Unveiling first-half results, commercial TV group Granada Media announced it has been in talks with utility companies about taking a stake in ONdigital – the terrestrial digital TV service it co-owns with Carlton Communications – in order to ease financial strain following falls in ad income.
Announcing a 5.4% year-on-year drop in net ad revenue to £486 million – slightly better than forecasts [WAMN: 13-Jun-01] – Granada posted pre-tax losses of £69m. This includes a £121m loss from digital operations and £60m in exceptional items – without which profits were £112m, down some 10% on last year.
There was no immediate end in sight to the ad slowdown stated executive chairman Charles Allen: “We do not rule out bringing in another strategic partner for ITV Digital [as Ondigital is to be rebranded] and it could be from outside the media industry. We have spoken to utility companies.”
Gas, electricity and telecoms suppliers are eager to expand their operations, hoping to strengthen their customer relationships by offering multiple services in a single package.
However, utilities are not the only investment targets for ONdigital – Carlton chief executive Gerry Murphy revealed that BSkyB, the satellite digital TV provider, and British Telecom could also be potential partners.
News source: Financial Times; Press release