ITV Offers BBC £50m Incentive To Abandon Digital Bid

ITV has told the BBC that it could save £50m of licence fee payers money if it scraps its bid for the digital terrestrial TV (DTT) licences made available following the collapse of ITV Digital (see Administrators Confirm ITV Digital Sale) and joins the rival ITV and Channel 4 coalition.

ITV and Channel 4, which make up the Digital Terrestrial Alliance (see ITV And Channel 4 Confirm Multiplex Application), are understood to have written to the BBC last night claiming that they could reduce the cost of broadcasting the BBC’s licence fee funded channels by £4.4m per year.

Under its current scheme the BBC would pay broadcast supplier Crown Castle £3.8 million each year to broadcast four of its free-to-air channels. However, ITV and Channel 4 have offered the BBC carriage at £2.7m per annum. The £1.1m saving per channel gives a total saving of £50m over the 12-year life of the DTT licences.

The BBC is understood to have dismissed the offer as unworkable and will wait along with the other three bidders (see Four Bidders Emerge For Digital Terrestrial Licences) for the ITC to award the licences on 4 July.

The BBC had originally been in talks with ITV and Channel 4 with a view to creating a consortium to bid for the digital terrestrial licences. However, it has been reported that negotiations collapsed after the group failed to agree on how the licences would be divided up.

BBC: 020 8743 8000 www.bbc.co.uk Channel Four: 020 7396 4444 www.channel4.com ITV: 020 7843 8000 www.itv.com

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