ITV Digital: Up S**t Creek

DMC

The highlights:

"ITV giants Carlton and Granada have publicly admitted their terrestrial digital venture, ITV is struggling for survival and have called in City accountants in a bid to avoid collapse.

They announced today they had hired Deloitte & Touche to try to renegotiate all ITV Digital's contracts at lower costs including the £315m Nationwide football league deal."

Full Article here...

http://media.guardian.co.uk/broadcast/story/0,7493,659038,00.html

ONireland

I hear this stuff all the time but nothing ever comes of it.

Don't forget that Sky Digital is loosing about twice as much money as ITV Digital is. The problem for Sky is that they cannot shut down Sky Digital because that is they're whole business.

To Granada and Carlton, ITV Digital is basically a little toy they play with whenever they're interested. I'm not worried though, the DTT platform will survive.

DMC

Oh, but this is serious, ONireland.... This is as grave as I have ever heard it.

Now, knowing football rights as I do, and knowing how Football League chairmen operate..... they are like hell going to renegotiate the contract. Telly to them is their bread and butter, what keeps the 72 league clubs afloat, but I think the heads of football are going to look silly when the TV rights are up again in 2 years time. Advertising will still be in a relative recession, TV companies will want to pay less (especially ITV) but will chairmen recognise that? Don't count on it. Don't forget they held football to ransom in the 80s by withholding TV contracts. Although those dark days wont occur again, you can be damn sure they will not settle for less!

Calling in management consultants is almost like calling in the receivers. That might be the next step.

As for Sky, yes they have their own troubles, but not as serious as ITV Digital's. BSkyB has expensively invested in Digital, but their revenue is far greater than ITV's, they have the backing of Murdoch plus they are not afraid to invest further, like getting Leo Kirch's operation out of trouble or getting F1 on PPV.

Sky has a platform that people stay with, unlike ITV Digital, who as we know, has a very high churn rate.

The DTT platform may survive, but I'm pretty sure, sadly, that ITV Digital wont. I hope I'm wrong....

byte

It probably would've helped ITV Digital if the transmitters were giving out a strong enough signal. AFAIK, the digital transmissions are much lower power than analogue transmissions making its coverage reach pretty low.

chernobyl

Originally posted by irishbyte
It probably would've helped ITV Digital if the transmitters were giving out a strong enough signal.

and if they had some original channel content instead of re transmitting a select version of Sky Digital.

The PS2 broadband network could be a saving grace for ITV.

DMC

Originally posted by irishbyte
It probably would've helped ITV Digital if the transmitters were giving out a strong enough signal. AFAIK, the digital transmissions are much lower power than analogue transmissions making its coverage reach pretty low.

If it had ¾ of the power that analogue Divis has, I would've had it, ahead of Sky Digital. You cant blame ITV for that, granted. But that has stifled its growth.

ONireland

The talk about Digital signals being broadcast at 10% the power of analogue is all meaningless. It's like comparing the size of a petrol engine to a diesel one.

Digiboxes have more sensitive tuners than analogue TV sets because they are designed to work with lower signals.

Of course, increasing the power output would help, but then so would having a decent aerial.

Also, it is actually a mith that ITV Digital loose 25% of the customers year on year. A lot of that 25% are on pre-paid, return their box and get a new pre-paid. ITV Digital's real churn is more likely to be around 15%.

ITV Digital has invested heavily in DTT infrastructure. The British government has really screwed ONdigital/ITV Digital. They have basically got an independant company to set up the DTT infrastructure for them, write new software, get interactive systems working... ...what to they do in return. Nothing!

Also, I doubt very much that there will be any attempts to close ITV Digital before the launch of the Pace boxes and the ITV Digital Pay as you go service. Then there is the matter of the two-way MHEG software that will enadle the modem being launched soon. ITV Digital still has a lot of cards up its Monkey's T-shirt yet.

Also, the vast majority of people get quite good DTT coverage in Northern Ireland. Anyone I speak to who has ITV Digital think it's great. They don't claim it's perfect, they don't claim to use it day and night. Like most people, the occassionally watch it and think it's grand.

Yeap, and i have one of those "ondigital" boxes-so i guess I'm one of their numbers:D
Oh this pseudo Uk aka Kilanerin North wexford is great:D shur we even have BT cellnet:D

On another note-I see that ITV Digital are advertising heavily on HTV and I presume the other regions at the moment-thats something they weren't famed for doing.
Cutting down on advertising your product is not a good idea.
Presumably the team of City accountants pointed that out.
The advertising was ongoing this lunchtime,so they must think theres life in the old dog yet

My own personal viewpoint is that ITV digital is not a re transmission of a "select version of Sky digital"

Sky is both a platform provider as well as a Broadcaster.
Essentially ITV is the same via Carlton and Granada.
Sky do not own the majority of "family pack" channels they broadcast and neither does ITV Digital.
It is not right to say either platform could claim to have "originality" in the channels they choose to Broadcast. A Commercial outfit must pick the popular ones.

mm

triple-play

The problem with Sky is that if ITV Digital closes down many of those subs will go to Sky (as cable does not pass all the homes). This increases Sky's power relative to ntl and Telewest and diminishes the bargaining power of channels when negotiating carraige deals. These channels will get less revenue from Sky who could soon have a monopolistic share of the market. As 80% of these channels revenue comes from the platform (only 20% from advertising revenue) many will go out of business. Sky can then buy up the channels it believes have value creating a 'total platform' where Sky owns all the content and the platform.

This is not a good scenario for the punter as Sky will be able to increase sub tariffs while increasing the cost of content for other platform operators -putting them under increasing financial pressure. And it won't take too much to put ntl and telewest out of business -not to mention Chorus in Ireland.

Did you know that ntl has twice the debt of Enron?

apiou

Yeh, and their shares are down from US$ 128 to US $0.18 - glad i have none - that would make me rather ill

But