ONdigital rebrand faces ITV shareholder opposition

LONDON - Carlton Communications and Granada Media have run into opposition from ITV's smaller shareholders about plans to rebrand their joint venture pay-TV service ONdigital as ITV Digital.

SMG and Ulster Television, which broadcast ITV in central and northern Scotland and Northern Ireland, have objected to Carlton and Granada's use of the ITV brand in their plan to restructure the network.

The restructure will see ONdigital integrated with a new premium pay-TV sports channel ITV Sport and exisiting entertainment channel ITV 2.

It is understood that the two small companies have demanded compensation from the larger companies about their proposed changes to the network. SMG, however, is said to have rejected Carlton and Granada's offer to date and walked away from talks.

If an agreement can not be reached, ONdigital will not be able to rebrand as ITV Digital in Scotland.

Granada and Carlton own nine of the 14 ITV franchises in the UK. They could go ahead with their proposals without consent from the other ITV companies, but they would not be able to promote ONdigital in the regions where they do not own the franchise.