Granada and Carlton to align ITV and ONdigital

25th April 2001

Carlton Communications Plc and Granada plc today announced proposals for a new partnership to align ITV and ONdigital - creating an integrated free-to-air, pay television and online media business.


  • Harnessing one of the most powerful brands in the UK, the new ITV will include ITV, ITV2, a new ITV Sport Channel to launch in August, ONdigital, which will be renamed ITV Digital and, which launches later this year.
  • Aligning Carlton and Granada's ITV assets will allow more effective management and is expected to yield total cost efficiencies for the two companies together of £20m per annum in the second full year.
  • Stuart Prebble will be appointed Chief Executive of ITV with overall responsibility for ITV free-to-air and pay channels and
  • Rob Fyfe will be appointed Managing Director of ITV Digital.
  • David Liddiment will continue to be ITV Director of Programmes and, as ITV Director of Channels, will assume wider editorial responsibility for ITV digital channels.

Charles Allen, Chairman of Granada plc, said:

This is the most fundamental change in British broadcasting since the launch of multi-channel television. Granada and Carlton have forged a new partnership in ITV, the UK's most popular television channel, and are now bringing together the tremendous brand strength of ITV with the UK's digital terrestrial broadcasting platform.

Michael Green, Chairman of Carlton Communications Plc, said:

ITV will now leapfrog the BBC and Sky with this new partnership. A combined free-to-air and pay television audience of 50 million viewers a week offered entertainment, the Internet and e-commerce is a world first.

New ITV Structure

Under these proposals, ITV will operate three businesses - ITV Channels, ITV Digital and, supported by common service functions.

ITV Channels

ITV Channels will encompass ITV and ITV's digital channels. A new premium pay sports channel, ITV Sport Channel, will launch in August. It will combine ITV and ONdigital sports rights, including 330 football matches, of which more than 150 will be live. It will have UEFA Champions League, Nationwide Football League and Worthington Cup games as well as linking to 40 live Premier League matches and ATP tennis. ITV will continue to offer the best free-to-air sport and entertainment content.

ITV Digital

ONdigital will be re-branded ITV Digital and become ITV's pay television platform, leveraging the strength of the ITV brand. Having achieved 1 million subscribers faster than any comparable platform, ONdigital announced today that it added a net 75,000 subscribers in the quarter to 31st March 2001, giving it a total subscriber base of 1.087 million. Its current churn rate of 22 per cent per annum is lower than all other pay television operators at an equivalent point from launch.

ITV Digital's strategy is to improve consumer loyalty, increase revenue per subscriber and reduce acquisition costs. This strategy will be delivered through:

  • Rapidly improving geographic coverage, which will reach 70 per cent ofthe UK within the next three months. Coverage will be further enhanced by the announcement this week that the government will facilitate improvements to the quality of digital reception by doubling the power of the signal strength, initially at 8 of the key transmitters serving many of the major urban areas; and
  • Enhancing content with additional services, including a compellingsports offering as the launch of the ITV Sport Channel adds to the channel line-up and new pay per view and interactive services are introduced.

This will enable ITV Digital to build a loyal and established customer base as the business continues to grow towards planned break-even in 2003/4 with 1.7 million subscribers. will create a unified online home for all ITV entertainment and interactivity. It will integrate, as well as Granada and Carlton's ITV online properties, such as, and Taken together, these existing Carlton and Granada services already generate over 20 million page impressions per month and will create one of the UK's top ten entertainment sites. will also feature online properties like Who Wants to be a Millionaire? games for solo and multiple players, national tournaments and synchronised "live" games. Who Wants to be a Millionaire? online has achieved some 45 million page impressions in the first three weeks since launch.

Online events, celebrity chats, audio and video streaming, listings information, e-mail, SMS messaging, chat rooms, consumer polls and a search facility are also planned as part of Through an enhanced range of information, entertainment and interactive services, extensive cross promotion and with access to almost 50 million viewers, expects to become one of the UK's overall top ten favourite sites.

Commenting on today's announcement, Gerry Murphy, Chief Executive of Carlton Communications, said:

This will give more choice to consumers, allow more creative opportunities for producers, and provide better value for advertisers - the potential here is huge.

Steve Morrison, Chief Executive of Granada plc, said:

This agreement will fuel the growth and evolution of ITV and unlock the full potential of our assets in the digital age. ITV's strong content brands, like Coronation Street, Popstars, Survivor and Who Wants to be a Millionaire? will be exploited across all distribution channels, making ITV the home of entertainment for everyone, everywhere.

Stuart Prebble, Chief Executive of ITV, said:

This is great news for viewers, advertisers and for the future of digital television in the UK. ITV will continue to offer viewers the best free-to-air sport and entertainment and now a clear and trusted brand to lead them to the digital and online world.
For advertisers, ITV channels will offer more commercial impacts and greater opportunities to buy advertising and sponsorship packages across free-to-air, pay and online platforms.
I'm delighted to have the opportunity to lead ITV, one of the UK's most powerful consumer brands, at the most exciting time in its development.

Notes to Editors:

  1. The ownership and management of regional ITV licences and the Networking Arrangements are unaffected by today's announcement.
  2. Michael Green, Chairman of Carlton Communications, and Charles Allen, Chairman of Granada, will jointly chair their shared ITV interests with a Board that will include Steve Morrison, Chief Executive of Granada, Gerry Murphy, Chief Executive of Carlton Communications, Stuart Prebble, Chief Executive of ITV, David Liddiment, ITV Director of Programmes and Rob Fyfe, Managing Director of ITV Digital.
  3. The production, distribution and airtime sales operations of Carlton and Granada will not be affected by the announcement.
  4. The Independent Television Commission has been consulted on the proposals and is not aware of any significant regulatory issues being raised.
  5. The annual savings of around £20 million per annum are expected to result in a one off cash cost of around £10 million. Of the 1.087 million total subscribers at the end of March 2001, 33,000 have signed contracts but are yet to activate their smartcards or have been installed without subscriptions, mainly in dealers, for demonstration purposes. This figure is 4,000 down on the equivalent figure at December 2000.
  6. These proposals have been discussed with the other ITV licencees who are supportive of them in principle, and detailed terms will be progressed following this announcement.
  7. Biographies:

    Stuart Prebble - Chief Executive, ITV

    Stuart Prebble, Chief Executive of ONdigital since July 1999, was previously Managing Director of Channels and Interactive Media at Granada. Before that he was CEO of Granada Sky Broadcasting. He began his career as a BBC graduate trainee and then reporter for BBC TV, before moving to Granada to work as a presenter and then as a producer on the World In Action series. He was promoted to Deputy Editor in 1987, and then Editor in 1988. After a period as Head of Regional Programmes, he was appointed as Granada Head of Factual Programmes in 1992. In 1993 he moved to the newly formed ITV Network as Controller of Network Factual Programmes.

    Rob Fyfe - Managing Director, ITV Digital

    Rob Fyfe joined ONdigital in September 1999, following an international career in Sales, Marketing and Operations. Before ONdigital, Rob was at Telecom New Zealand where he headed the Consumer Division responsible for sales, marketing, customer service and operations in support of all residential and retail customers. Prior to Telecom New Zealand Rob had a number of roles with National Australia Bank, including Regional General Manager Customer Services for the Asia Pacific Region, Group General Manager for Marketing, Distribution & Electronic Banking and Group General Manager Business Re-engineering. During this period Rob had a close involvement with National Australia Bank's interests in the UK and Ireland.

    David Liddiment - ITV Director of Programmes

    David Liddiment joined ITV Network as Director of Programmes in September 1997 with responsibility for the commissioning and scheduling of all network output. Having started his career in advertising, he joined Granada in 1975 as a promotions scriptwriter, subsequently working as a researcher, director, producer and investigative journalist across the whole range of programmes. He was appointed Executive Producer of Children's Programmes in 1986 and in 1987 he assumed responsibility for Coronation Street, Britain's longest running TV drama.

    David was appointed Head of Entertainment in January 1988 and Director of Programmes in 1992. He joined the BBC in October 1993 as Head of Entertainment Group. He then joined LWT in August 1995 as Deputy Managing Director and Director of Programmes, and in September 1996 he was appointed Managing Director of Granada UK Broadcasting. He also served as a director on the ITV Council.

  8. Carlton Communications Plc is one of the UK's leading commercial broadcasters, with businesses in free television, pay television, advertising sales, pay television, content, interactive media and the internet. It has the biggest English speaking film library outside Hollywood and is one of Europe's largest rights distributors - selling its 18,000 hour programme catalogue to over 200 countries worldwide. Carlton is a leading producer of interactive content - producing the first interactive advert on ITV for Unilever. It produces programming for all the main UK television channels.
  9. Granada plc is one of Europe's leading content creators and broadcasters. It produces and broadcasts over 9,000 hours of original programming every year, providing 1,500 hours of programming to the ITV Network and 4,500 hours for other UK and international channels. It has production businesses in five countries and sells its programmes and formats to over 120 countries worldwide. Granada is also building up a range of channels, broadband and online businesses, with partners including Boots, Manchester United FC, Liverpool FC and Arsenal FC.