ITV v pay TV operators: the battle over "retransmission fees" heats up

The ongoing battle between commercial public service broadcasters and pay TV platforms took a twist this past week, with Sky and ITV vigorously defending their positions and even the European Commission taking sides on the debate over who should pay what for carriage on digital TV platforms.

The European Commission has told the Government that the arrangement which allows Virgin Media to carry services including ITV and Channel 4 for free is an infringement of EU rules, reports The Daily Telegraph.

This supports the position that ITV has taken in recent months; the broadcaster confirming that it doesn't want to give away its main channel to either Virgin Media or Sky, and is seeking commercial terms for carriage, as it does for ITV2, 3 and 4. Instead of Sky charging ITV for services, ITV says it should be the other way around.

In September, Adam Crozier, Chief Executive at ITV, said: “Introducing retransmission fees would have clear benefits to the UK creative industries and the wider economy - as well as to viewers right across the UK - by enabling PSBs to continue to invest in the original programming people love to watch."

Last week, Sky's Director of Corporate Affairs, Graham McWilliam blogged about the issue, stating: "More than two months have passed since ITV launched its lobbying effort with a report highlighting the impact of the system of fees that exists in the US market. Despite its enthusiasm for the US comparison, we have heard nothing at all from ITV on the practical details of how such a scheme would be implemented in the UK. For example, we still don’t know whether ITV, like Channel 4, is in favour of additional regulation through the introduction of a fee set by Ofcom." 

Channel 4 also objects to the charges levied by Sky for carriage on the pay TV platform. While the BBC and ITV received a reduction in their carriage fees following a new agreement with Sky earlier this year, there has been no such indication of any deal between Channel 4 and Sky.

Last month, Channel 5's new owner Viacom joined the debate. Chief Executive Phillippe Dauman reportedly spoke to the Culture Secretary about the charges.

While all commercial broadcasters appear to want a switch with regards payments for carriage on pay TV platforms, it's unlikely that it would affect the transmission of the main channels on Freeview - the cornerstone underpinning ITV, Channel 4 and Channel 5 - along with STV, UTV and S4C is their respective Channel 3, 4 and 5 licences for terrestrial distribution via Freeview. ITV, STV, UTV and Channel 5's licences were recently renewed (effective 1st January 2015) by the Department for Culture, Media and Sport (DCMS). As part of their licences, the channels have to make their standard definition services available for free, with the Channel 3 companies along with Channel 4 operating their own digital multiplex Digital 3 and 4, transmitting the terrestrial signal for free to viewer's homes. Pay TV operators might object to this apparent anomaly if they find they are forced to pay to carry ITV, Channel 4 and 5.

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  1. ITV doesn't deserve to be paid anything. Its technology seems to be out of the arc. It is still incapable of broadcasting in Dolby Digital 5.1 despite saying 5 years ago that it was investigating the problem.


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