ITV plots UKTV bid to boost digital presence

ITV plc is plotting a bid for the UKTV portfolio of digital television channels in a move designed to shore up its stake in the digital TV future.

Although ITV has yet to make a formal bid, it is understood the move is under serious consideration. It would strengthen ITV's presence on the digital platforms whose growth has contributed to ITV1's decline.

UKTV operates as a joint venture between Telewest's content arm, Flextech TV, and the BBC, and is made up of nine digital channels, including UKTV Gold and UKTV History, as well as several time-shifted versions. The sales house IDS, under investigation by Flextech (see page 4), holds the airtime sales contract for UKTV.

A disposal of Telewest's content business, which also includes the wholly owned Flextech channels Bravo and Living, could accelerate its long-awaited merger with the rival cable company ntl. The two companies have recently emerged from major debt restructuring programmes.

ITV has also been refocusing its business, having sold off its non-core TV assets, such as its publishing arm, Carlton Books, in order to concentrate on its UK broadcasting interests.

Any takeover would be subject to approval by the Competition Commission and could incur the wrath of media agencies, fearful that ITV would abuse its position as the market leader to conditionally sell UKTV.

Separately, ITV is also planning to launch ITV4, a digital channel with a schedule that will be constructed primarily around game-shows.

The proposed channel could include interactive quizzes and game-shows that would provide the company with an additional revenue stream and would become the fifth member of the ITV family of channels.