ITC PROPOSALS AIM TO SPEED DIGITAL UPTAKE

The ITC have set out the financial terms that will be offered to the remaining seven ITV licensees, if they choose to apply to renew their analogue television licence for the ten-year period beginning April 1 this year.
Out of the seven licensees (Border, Central, Channel, Grampian, Granada, LWT and Scottish) Granada, who have indicated their intention to apply for renewal, were judged the biggest winners when regulators renewed ITV licences at rates lower than market expectations.
In 2002 Granada will pay £4.1 million for their Granada Licence and 15 per cent of qualifying advertising revenues. For their LWT licence they will pay £4.9 million up front and 17 per cent of analogue revenues. The current cash sum in 2001 is £11 million for Granada and £9 million for the London based station LWT.
Chairman of the ITC Sir Robin Biggam (pictured) said: “The terms are derived from a realistic assessment of the value of these licences in an increasingly competitive market.
“With this renewal, all tender payment terms have been put on a consistent basis and all licensees can expect their payments to fall significantly over the next ten years as digital penetration increases and the analogue service accounts for a diminishing part of their revenue.”
By cutting their payments to the Treasury, analysts predict that the ITC’s proposed new terms will benefit Granada to the tune of £100 million - Granada paid out £350 million in 2000 and this is expected to decrease to around £250 million in 2002.
In an effort to speed the expansion of digital television, the licence terms have been reduced dramatically in an effort to realise the government’s aim to make Britain the leader in digital television. The lower rates assume that Granada, Carlton and Scottish Media Group will all further commit to a digital future.
However, the plan to switch off the analogue signal within five to ten years has been criticised as ‘fatally flawed’ by the Consumers’ Association who revealed that 32 per cent of people who don’t currently have digital television said they will never get it. (AMcE)