ITV suggests merger with main rivals

ITV is putting pressure on the Government to consider radical solutions to the TV funding crisis with one proposal being the creation of a new "super broadcaster" through a merger of ITV with Channel 4 and Five.

The broadcaster is thought to have outlined the plan to the Government along with other options including turning Channel 4 into a "pure" public service broadcaster that no longer carries advertising.

ITV, which is expected to unveil a fall in its profits next week when it reveals its annual results for 2008, has been keen to outline alternatives to plans to solve Channel 4's funding shortfall through a tie-up with BBC Worldwide or a merger with Five.

However, its proposals, which would increase its dominance of the TV ad market, would provoke strong reactions from advertisers and rival commercial broadcasting groups such as BSkyB.

Earlier this week, Lord Carter, the communications minister, admitted there were other broadcasters beyond Five interested in merging with Channel 4. Carter is spearheading the Government's "Digital Britain" project, which is looking for a solution to a funding shortfall in commercial television.

ITV, which is led by the chairman and chief executive, Sir Michael Grade, has already received large concessions from Ofcom over relaxation of its public-service obligations regarding the provision of local news. However, it is pushing for even greater concessions in areas such as contract rights renewal and seems keen to emphasise to the Government the pressures it is under.