UBS: “ITV should switch to subscription model”

Analyst UBS says that ITV should consider changing to a subscription model to boost revenues.

According to a report in today’s Independent, Daniel Kerven, analyst at UBS, said there was little upside even after a recovery and “given ongoing structural pressures, we have suggested that it should consider migrating to a subscription model”.

A survey carried out by GfK NOP for UBS found that 24% of non-pay TV homes would be more likely to subscribe if ITV 2, 3 and 4 were only available on Sky and Virgin, growing to 40% when ITV1 was included.

UBS said the survey showed a “wider consumer acceptance of pay-TV” with subscriptions expected to hit up to 68%, up from 60% in previous surveys.

Last week, Sky revealed that it is gaining subscribers at its fastest rate for five years, taking its total to 9.4 million (see Sky reports 6% ad revenue decline).

The satellite broadcaster announced pre-tax profits of £456 million for the year to the end of June, up from £60 million last year.