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Tuesday, 30 April, 2002, 11:16 GMT 12:16 UK
ITV Digital: What next?
The pay-TV service ITV Digital faces being broken up after its administrators announced that they have failed to sell the debt-ridden company.
The Independent Television Commission (ITC) has said it will now revoke ITV Digital's licence and offer it for tender.
The move will spell financial trouble for dozens of Football League clubs, who rely on a broadcasting rights deal with the company for £178.5m of income.
Existing viewers will still be able to watch free-to-air digital terrestrial channels such as BBC Choice, BBC News 24, BBC4, ITV2 and S4C.
However, they will lose paid-for services such as Sky Sports and ITV movie channels.
ITV Digital went into administration last month owing £178.5m to the Football League in television broadcasting rights.
Is there hope for the future? What effect will this have on Football League Clubs?
Professor Tom Cannon of the Manchester Business School answered your questions on this matter in a LIVE interactive forum.
This Talking Point has now closed. Read a selection of your comments below.
Jane Beckett, London, UK
I have had ITV Digital from the start. I have been more than happy with the service and have never had a problem with the reception or hardware, and found the cost for the channels quite reasonable. That said, I will now take out a SKY subscription as cable is not available to me.
I'm a football supporter myself, but if the football league clubs are greedy enough to spend all the money before the revenue stream is proven then they only have themselves to blame. Its not like ITV Digital have been providing this funding for ten years! As for the technology it's a godsend for those of us who can't have dishes outside our properties, but if I had the choice it would never have been ITV Digital in its present form. The whole platform needs to be advanced to make it work. Maybe Microsoft might like to do something instead of just talking about interactive TV.
So, The Football League kicks television in the nuts once again. But this time it doesn't just affect football viewers, it affects everyone. I have no interest in watching football on ITV digital; if I want to watch football, I'll go to the pub, and watch it with everybody else. The way it affects me is that I will no longer be able to select the channels that I pay for (in the case of SKY, 14 pounds per month, just for two film channels; I am prepared to endure this), UK GOLD etc. According to the terms of my lease, I am not allowed an external antenna.
I cant wait until ITV digital go under as a former employee released in early February. It was clear that the company was going under then. The management couldn't take hold of the situation and the staff didn't have a clue what was going to happen.
It's about time reality hit home. The footballers have been paid for too much for far too long. I for one will be celebrating when all football is taken off TV.
Digital TV - unloved, unwanted, unmourned.
Digital TV is a confidence trick by the government to raise a hidden tax by selling off redundant bandwidth. The effect of this can be seen by the devastating effect of the enormous cost of the 3G licences. Furthermore the technology is not at a level whereby users can get a level of service comparable with the present analogue service.
The cheaper programs are often the funniest...even if they're meant to be serious...I love the wide choice of channels and programs available with digital television.
Tim, Denver, USA
Digital TV in this country is a poor quality, technically inferior product compared to HDTV in the USA or indeed analogue here. If they go bust then the government's idea to force us to Digital is skippered. I'm glad. The clubs should also take some of the blame for demanding too much money to overpay their players with
I think it's a real shame that ITV digital has gone under solely due to football. OK ITV Digital doesn't have as many choices for the same price as Sky or Cable, but I have no option of having either installed. I live on an estate comprising only listed buildings. This means no digging up the road to install a cable line nor any external modifications can be made. I'll be cancelling my DD on Monday 29th and see what happens. . . . .
We have had ITV Digital for about 2 1/2 years, we are not allowed a satellite dish (as it is a listed building) and there is no cable company as yet in the area. My mother and many like her will be the losers, she cannot go out and TV at least gives her enjoyment in the daytime when she is on her own.
Well, I have had ITV digital for about 2 years now. The only thing I've ever liked about it is the monkey. The reception is really bad...I think I might give Sky a go.
Neil, Larkhall, Scotland
What's all the fuss about, give it to the BBC to run, all future TVs will have terrestrial digital tuners instead of analogue anyway and there is no reason why the BBC shouldn't have there own satellite to use. When ITV digital finishes will I need a BBC card?
I had OnDigital (as it was formally known) from launch and got rid of it within two weeks, The picture constantly froze and the sound kept popping. It's perfectly simple - the technology was and is flawed. I have Sky Digital and have never once had the slightest problem with it. ITV Digital were flogging a dead horse from day one. I have no sympathy for the football clubs - they should have known better.
Everybody is talking about the football clubs going out of business but nobody seems to have mentioned the ITV Digital staff and retailers who may also lose jobs. I am surprised that the government haven't done more after all the millions that must have been spent in researching digital terrestrial television. They seem to have washed their hands of it.
I wonder how many Sky supporters will be cheering in a couple of years time? I remember what happened when Sky took over BSB - Suddenly there's no competition and Mr Murdoch's rack started to work overtime. Prices regularly racked up, free services were charged for, then the ultimate insult of starting new services on a new satellite so you had to buy new kit. Two hundred channels and nothing to watch is great value.
Ben, Mansfield, UK
I recently had contact with ITV digital after my bag was stolen on a train and items of personal identification were used by a third party to subscribe to ITV digital in my name and my address. I had no idea that there was a problem with piracy and that the set top boxes were hot property. I did not know how the service worked! After receiving several demands for payment I contacted them to explain that I had never subscribed and was not interested in doing so and that there was some mistake during a telephone call to their customer services (one of many) the representative informed me that they were getting a huge number of fraudulent applications in other peoples' names simply because it was possible to walk out of a shop with one of their decoders and use it with a pirate card.
If the government is so obsessed with us having digital TV, why doesn't it force the cable companies to provide coverage to the whole country and not selected areas? I live in an area with no access to Cable TV, no Broadband for Internet, and no ITVD reception is possible . I would love a cable then I could have all these things. Mind you I had sky and cancelled it, and I am happy with the analogue for my viewing now. As for the footballers, - go out and get a proper job.
Ed Karten, UK
Well, a big thanks to the football league. Feel free to destroy ITV Digital in your never-ending greed. The Football League is going to have to face the facts about football in this country - there are too many teams. The best result of this fiasco is to close the ailing clubs, or at least turn them into feeder teams for the Premiership, as in baseball.
Was one of the first to sign on for OnDigital, guess I will be the last to leave! I will turn the light off on my way out! And do I get my ?200 I paid for the box back?
If they paid these footballers their true worth (10 pounds a week), the clubs would be fine. Let's face it - if you pay your staff too much you go under.
Isn't this a case of the Football League killing the Golden Goose? They have cut off their guaranteed income stream completely to spite their overdrafts. They accepted the (over) bid and will now have to pay the consequences. Surely they could have negotiated a guaranteed continuation of rights past the original franchise finish date, passing this modified income on to their creditors.
Did it take more than a quick spreadsheet to work out that they would never get their money back from football? I also do believe parent companies should be held to task - otherwise its all to easy for them to skip their real responsibilities
Iain, Oxford, UK
ITV Digital going bust could be just the tonic for DTT. Now that the market has been seeded with STBs (that no one is going to give back) the government should re-allocate the multiplexes on a much simpler scheme of one per existing analogue broadcaster. They should be limited to no more than 3 channels per multiplex to improve picture quality and allow space for all that interactive stuff we keep hearing about. Sky should be allowed a multiplex and the BBC also given the remaining one if they promise to support all the latest developments in DVB and conditional access control should be handed over to TV Licensing to avoid the gatekeeper problem of Sky on Astra. That way we can all enjoy quality programming, most of which would be free.
I wanted to get a set-top box to watch BBC4 but I was told that coverage in my area was 'uncertain'. And I live in Berkshire, not the Shetlands! ITVD was never a fully national channel like SKY and the analogue channels and if it could not be accessed by people in the most populous (and prosperous) part of the UK then it is not surprising it went under.
Phil Hughes, England
We terminated our direct debit for ITV digital when the company went into administration and I am now being hounded for arrears, only what they call arrears is a monthly subscription paid in advance. They will get paid and have been assured of that in writing several times but only after I have had the benefit of the service. As it transpires it looks like they shall stop broadcasting before my months subscription is due so they shall only get paid pro rata.
I don't think anyone should be paid 5k a week, except maybe someone who saves lives, such as a surgeon or similar. The money some footballers get is obscene in the extreme. I am also sick of the "adverts" on BBC TV for themselves and upcoming programmes. Could it be that we are being eased into feeling comfortable with adverts on BBC, so it won't be such a shock when they go commercial? God forbid. ITV used to have two advert breaks in a one hour programme and now it's three. Any more and I'll switch off, whether it's digital or not!
ITVD is a poor second rate service at best. I live next to a transmitter, so I get the strongest possible signal strength. No box freezes for me, but a poor blocky picture nevertheless! ITVD simply didn't have the bandwidth required to support that many channels. Anyone noticed the quality's gone up since some of the channels disappeared? I have... but they're still nowhere near as good as analogue!
On the ITV Digital website there is a Press Release dated 13th Feb 2002 entitled "ITV Digital on track". For a company to be on the point of liquidation a mere two months later surely smacks of impropriety on someone's part?
Why don't you realise you're simply pawns in an evocative corporate game? ITV and its digital project is all about money for old rope. Dodgy output but sure enough people will happily pay up for 'entertainment'.
ITV Digital and the Football League. Two overblown pompous self important companies felled in the same blow. Bargain.
Why did we let those who run our main commercial channel (but by no means the best!!) ruin the UK's lead in digital terrestrial broadcasting?
I'm surprised they haven't blamed the pirates yet!
We have had ITV Digital for about a year now after switching from analogue cable. Apart from some initial reception problems which were fixed by an aerial upgrade, it has worked perfectly. OK, so it's not as sophisticated as Sky but does anyone remember what Sky was like during its first few years? Ultimately, there are a lot of people who just have analogue TVs & videos. Unless we are all expected to have satellite dishes, something like ITV Digital will come along again.
I am terribly upset by the collapse of ITV Digital. I have been renting a set top box ever since On Digital started. It was not ideal, with the picture freezing all the time, but there was no option, as the managing agents of my flat would not allow the installation of a satellite dish. I contacted all the cable companies; they say there are no plans to lay cable in my area in the foreseeable future. I'm passionate about cricket and look set to miss all the ODI's between England/Sri Lanka/India, and all the county championships. In the past Channel 4 has had the irritating habit of interrupting Test Match Cricket to show racing, but the match would continue on Film 4. I will miss huge chunks of the cricket this summer if ITV Digital fails. I could weep.
There has to be viable competition to Sky
As an ITV digital subscriber who will find it difficult to move to either cable or satellite, I regret the passing of the company. However, in the long term, the big loser in this I think will be the UK government. Having now become used to a range of channels beyond the analogue group I will quickly move, though with some difficulty, to cable. The result will be that I will not move back to DTTV if another company replaces ITV Digital due to the effort needed to move to cable. There is only a limited pool of adopters of new technologies such as DTTV at any given time. I suspect that a large proportion of us will now adopt other digital technologies, making the Government's proposed national move to DTTV significantly more difficult. With the early adopters gone, it will be harder to re-launch a technology that will have the stigma of having failed and few remaining devotees.
Poor technology - I live approximately 10 miles from the main Mendip transmitter and have unrestricted view of virtually the whole mast, yet a high gain aerial, broadband amplifier and mains filter still couldn't ensure trouble-free reception. Programme choice - a poor selection of programmes (my interest is films) with annoying Digital substitutions of major Sky Premier films. We have persevered with this service for two and a half years in the hope that it would get better - it didn't!
ITV Digital has unfortunately been a bit of a curate's egg. On the plus side: easy to install, improved competition in an anti-competitive market, and a full range of pay TV services. Unfortunately the negatives have been its undoing: variable reception quality, poor business sense and inconsistent customer service (ranging from excellent to poor depending on who answered on phone).
The ITV digital service is great, and I would have thought that if the government are so keen to switch over to digital TV assisting in some way to keep this company and its technology in business. Not all of us want or are able to have satellite dishes attached to their property. Using existing aerials works.
It seems to me that the failure of ITV Digital is down to two main factors. 1 - bad management decisions. For example, rebranding OnDigital, they should have kept the name but put more effort into adding better channels to attract customers. 2. Greed. The football clubs are greedy for money and were only too glad to go for the money on offer from ITVD.
If the Football League had been quite certain that their contract was only with ITV Digital they may have been more inclined to take the offered part-payment instead of pushing ITV Digital into receivership, thus depriving subscribers of their service. I hope they get *nothing* from Carlton/Granada - that is all they deserve for their actions. Besides, Tessa Jowell has already started talking about giving football clubs financial support - a ludicrous idea given the pressures on the public purse and one which is grossly unfair to ITV Digital's former subscribers who are now left high and dry.
One of the reasons why ITV Digital has failed is that the vast majority of the public think that you need to pay a subscription to receive the service, for which ITV and Sky Digital has not helped or promoted (only the BBC has). I bought Sky Digital only to receive the free channels and because there's more choice of these free channels. What the successor to ITV digital needs to do is to market these free channels and rely less on expensive subscription channels and football deals.
Throughout this crisis much has been made about the football clubs who will suffer from the demise of ITV digital. I am now one of the customers who is about to lose 1 years subscription which I paid in full in good faith. Yet I have not heard the same amount of coverage about us, the customers, being on the losing side. I believe this demonstrates where focus is place in this country and it is not on customer service.
ITV digital was a poor substitute for Sky/NTL/C&W and that is why it suffered a high churn rate and was unable to grow subscribers. Simply put the public is too intelligent to pay for an inferior product. With bad signal strength and restricted availability of channels in many areas I fail to see how the Government Minister Tessa Jowell can say: "The hard truth is that this is a failure of a company, not a technology," she told MPs. Ms Jowell should ask herself why there is such a significant hardcore of households not prepared to purchase new equipment to switch to digital, and consider what government investment is needed on infrastructure before the licence is offered for sale again.
Does it really matter who provides the service to our homes? 90% of the channels provided are utter rubbish anyway. I subscribe to Sky Digital. The overall service provided is ok, but I'm sick of watching repeated programs every day. Perhaps the only sure way of securing the future of digital television is to invest in high quality, well produced programmes.
Mark Stratford, Wareham, Dorset
If this stops the Government forcing digital on many unwilling people then good. Why should we be forced to swap our perfectly serviceable analogue TVs simply to get equipment capable of receiving even more worthless channels filled with rubbish?
The main reason for ITVD's demise is because of lower football divisions players demanding near premier league wages. The lesson will have to be learnt that this isn't possible. ITVD put all it's egg's in one basket & failed because of that. The only reason I took ITVD myself was for the Champions League games & I'm now left wondering what will happen to them.
I live in a leasehold property and as such, I am not allowed to erect a satellite dish on the building. In addition, there are no cable services available in my area either. ITV-Digital (then On-Digital) was my only hope of a better choice of viewing. But now that will be stopped, I have no way of watching additional channels as I find the analogue channels too dull. Even the free digital channels will not be worth buying my ITV box for. Perhaps leaving all their eggs in one basket (the football deal) was its downfall. Lesson learned for the next operator.
Digital Television should mean High Definition television as it does in the United States, not cheepo cheepo television as it does in Europe today. The technology exists to give us pictures in our homes with 5 times as much picture information as we have today, but European broadcasters, led by money grabbing types like Rupert Murdoch, are not interested in providing this higher quality imagery. I don't watch movies on TV anymore: I have been spoilt by watching them as DVDs on a projector with surround sound. With HD (blu-ray) DVDs only about a year or two away, a more serious question to be asked is what the future of terrestrial television is at all if Digital TV in Europe means only more of the same?
As a banker and a football fan, I expect that a large number of football league clubs will over the next few months deliberately put themselves into administration. This does not however mean that they will go out of business. It will allow the administrator to cancel all the players' contracts and then re-employ the desired players on packages that affordable in the current environment.
I like TV more than football and I hope they manage to replace ITV Digital with something substantial soon. Of course Carlton and Granada shouldn't pay the Football Clubs anything. The point of a limited company is that the shareholders are not liable for anything other than the value of their shares. The clubs were greedy, they agreed to enter into a contract with the highest bidder without really looking into whether they could pay and then spent millions on the basis of it. The football bubble has burst and poor TV has been injured in the explosion.
So we're going to be given the opportunity to buy the set boxes... what if we don't want them, who will be picking up the tab for the returns, and what will happen to an enormous pile of previously owned set top boxes? It'll be interesting to see what happens to all those who passed on their unwanted boxes at car boot sales. Unfortunately, the card pirates will soon find some other system to fiddle.
The picture froze on a regular basis and the sound would disappear and then resume with a loud crack. This despite having an OnDigital approved aerial installed. These problems aren't uncommon so the technology is flawed. We ditched it within two weeks.
Guy Chapman, UK
Granada and Carlton should be forced to pay the remaining sponsorship money. When they backed ITV Digital, they acted solely in the belief that they could reap huge financial benefits from football supporters. Now that things have not gone according to plan, their reluctance to accept financial responsibility shows the contempt they clearly have for football. It is just another example of big business putting money before anything else.
Surely the general problem causing the poor take up of digital TV is that there is no separation between the content providers and the network providers. To receive all digital channels available one would have had to subscribe to Sky, cable and ITV Digital with 3 sets of equipment, cables, receivers, etc... The customer should be able to choose the most convenient means of delivery (network provider) and subscribe to whatever programmes (from content providers) they wish to pay for. Unbundled services would be much easier to understand, and those who just wish to receive the new free to air digital channels, such as BBC Four, would only need to buy the network connection. Why doesn't the BBC act as the network provider and charge a higher fee digital TV licence?
The loss of ITV Digital will be mourned by those of us who move house regularly. As a doctor, my job requires regular house moves, sometimes at six month intervals. Sky is expensive to install/uninstall and obviously cable is not an option.
Simon Watkins, Wales, UK
We subscribed to ITV digital at the end of 2001. We had problems with the service, but even when we didn't there was not much to watch. We had prepaid for the year and it looks like we are going to lose the remaining time (and hence money).
This on the whole does not bode well for the Digital TV industry in the UK. The plan to close the analogue service in 2010 may be hit, but the ability to view the free to air channels (which are not free but are included in the license fee) may just keep it edging forward.
I have no sympathy for the football clubs. They are as arrogant off the pitch as they are on. They were offered a smaller amount which the rejected as they are greedy and are holding out for their £500m. How many clubs will have gone under by the time it goes to court? I have been a subscriber for 4 months and will miss E4. It took 7 phone calls to change my channel selection but apart from a few freezes I have been satisfied with the service. I hope that someone buys the licence soon as I do not want my garden dug up by NTL or to have a dish fitted to my house. I was also able to choose individual channels instead of a package containing channels you don't want. Long live ITV Digital
The way to make digital TV pay is very simple - staring the government and the ITC in the face. Let city TV stations take over the frequencies (both analogue and digital)let them show their own home town football and provide a real community service. We run a TV station just for Portsmouth and will soon open in Southampton. Its the only TV service in the country that has a dialogue with its viewers and best of all - its free. Simple.
I'm very sad to see the demise of ITV-Digital - it was a long way short of perfect - but at least it wasn't owned by the "dirty digger" - I'm not in a cabled town, so it's either Murdoch's Sky (I can't bring myself to do it) or live with the free to view channels and rent a few DVD's. I shall miss Discovery and E4 though.
I'm glad ITV Digital has gone bust. I've had the system for four months now and had nothing but problems.
I had the ON Digital pre-paid option since it was launched in 1998. Since buying it I had to pay a £40 fee for an aerial upgrade and even then sometimes the channels were a bit hit and miss with the box freezing quite often. Within six months of having ON Digital I decided to get Sky and get hundreds more channels. I think that ITV Digital's downfall was due to the lack of viewing choice and reliability. Had that not been an issue I think it would have had a good future.
The unfortunate demise of ITV Digital is going to affect a very large number of people and it looks as if the subscribers (who are very unlikely to get their money back) will effectively be paying the price of this failure. ITV Digital looked like a good option when I subscribed originally; it allowed you to mix and match channels much more than Sky or the cable companies. My biggest complaint is really about subscription television in general. If we want to increase the choice we have available to us, we are effectively forced to subscribe to a 'package' of channels half of which we don't want and, to put it bluntly are mostly rubbish. When this country changed from the old 405 line VHF television system to the 625 line UHF system the whole change over was done without the need for thousands of subscriptions supplied set-top boxes and the public ended up with a good quality national television service (both public service and commercial) I feel that there would be less of a problem now had the changeover to digital been organised and financed in a similar way.
Wonder if they're going to sell off the monkeys cheaply...my girlfriend wants one.
To Papa, UK: You can have my ITV Digital monkey for a hundred quid. Now there's greed for ya!
I cancelled my subscription yesterday - is this why they went bust?
Strange how the demise of "lower league" football clubs is now seen as a result of the collapse of ITV Digital. Is it not the case that most clubs below Division 1 are not in fact viable businesses in their own right and only exist as a "fantasy" of some businessmen who likes to say "I own a football club..." There are far too many so-called professional clubs chasing what is now a dwindling pot of cash. The Football League need to step back and have a radical overhaul of the structure of the game below Division 1. Could start by having Divisions 2, 3 and the conference structured to play on a "regional" basis, at least then the paying public would not have to travel so extensively, and the majority of games would then become "local derbies".
As a former subscriber to this what can only be described a "two bit" service. I hope they do go under. In this day and age where quality and price are vital to people the some what amateurish service they offer is not acceptable.
Steve Smith, Norwich, England
Why would anyone buy an ONdigital box when there are over 200 channels, I bought the PACE box when ONdigital was launched. But the picture is continually freezing and the sound brakes up. I was paying over £30 for ONdigital, I signed up with BskyB, and it cost me £50 to fit the dish, and I pay £2 more than ONdigital and am totally satisfied.
Both ITV digital and Sky digital are well overpriced. ?37 per month for the complete package is ridiculous. E4, Sky One and Discovery are the best basic channels although the kids love CBBC/CBeebies and the Cartoon Network. Half the channels close down at some point through the night and the choice is pretty grim on the ones that don't. Even CBBC/CBeebies repeat about 4 times each day and stop at 7pm (not so good if the kids are up during the night). I would only take Premier (Movies/Sports) channels if they were more reasonable priced (e.g. ?7 each, 2 for ?12, 3 for ?15?). The prices they are charging I could buy 2 or 3 decent DVDs each month instead of the trash they are showing. I know people who are considering cancelling their Sky subscriptions because of the cost and quality of programmes. If anyone takes over they should give us decent programmes to watch, less repeats and run all channels 24 hours a day. The kids would like the Disney Channels to be added to!!
From a commercial point of view, the Football League and ITVD share responsibility for the financial mess they are in. Much like banks lending customers money that they know they can't pay back, the League should have been more circumspect about who they did business with. ITVD are clearly not blameless either.
Nick Brown, UK
I have NTL (cable), this has over 100 channels. It's just like Sky without the stupid dish. ITV digital has made its own mess it should of never accepted these offers if they knew they had to pay back the football suppliers.
As we had 9 (!!) failed attempts to have our dish re-fitted after moving house, we decided to risk ITVDigital knowing that the signal may not be strong enough. Well, I like so many others have been 110% impressed with their service. I note that a few people have reservations about the content and the service. Rubbish! ITVD offer all the main channels that Sky offer, and without the repulsive dish and the expense. ?144 a year for all the channels? I seem to recall paying ?30 per month for that service with Sky. Long Live ITVD. Premiership Footballers, welcome to the real world.
I have no sympathy at all with the football clubs. They managed to survive fine in the past without the ridiculous sums paid for TV rights, and their bleating and refusal to accept ITV Digital's settlement offers, shows all too plainly their greed and arrogance.
I have had ITV Digital for 8 months, and I have been impressed with the service, especially Carlton Cinema, which is vastly superior to any of the Sky Cinema channels (and it is not even available on the Sky platform!). When you do not live in a cable TV supplied area, and have no desire for an ugly dish on your property, ITV Digital was the only choice. In addition, if you have a widescreen set, analogue transmissions are useless, as you end up with a distorted, or foreshortened picture. Only Digital platforms broadcast in true widescreen. I really hope a buyer comes along and continues to provide the service. One question remains. What happens to purchasers of DVB Integrated TV Sets? These were heralded as the future of broadcasting, but if the ITV Digital platform goes, who will continue to pay for Digital Terrestrial transmission of the Free to Air programmes like BBC 4 & ITV 2?
25 Apr 02 | Business
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