ITV Digital up for sale

The League says many of its clubs face oblivion

Attempts to keep ITV Digital's head above water by renegotiating its deals with the Football League and others have failed.

The administrators from Deloitte & Touche of the stricken digital terrestrial broadcaster are now hoping to sell the operation off as a going concern.

"This is a course of action we had anticipated... It does not, however, alter the League's determination to receive full value for the £178.5m it is owed by Carlton and Granada

David Burns
Football League chief executive

They acknowledged the need to move quickly, and said they expected to make an announcement about whether a buyer is likely to be found for the whole organisation by Thursday.

For the moment subscribers' screens should not go dark, as Deloitte & Touche promised that services would continue as normal.

Big money

ITV Digital went into administration last month owing £178.5m to the Football League.

Talks between the two sides were held last week at the request of administrators, but it is believed that no progress was made.

The hope remains that, while ITV Digital has racked up heavy losses, its 1.26 million subscribers will prompt another broadcaster to buy its assets.

But while the aim is now to sell off the company as a going concern, few think that will be possible.

With the enterprise costing £1m a day, Carlton and Granada, ITV Digital's owners, are keen to offload it and may have to pay someone to take it off their hands.

Analysts have warned that most of the potential buyout candidates are either doing nicely as they are, or up to their ears in their own debt problems.

"BSkyB has ruled itself out, and the cable companies are hardly in a position to make an acquisition," said Graham Lovelace, head of the media consultancy Lovelacemedia.

Bad news all round

In the meantime, no-one is coming out of the affair with any good news to celebrate.

Carlton and Granada are likely to escape demands from creditors including the League.

But their handling of the crisis - particularly their refusal to back ITV Digital's promises to football clubs - means that they could find it more difficult to do business in the sporting world in the future.

The government, too, will be disappointed.

It had hoped ITV Digital's through-the-aerial offering would encourage digital takeup, allowing it to sell off the potentially lucrative frequencies used by analogue TV.

It will now have to take up the task of persuading people to switch - probably only to free-to-air channels rather than paid-for ones - by itself.

Dark day for football?

As for the clubs in the Football League, heavy-handed briefing early on in the crisis is thought to have limited the options for compromise.

Now, it seems, there is a serious possibility that some clubs could go to the wall.

"This is a course of action we had anticipated," said the League's chief executive, David Burns.

"It does not, however, alter the League's determination to receive full value for the £178.5m it is owed by Carlton and Granada."

And as for viewers, services may continue for a few days or weeks, but paid-for services including entertainment channels such as Sky One and sports channels will probably go black in the very near future unless a quick sale can be found.

They will be left with free channels such as BBC4, ITV2 and S4C.

Technological problems

ITV Digital, which broadcasts a digital signal through conventional TV antennae, failed to attract the anticipated number of subscribers, and was hit by a sharp downturn in advertising spending last year.

Audiences for its expensive Football League broadcasts failed to meet expectations.

ITV Digital was also dogged by patchy reception in some regions, and lost revenue due to the wide availability of pirated subscription cards.