YOOMEDIA DISCUSSION FORUM!!

ITV down on terrestrial but up on digital

The UK's biggest commercial broadcaster ITV has warned that ad revenues on its terrestrial channel will be down 12.5% in 2006 but that multichannel revenues will rise 40%. The company is also taking its ITV Local broadband TV service nationwide in 2007.

The projections came today as ITV issued a trading update ahead of the close of its full financial year on December 31. The company said that the figures were in line with expectations, although the strong performance of ITV digital channels exceeded these.

While net ad revenues from ITV1 will dip 12.5%, those from ITV2, ITV3 and ITV4 will be up 40%, meaning that the company's target of £150m (US$295m) from these channels has been achieved a full year ahead of expectations.

"2006 trading remains in line with current market expectations and, while the airtime sales environment remains challenging, our digital channels continue to perform strongly," said ITV interim chief executive John Cresswell.

ITV is also seeing strong growth in its consumer division, which is responsible for growing non-TV ad revenues through activities in online, mobile and through acquisitions such as the Friends Reunited school reunion web business.

ITV Consumer is also steering the company's broadband TV trial, designed to transform the broadcaster from a regional player into one that's truly local and able to source ad revenues at this level as well.

ITV Local has been undergoing trials on the south coast of England for over a year now, with internet TV specialist Narrowstep, and the broadcaster is now sufficiently convinced of its potential that a nationwide roll-out will kick off early next year.

"ITV Local has been a huge success in the Meridian region during the trial phase and we are preparing to launch the service in London and Central in early 2007," said ITV Consumer commercial director, Mike Fegan.

Meanwhile, back in the company's core television business, the programming budget will be maintained at its present £1bn mark through 2007, including the £815m spent on flagship terrestrial ITV1 and the £100m on digital channels plus morning strand GMTV.

Cresswell also extended his welcome to Michael Grade, the former BBC chairman, who will take over as ITV chairman and chief executive on January 8 with hopes high that he'll be able to turn around the company's flagging fortunes.

The trading update revealed that ITV1's share of commercial impacts has dropped 10.4% to 33.3% during 2006, but a stronger autumn schedule has helped improve performance in the second half. ITV1's peaktime adult audience share has averaged 29% since the start of the season, compared to a year-to-date figure of 27.3%.

Jonathan Webdale
19 Dec 2006
© C21 Media 2006

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