ITV Digital defies sceptics

ITV Digital has confounded sceptics, who have for months predicted the service's demise, by attracting almost 50% more subscribers than some media experts had predicted.

The broadcaster, formerly ONdigital, added 82,000 subscribers in the July to September quarter, statements from its backers Granada and Carlton Communications said.

The figure, which compared with City forecasts of 55-65,000, took ITV Digital's total subscriber base to 1.217 million by the end of last month, more than a third higher than a year before.

And it followed continued reports that Granada and Carlton were looking to quit the business, which needs an estimated 1.7 million viewers to break even.

On Monday, shares in Granada and Carlton rose over fresh reports of a pull-out.

And the Financial Times on Thursday reported that Europe's broadcaster, RTL, has refused to invest in Carlton and Granada until they ditch ITV Digital.

Targets hit

Granada and Carlton credited the revival in ITV Digital's fortunes largest to its rebranding, and the launch of the ITV Sport Channel, which attracted 138,400 subscribers within seven weeks of going on air.

"[Thursday's data] demonstrate the strength that the ITV brand has added to ITV Digital," ITV chief executive Stuart Prebble said.

"We have rebranded the business, launched ITV Sport Channel, exceeded subscriber targets, improved on our churn target and achieved all this at a lower than projected cost," he added.

Subscriber growth has been supported by a "real breakthrough" in the commercial market, with businesses including Center Parcs holiday centres and military retailer NAAFI switching from rival feeds to ITV Digital.

And an advertising campaign, based around a TV-viewing monkey, has been a "real success", ITV Digital managing director Rob Fyfe said.

"We expect to build our subscriber base on target during the next quarter and beyond".

The business has also trimmed outgoings through measures including an across-the-board pay freeze.

And it is from next month to introduce price rises which will take the monthly cost of the basic ITV Digital package to £12 a month.

Interactive options

Future service developments include the launch later this autumn of an interactive version of the Who Wants to be a Millionaire quiz show, which will allow viewers to answer questions along with the programme.

A comprehensive gaming site will also be launched, as will an Abbey National banking service.

In the City, Granada shares stood 2p higher at 130p, and Carlton stock 1½p lower at 190p, in late morning trade.