PERSPECTIVE: ITV is cutting off its own nose with the Sky Digital rumpus

There’s yet more stamping of belligerent feet going on in the TV industry. This time it’s not about the News at Ten issue or the raising of fists over the ITV merger plans. This scuffle is one that has been simmering for the past year or so. It’s the thorny issue of ITV refusing to broadcast on Sky Digital services, with Sky recently brandishing BARB figures that show an erosion of ITV’s total viewing share in Sky Digital homes.

There’s yet more stamping of belligerent feet going on in the TV

industry. This time it’s not about the News at Ten issue or the raising

of fists over the ITV merger plans. This scuffle is one that has been

simmering for the past year or so. It’s the thorny issue of ITV refusing

to broadcast on Sky Digital services, with Sky recently brandishing BARB

figures that show an erosion of ITV’s total viewing share in Sky Digital

homes.



According to BARB data, ITV viewing in Sky Digital homes was 19.3 per

cent in June, compared with 20.6 per cent in March. With fingers quickly

punching away on calculators, Sky has come up with the forecast that if

ITV continues to withhold broadcasting on Sky Digital, its share of

peaktime national audience will fall to 37 per cent by the end of this

year, which would, of course, be 1.5 per cent below the 38.5 per cent

target ITV gave to advertisers at the start of the year.



It’s a potent argument, and no doubt forms one of the key planks in the

on-going negotiations between Sky and ITV. But I suspect that ITV is

aware that it will have to move on to Sky Digital before the year is

out, even if it is a decision fraught with conflict. ITV no doubt feels

that any money handed over to Sky to put ITV on the digital platform

will help boost the programming output for its rival. That must hurt.

But it is also aware that not having ITV on Sky Digital’s electronic

programme guide is a huge disadvantage, and although it is only a few

buttons away from being seen on analogue, it’s an unwanted barrier to

viewers.



ITV views the cost of transmitting through the 27 different regions on

Sky Digital as too high, so if the Independent Television Commission and

Sky could agree to it cutting down the number of transponders it could

broadcast through, there is a chance that this whole shouting match

could be resolved.



In the meantime, industry sources say that advertisers are growing

increasingly concerned about ITV not being present on Sky Digital

because of the negative impact on audiences. There is a sense that they

are victims caught in the crossfire of two broadcasters stubbornly

locking horns. The scenario throws up worrying questions about whether

consolidation will lead to high-profile disputes becoming more

prevalent.



Look at the fisticuffs between Time Warner and Disney in May when the

two failed to agree new transmission terms, leading to Time Warner

dropping transmission of the Disney-owned ABC channel.



It was a radical move and a poignant reminder of a media owner’s

power.



Media owners are wont to lose sight of the very people who justify their

existence - viewers and advertisers. Let’s hope Sky and ITV grow up and

make up.



anna.griffiths@haynet.com.



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