Page last updated at 09:37 GMT, Thursday, 25 February 2010

X-Factor battle looming for STV

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STV says media companies have been badly hit by the recession

Profits at STV have more than halved in the last year to £5.5m.

The broadcaster said 2009 had seen the deepest advertising recession ever experienced by the group.

STV, which is currently in a legal dispute with ITV, has raised the prospect of fresh action over spin-off programmes like the Xtra-Factor.

The Scottish media group said it had written to ITV raising its concerns and if it did not get a satisfactory response it would claim damages.

STV said it was viewing 2010 with some caution as the decline in advertising had been so severe that profits went down despite "unprecedented" cost reductions.

'Strong and competitive'

Rob Woodward, the group's chief executive officer said: "We have transformed our business to ensure that STV remains strong and competitive going forward.

"We are confident that as we go into 2010, against a backdrop of improved trading conditions, STV will continue to deliver against its ambitions."

STV said as a shareholder of the ITV Network, it invested in building brands like the X-Factor, from which ITV developed spin-off programmes like the Xtra-Factor.

However, it claimed that ITV then scheduled these programmes "prejudicially and aggressively" on other ITV channels in which STV had no economic interest.

STV has written to ITV raising some of these issues and said if it did not get a satisfactory response, then it would have no choice but to begin legal proceedings.

Ongoing battles

The two broadcasters are already taking legal action against each other.

In November, STV launched an action against the ITV network in a dispute over new media rights.

STV claims it could be owed up to £12m after ITV entered into commercial agreements without obtaining consent from STV Central and STV North.

ITV had previously launched a £20m legal claim against STV over the Scottish broadcaster's move to drop shows such as The Bill.

STV is also pursuing a claim, estimated at up to £16m, for revenue it says it should have received under its advertising sales agreement with ITV.

In a statement, the Scottish group said although both companies had agreed some of the amounts, there were still issues outstanding.

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