The media buying agency claims that the rate at which Freeview decoders are selling since they became available last year, suggests that 1.5 million households could have the digital terrestrial service by the end of 2003.
The winter 2003 On TV report states: “These boxes have been flying out of the shops at the rate of equivalent to one and a half million a year.”
“Our own forecasts seem to echo a City consensus that a quarter of all homes could have them within five years. That’s about as many homes as currently have satellite dishes. Freeview decoders will probably be installed as standard in TV sets within four years.”
Zenith estimates that ITV1 currently gets around 29% share of viewing in terrestrial homes. However, this falls to 25% in Freeview homes, suggesting that the platform’s offering of over 30 free-to-air channels is tempting viewers away from the UK’s largest commercial broadcaster in Freeview homes.
The report suggests that in these circumstances, ITV2 will become increasingly important as its main rivals, Sky One, UK Gold and E4, are not available on the Freeview platform. It predicts: “ITV2 is likely to be the largest commercial multichannel on Freeview. Nothing like enough to make up for ITV1’a loss of share, but compared to a Sky Home, very much a bigger fish in a smaller pond.”
Zenith points out that Freeview is the lesser of two evils for ITV, which has to compete with over 200 channels in Sky Digital homes, rather than the 30 currently available on Freeview. It states: “You can take the fatalistic view and assume that as all homes will eventually be digital anyway, then lots of Freeview homes is a best-worse case. But it’s going to make a difference to ITV1’s share come what may.”
However, Zenith emphasises that it’s not all bad news for ITV as signs of advertising recovery emerge from the US with two pro-ITV prongs: firstly new FMCG money, which is destined for ITV and secondly, the BBC has “emptied its strategic silos.”
The report says that ITV still has plenty to offer and accuses the Corporation of “front-end bungling” and damage to the licence-payer, predicting that the Corporation will come a “few entertaining croppers” in the year ahead.
