels. Small savings I guess doing the above, but there should be savings nonetheless?

snaps

Seems this has appeared again:

"A report in the London ‘Mail on Sunday' says that new ITV network chairman Archie Norman intends making an early stamp on his authority by starting to charge for accessing ITV's minority thematic channels.

The ITV channels (ITV2, ITV3, etc) are available to satellite, cable and digital terrestrial viewers across the UK, and encryption the channels will make a major dent in the number of ‘free' channels available to viewers.

The reports says the change could take effect as soon as January. However, the last time ITV moved into pay TV it almost cost the bankruptcy of the complete network. That last venture (‘OnDigital' and subsequently ITV Digital) spectacularly went bust in May 2002."

To me wont be any great loss, but surely this is suicide by ITV? What are the implications on the freesat partnership with the BBC?

icdg

snaps wrote: »

Seems this has appeared again:

To me wont be any great loss, but surely this is suicide by ITV? What are the implications on the freesat partnership with the BBC?

Its Freeview I'd be more worried about (for ITV, that is) as it would effectively amount to ITV's prescence on the platform being reduced to ITV1. There is no longer any pay-TV on UK DTT other than Top-Up TV (which, ESPN aside, isn't really a subscription pay-TV service as we know it any more, but rather a form of quasi-VOD) so the ITV channels would have no home on that platform. ITV's advertising revenue for the channels is bound to be significantly hit with the loss of DTT viewers although it could be made up with subscription revenues. That's what ITV management will need to weigh up in their cost-benefit analysis.

snaps

let them go pay tv then at least then no more x factor! BBC must be so chuffed with this! BBC 3 is so good compared to that s*ite that itv roll out

Mike 1972

any chance they could keep ITV3 and get rid of ITV1 instead ?

icdg wrote: »

Its Freeview I'd be more worried about (for ITV, that is) as it would effectively amount to ITV's prescence on the platform being reduced to ITV1.

Dont forget the lack of ITV in the early days of $ky digital didnt seem to hinder uptake of the platform much ?

mailforkev

Since getting Sky a couple of years ago (where ITV isn't on the main planner), I'd say we've only made the effort to look at any of the ITV stations a dozen times, and at that it was just to check if there was anything on (answer usually was no).

Too many awful reality/fly-on-wall/chat shows on 1 and 2, and reruns of Poirot, Colombo etc. on 3 and 4.

If they stopped broadcasting entirely tomorrow I honestly don't think I'd notice.

Elmo

Mike 1972 wrote: »

Dont forget the lack of ITV in the early days of $ky digital didnt seem to hinder uptake of the platform much ?

More down to ITV 1 rather than ITV 2, 3 and 4. IMO if Sky want to replace Sky 3 on FreeView with PayTV Sky 1, ITV may as well start charging.

Remember if ITV go the pay route even if they are on just the basic packages the will get a fee for those 3 channels, they may be looking at the success of UKTV.

icdg

Mike 1972 wrote: »

Dont forget the lack of ITV in the early days of $ky digital didnt seem to hinder uptake of the platform much ?

I didn't mean it would hinder Freeview, I meant it would hinder ITV! There was reason they bit the bullet when it came to Sky after all, it was the UK's largest digital platform. Freeview has grown in popularity to the point where it is now available in more homes than Sky (in theory, in practice many Sky homes will also have Freeview). But cutting yourself off from millions of viewers, is when your primary business is selling advertising, not the greatest move.

Elmo

I assume that they hope to pick up the loss in Ad Rev by charging people for ITV 2, 3 and 4.

If they move all sports coverage over to ITV4 it will be a major plus.

Pat Gleeson

Elmo wrote: »

If they move all sports coverage over to ITV4 it will be a major plus.

It would be unfortunate for us, as it's absolutely certain that ITV 2-4 encrypted would not be made available to Ireland.

ITV tried this predominantley sports centred pay-tv model before with On/ITV Digital. Using Championship and Champions Leauge football as the main offering it failed miserably, haemorraging money like nobody's business. What makes them think this plan would work any differently?

Elmo

Pat Gleeson wrote: »

It would be unfortunate for us, as it's absolutely certain that ITV 2-4 encrypted would not be made available to Ireland.

ITV tried this predominantley sports centred pay-tv model before with On/ITV Digital. Using Championship and Champions Leauge football as the main offering it failed miserably, haemorraging money like nobody's business. What makes them think this plan would work any differently?

ITV 2 - 4 is that readily available on Irish Networks, UPC got rid of ITV3 a few years ago and TV3 certainly don't want them. Are ITV 1, 2, 3 and 4 on the Sky EPG?

I think that ITV may look at the possible leverage they have of getting money from Virgin and Sky for their 3 extra channels on the basic package, and I am sure a number of FreeView viewers may pay to get those extra channels. This money plus the additional advertising revenue maybe worth allot more than just Advertising.

Now that Digital is far more available ITV might think that it isn't such a risk.

Digifriendly

Elmo wrote: »

I assume that they hope to pick up the loss in Ad Rev by charging people for ITV 2, 3 and 4.

If they move all sports coverage over to ITV4 it will be a major plus.

Can't agree with this for if ITV 4 becomes a subscription channel then no sport on Freesat for those who bought into it in ROI to get FTA sport and for Freeview viewers in NI who like sport this would be a disaster too. Are you suggesting all coverage of Champions League football becomes pay only in UK?

Pat Gleeson

Elmo wrote: »

ITV 2 - 4 is that readily available on Irish Networks, UPC got rid of ITV3 a few years ago and TV3 certainly don't want them. Are ITV 1, 2, 3 and 4 on the Sky EPG?

No they are not, they are added manually, which is related to my point. If ITV encrypts, there is no chance they would be made available to Ireland on Sky. Granada Plus was replaced by ITV3 the day ITV appered on Sky. It lasted a few weeks before being yanked off the Irish EPG, only becoming available (along with ITV 1, 2 and 4) when they became FTA.

Elmo wrote: »

I think that ITV may look at the possible leverage they have of getting money from Virgin and Sky for their 3 extra channels on the basic package, and I am sure a number of FreeView viewers may pay to get those extra channels. This money plus the additional advertising revenue maybe worth allot more than just Advertising.

Maybe, but again this would apply to the UK only, not ROI. Once ITV encrypts TV3 and others would have the leverage they need to prevent any deal to allow ITV on Sky Ireland. TV3 already prevent UTV from appearing on the Sky Ireland EPG as it is. Freeview might be an option for Pay TV, but where would that leave the Freesat model of FTA only? Losing ITV 2-4 would be a big loss.

Elmo wrote: »

Now that Digital is far more available ITV might think that it isn't such a risk.

It's a big risk they're taking, if the rumours turn out to be true - especially after the On/ITV Digital debacle. Encrytion is expensive, and the numbers have to add up: i.e. FTA avertising with a larger audience vs. Pay TV advertising and smaller audience.

Elmo

Pat Gleeson wrote: »

No they are not, they are added manually, which is related to my point. If ITV encrypts, there is no chance they would be made available to Ireland on Sky. Granada Plus was replaced by ITV3 the day ITV appered on Sky. It lasted a few weeks before being yanked off the Irish EPG, only becoming available (along with ITV 1, 2 and 4) when they became FTA.

ITV 1 - 4 in Ireland would depend on ITV's arrangements with Sky and UPC. ITV have a good relationship with TV3, you can see why they do not want to let go of that relationship it is worth far more to them then the advertising that they could earn from a small % of the Irish audience.

Maybe, but again this would apply to the UK only, not ROI. Once ITV encrypts TV3 and others would have the leverage they need to prevent any deal to allow ITV on Sky Ireland. TV3 already prevent UTV from appearing on the Sky Ireland EPG as it is. Freeview might be an option for Pay TV, but where would that leave the Freesat model of FTA only? Losing ITV 2-4 would be a big loss.

It is after all a UK television station not an Irish one. TV3 have already got that leverage. Both TV3 and Sky are aware that ITV would be damaging to both of them. TV3 due to the high number of ITV programming available on their channels and Sky due to their channels lack of quality, why do you think that no spin off PBS is available on Sky's EPG other than BBC 1, 2 and the Channel 4 set of channels? Sky see the popularity of Sky One in Ireland and really don't want to destroy that, why do you think it took them so long to give C6/3E 105 of course a similar channel to Sky 1 - 3 will be competition for them. TV3 and Sky are playing the game, they know that TV3 will satisifes most Irish peoples needs for ITV products and that BBC1, 2 and C4 channels satisfy their need for UK terrestrial TV. You can leave ITV out of the equation. If ITV does become encrypted I am guessing that Sky will be happy to collect Irish subs for their channels on their Entertainment package.

It's a big risk they're taking, if the rumours turn out to be true - especially after the On/ITV Digital debacle. Encrytion is expensive, and the numbers have to add up: i.e. FTA advertising with a larger audience vs. Pay TV advertising and smaller audience

They are looking at their numbers, ITV2 is now the most popular Digital TV channel in the UK. They know what advertising they get from that channel, but they may feel that a charge to people will bring them in extra revenue, while keeping up their audience share.

ITV2's audience might all pay for TV over those in FreeView Land. BARB breakdown audience figures on a per-platform basis.

lawhec

Elmo wrote: »

ITV 2 - 4 is that readily available on Irish Networks, UPC got rid of ITV3 a few years ago and TV3 certainly don't want them. Are ITV 1, 2, 3 and 4 on the Sky EPG?

I think that ITV may look at the possible leverage they have of getting money from Virgin and Sky for their 3 extra channels on the basic package, and I am sure a number of FreeView viewers may pay to get those extra channels. This money plus the additional advertising revenue maybe worth allot more than just Advertising.

Now that Digital is far more available ITV might think that it isn't such a risk.

Can you clarify if by a number of Freeview viewers willing to pay, that they would take out a satellite or cable subscription to pay for them?

Elmo

lawhec wrote: »

Can you clarify if by a number of Freeview viewers willing to pay, that they would take out a satellite or cable subscription to pay for them?

I am basing that on the assumption that ITV would look to keep their slots on DTT UK, AND that it would be part of a pay service on that platform.

Otherwise I would be also of the opinion that pay ITV 2 - 4 would be a far bigger risk if not available on the DTT platform as a pay service.

Pat Gleeson

Elmo wrote: »

They are looking at their numbers, ITV2 is now the most popular Digital TV channel in the UK.

Yes as an FTA Channel

Elmo wrote: »

They know what advertising they get from that channel, but they may feel that a charge to people will bring them in extra revenue, while keeping up their audience share.

They won't keep anywhere near the same audience share by going from a free to a pay TV channel. That's where the risk is - lose audience share, and hope subs more than pick up the slack.

You're absolutely right Elmo that these are UK issues. From an Irish point of view, it would be unfortunate to lose 3 of the better FTA channels. I personally cannot see how ITV can charge enough to offset the loss of advertising revenue.

Elmo

Pat Gleeson wrote: »

Yes as an FTA Channel



They won't keep anywhere near the same audience share by going from a free to a pay TV channel. That's where the risk is - lose audience share, and hope subs more than pick up the slack.

You're absolutely right Elmo that these are UK issues. From an Irish point of view, it would be unfortunate to lose 3 of the better FTA channels. I personally cannot see how ITV can charge enough to offset the loss of advertising revenue.

But we don't know the stats, if the majority of ITV's audience in the UK are pay TV customers then they may not lose that audience share, so they may be thinking why not charge after all Sky/Virgin are making money from our audience.

I amn't a fan of ITV 1 and switching over to see what a group of non-entities think of the X-factor or other non-entities in the jungle does really interest me. IMO the UKTV set of channels are just as good as ITV. I can do that with TV3 and 3E.

Surely from a UK point of view they to would be losing the better FTA services also, okay so we won't pay for them. But I am sure 3D is coming along at any moment (D - Drama, TV3's ITV3.)

Pat Gleeson

Elmo wrote: »

But we don't know the stats, if the majority of ITV's audience in the UK are pay TV customers then they may not lose that audience share, so they may be thinking why not charge after all Sky/Virgin are making money from our audience

These figures give a good idea of audience share:

Viewing Summary:

http://www.barb.co.uk/report/monthlyViewingSummaryOverview?_s=4

Muli-Channel Summary:

http://www.barb.co.uk/report/monthlyViewingSummary?_s=4

Multi Channel Development 1992 - Present:

http://www.barb.co.uk/facts/multiChannelDevelopment?_s=4

Elmo

Pat Gleeson wrote: »

These figures give a good idea of audience share:

Viewing Summary:

http://www.barb.co.uk/report/monthlyViewingSummaryOverview?_s=4

Muli-Channel Summary:

http://www.barb.co.uk/report/monthlyViewingSummary?_s=4

Multi Channel Development 1992 - Present:

http://www.barb.co.uk/facts/multiChannelDevelopment?_s=4

I was looking at those figure and was looking to see what the breakdown was: -

1. Just tell us what the 5 main terrestrial broadcaster get in relation to other TV, 60% V 40%
2. Gives us the same but with a break down of the 40%, of which ITV2 has 2.5% overall.
3. Is just about the development of multichannel in the UK. Of which nearly 50% is DTT, some cable and some Sat (what is the take up of FreeSat like?), and the numbers of people on Terrestrial has dropped significantly since DTT began in 2000 or we could say that Sat and Cable take up is now significant.

I am looking at it specifically from the point of view of audience share on DTT, PaySat and Cable. For example if ITV 2 was getting 10% of an audience on both Cable and Sat and only a 1% share on DTT and FreeSat it would make sense for them to look for additional money from pay TV.

What I am saying is that we do not know the make up of the ITV 2, 3 and 4 audience for all we know nobody with freeview watches these channels.

Pat Gleeson

The figures may change to be more representative of multi channel viewing:

http://www.digitalspy.co.uk/broadcasting/news/a188684/new-barb-system-to-bring-ratings-growth.html

Elmo

Pat Gleeson wrote: »

The figures may change to be more representative of multi channel viewing:

http://www.digitalspy.co.uk/broadcasting/news/a188684/new-barb-system-to-bring-ratings-growth.html

I think the term Multi Channel should have its day. Perhaps pay TV land should be introduced.

Mike 1972

I think the term Multi Channel should have its day. Perhaps pay TV land should be introduced.

Agreed

ITV2 is now the most popular Digital TV channel in the UK

With the exception of a handful of RSL's every TV station in the UK is now a digital TV station.

Elmo

Mike 1972 wrote: »

With the exception of a handful of RSL's every TV station in the UK is now a digital TV station.

So from now on Multichannel to be known as PayTV (or to be even more precise the platform i.e. Pay Sat, FTA Sat, FTA DTT, Pay DTT and Cable)

And digital TV know as Spin off or Extra channels or this new fangled ****.