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TV Articles - The Future Of ITV

The Future Of ITV - 3 Become 2
Written: 14th July 2000

Bastille Day for France, and decision day for ITV.  today it was announced that Carlton Communications were given consent to merge with United News & Media, a decision that shapes the future of ITV even more than was thought possible 10 years ago. 

Today's ruling by Trade Secretary Stephen Byers shows how ITV needs to "get it's act together" to compete on the world stage against super-giant organisations such as the Time Warner, News International and European giant RTL.  The go-ahead by Stephen Byers was to allow Carlton & UN&M to merge, however this doesn't necessarily mean that it is over for Granada Media Group.  Stephen Byers announced that Granada were also allowed to submit a challenge to either Carlton or UN&M to merge with either two of those organisations.

Certain conditions have been attached however in order to keep the companies within the new audience share restrictions.  If Carlton & UN&M were to merge, then Meridian Television (UN&M) would have to be sold off by Carlton.  Granada would be most likely to purchase this.  However, if Granada were to acquire either Carlton or UN&M, then Granada would have to release one of its own acquisitions for sale (Border Television is not included in GMG's acquisitions as it is still owned by its original mergee). This is to be HTV, which has been subsequently purchased by Carlton.

The share markets are currently predicting what they feel of the report, showing that shareholders feel that Granada are getting the best out of today's report.  Carlton's shares fell 6.78 percent, UN&M shares fell 1.45 percent and GMG's shares rose 5.21 percent.  The final decisions of the potential mergers lies with the shareholders of the three companies, and now it seem inevitable that ITV will become at least two major powers.  Next up will be a revisal of the Communications Bill, where it is expected that the Government will drop the 15% audience threshold, therefore giving way to a single ITV company.

It had also emerged that European television giant RTL are in the running for a possible bid for United News & Media.  The news came through evaluation of the report.  It is believed that RTL would like to enter the UK market substantially, through the overall control of Channel 5.  RTL currently own 65% of Channel 5, the other 35% by United News & Media.  If RTL were to take over the whole of  Channel 5, they would have to own HTV, Anglia and Meridian initially.  There are also chances from this that RTL would sell its least profitable companies (HTV & Anglia) to open bidders (Carlton & GMG).  Industry sources have been quoted as saying that RTL are "readying" themselves to make an offer to United News & Media.  Industry advisors also predict that TF1 and Italy's Mediaset as also being potential entrants to the UK  market.  This adds pressure to an increasing debate on who will finally get ITV as a whole.

Carlton and UN&M today announced their plans following the approval by Stephen Byers, they say no.  In a joint statement, it emerged that Carlton and UN&M were worried about the effect of losing Meridian would have to its business plans.  Therefore, Carlton cannot merge with UN&M with this "reduction to the benefits of shareholders".  This, according to reports now leaves the entire title race open to Granada Media Group, who are yet to submit their options.  They look set to merge with one group, and then take over the third, making ITV in England & Wales owned by one company. UN&M have alleged to "put themselves up for sale" through the desperate jump into a joint-ownership in an increasingly competitive market.  Therefore, the top European broadcasters, namely TF1 and RTL are looking more set than ever to merge with UN&M.

My personal opinion of the matter is that it is about time that the companies of ITV got its act together, without government restrictions, to continue running and broadcasting the best television in the world.  What I would like to see (and I think many people will agree with me) is that Granada should bid for the takeover of Carlton.  Granada brought back the "Tyne Tees" tag, so why can't our saviors bring back "Westcountry" and more importantly "Carlton"!  However if Granada were to bid and win Carlton, Granada would HAVE TO release LWT on a government restriction.  LWT would then effectively be taken by United News & Media.

On the other hand, the more logical outcome of this report would be that Carlton & UN&M would merge, leaving Meridian for Granada.  This then creates main "competition" between Carlton & Granada for the overall single ITV.

Whatever happens from this date, it will be more competitive with each stage that ITV goes along to complete its task as being a single company.  And whatever happens, presentation and regional branding will be a thing of the past.

UPDATE - 28th July 2000

It has finally happened, Granada has take the lead, and bought-out United News & Media's ITV operations in a package deal worth 1.75billion.  This package also includes United's television production and International distribution businesses.  UN&M however do keep their 35% share of Channel 5 as it wasn't part of the sale.

With restrictions set in by the Government, Granada now have to sell one of their 7 ITV franchises, this is reported by Granada to be HTV's dual region.  The value of this sale is likely to be worth about 350million. It is also though that Granada will also sell the 5% stake in GMTV as well.  Both of these assets are most likely to be captured by Carlton.

FURTHER Update - 24th October 2000

The third stage of the single ITV saga has now been completed, seeing Carlton purchase HTV from Granada.  In addition to the 170million price tag, Carlton offered their 20% stake in Meridian to Granada.  This has now been completed leaving three main companies left in ITV, Carlton, Granada and SMG, with Channel and Ulster being "independent".

10 years ago saw the first light of the franchise rounds which lead us to this current state of ownership and takeovers, a distant vision of the future when ITV started back in 1955.  Nowadays, it seems the norm for one television company to take over another, until one day, there will only one type of television, lets just hope it isn't too dominant.

People say "regionalism in ITV is dead".  Looking at what has been happening over the past 5 years that seems true.  The one thing that ITV had over its main competition was its "regional character", and now that seems as distance as the word "independent" in ITV.

What for the future from this?  With more potential corporate takeovers and more "joining forces" to create one single ITV, where will regionalism come back into ITV?  No-one knows the answer just yet, but I feel that ITV was once independent, was once regional, and was once great.

All articles produced on this page are solely reported by Mark Snowdon, no copying, reproduction or further use of these articles shall be made without the permission of Mark Snowdon.

If you have any comments to make upon the articles upon this site, please feel free to e-mail me. Letters may be produced upon this site in future editions.

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