Government Spurns ITV’s Emergency Legislation Demand

19 October 2001

Despite enlisting the chairman of the Independent Television Commission as propagandist for their merger campaign [WAMN: 18-Oct-01], Carlton Communications and Granada Media, the ruling duo of Britain's ITV Network, were roundly rebuffed on Thursday by the Department of Culture, Media and Sport.

Responding to a call by the ITC’s Sir Robin Biggam for emergency legislation to sweep away antitrust barriers to a merger between the TV titans, a spokesperson for the department dismissed this as “neither practical nor desirable”. The government, she said, “needs to get the legislation on media ownership right so that it stands the test of time in a rapidly changing marketplace”.

“The proposals on media ownership will be brought forward as a single, coherent package in the forthcoming communications bill. It is neither practical nor desirable to deal with this issue in a piecemeal fashion.”

Nor is the mooted merger flavour of the month with Britain's major advertisers, whose representative body, the Incorporated Society of British Advertisers, today (Friday) writes to regulators and the government stating its opposition to the formation of a single unified ITV company.

Says ISBA: “Even the current advertising slowdown does not represent a credible opportunity to press for further consolidation, which would lead to a clear breach of competition regulation. ITV still controls around 56% of the UK TV advertising market.”

As to ITV’s claim that merger would safeguard against takeover by foreign predators: “We do not believe merger would materially increase ITV's immunity to such a takeover. While its larger size and cost might sift out most potential buyers, we believe it would also make it more attractive to those who can afford it.”

Of the fiscal woes besetting ITV Digital, a joint venture between Carlton and Granada, ISBA was equally unsympathetic: “ITV Digital's owners embarked on its development as a commercial venture. We do not believe the failure, thus far, to create a viable business should be a reason for the government to reward it with extraordinary legislation.”

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