ITV executives were queuing up last week to proclaim that they
would be investing the money granted to them by the Independent
Television Commission’s licence renewal ruling in more original
programming. Well, let’s hope those pledges turn out to be more than hot
air - it would be easy for some of the smaller rebates to get swallowed
up in ongoing digital investment or, dare one say it, find a snug little
home deep inside the pockets of shareholders.
In truth, though, there won’t be much for these shareholders to snaffle.
The pounds 90 million that will wing its way to ITV is not much more
than the money the network currently receives from the soon-to-expire
Channel 4 funding formula. Last year, in fact, Channel 4 stumped up more
or less pounds 90 million. This year, its payments will come closer to
pounds 60 million. And next year, it won’t pay anything. So, looked at
in this light, most of the extra cash isn’t extra at all.
But, of course, this ignores the fact that the new money will be
distributed in entirely iniquitous proportions befitting the crazy
closed-bid system under which the licences were handed out in the first
place. So, within ITV, there will be winners and losers.
The most obvious winner is GMTV, which might actually be able to start
acting like a proper TV company at last. In this case, investment in
programming is the only option.
Both Yorkshire Tyne Tees and HTV will also be celebrating the estimated
pounds 24.5 million and pounds 16.5 million lopped off their respective
But what of the so-called losers? Well, in this extremely odd little
game, they can walk away if they don’t like the result. So Central,
rather than pay pounds 17.5 million more to the Treasury each year, has
unsurprisingly elected to carry on as before. Meanwhile, five of the 16
licensees, including Granada, LWT and STV, didn’t even bother to reapply
for their licences this time around. They know when they’re on to a good
But the problem for them will come when the next opportunities for
licence renewal come up - in May 1999 and then, finally, in September
2000. Will the ITC be more lenient or will it get tougher? It’s an
interesting gamble, but one which - if it goes to the wire - could cost
these cocksure punters their licences. If they fail to agree terms at
all, other bidders will come into the reckoning in a formal tender
Some licence-holders may feel relaxed about this. After all, they’ve
played the auction game once and won hands down, so what’s to stop them
pulling it off again? Carlton may very well think it can get away with
another pounds 2,000 bid for the Central licence. And if it tries and
wins, good luck to it. In the meantime, however, the uncertainty could
seriously undermine the stability of the ITV network.
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