United Kingdom : National TV market description - Update 2008
Audience trends |
Corporate developments |
Legal issues |
Digital transition |
Technological developments, new services and new channels |
Sources |
Audience trends
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In 2007, the public service channel BBC 1 was still the service most watched by all UK households (22% audience share), followed by ITV1 (19.2%). The phenomenon of the erosion of the incumbent channels' market share is thus continuing at the same time as the increase in the penetration of multichannel offerings. The audience shares of BBC2, Channel 4 and five are also in decline. Partly in order to compensate for the drop in the audiences of their main channels, BBC, ITV Channel 4 and five have enlarged their portfolios of digital channels, with Channel 4 launching More4 to complement E4 and Film4 and ITV launching ITV4, CITV and ITV Play after ITV2 and ITV3. Finally, in October 2006, five launched five Life (now renamed fiver) and five US. The BBC, ITV and Channel 4 have also launched time-shifted versions of several of their channels. (Audience data source: Eurodata TV Worldwide / BARB / TNS UK) |
Corporate developments |
The cable sector completed its consolidation in 2006 with the NTL/Telewest merger. The new entity, which has more than 3 million subscribers, then bought Virgin Mobile, thus creating a new group, Virgin Media, which controls more than 90% of the cable market and has launched the country's first "quadruple play" service (television, broadband internet, fixed-line and mobile telephony). In response to a request made in March 2007 by BT, Setanta, Top Up TV, and Virgin Media, Ofcom decided to open a new investigation into the pay-TV market, which comprises the television-on-demand and subscription services available on all platforms, i.e. cable, digital terrestrial, satellite and ADSL TV. The investigation relates to the characteristics of the market, in particular control over content, ownership of distribution platforms, retail subscriber bases and vertical integration. Another consequence of the increased competition between different platforms was a conflict that erupted in March 2007 between BSkyB and Virgin Media concerning the amount of the fees charged for the transmission of the BSkyB channels. As no agreement was reached on this, BSkyB withdrew its channels Sky News, Sky One and Sky Sports News from the Virgin Media platform. The UK's major competition authority, the Competition Commission, decided in December 2007 that BSkyB's 17.9% holding in ITV Plc, the UK's major commercial broadcaster, amounted to a merger situation and had resulted in a substantial lessening of competition within the UK market for all television services. As a result the Secretary of State for Business and Enterprise has ordered the shareholding to be reduced to a level below 7.5%. |
Legal issues |
In January 2007, the government approved a new financial agreement on the BBC's licence fee. The level of this funding is fixed several years in advance by the government, which has just announced the latest such agreement, which provides for an amount significantly below that requested by the BBC. As a result, the price of the annual colour television licence will rise from its current level of GBP 131.50 (EUR 199) to GBP 151.50 (EUR 229) in 2012. Over the year 2007, the conduct of competitions using premium rate telephone services has been a source of major scandals in British broadcasting. In May 2008, Ofcom has fined ITV GBP 5,675,000 (EUR 8 597 625) for breaches of the Ofcom Programme Code in connection with such services. Relevant provisions of the Code include those requiring that factual programmes must not mislead the viewer, that competitions should be conducted fairly and that the broadcaster must retain control of premium rate service arrangements. |
Digital transition |
The United Kingdom has one of the highest digital penetration rates in Europe. According to estimates by the British regulatory authority (Ofcom), in March 2008 it amounted to 87.1% of all households, which means that the main TV set in 22.2 million homes is connected to digital equipment. Analogue broadcasting in the United Kingdom is to be switched off in regional stages between 2008 and 2012. The first major stage in the transition will begin in the Border TV region in 2008. At the end of 2006, Ofcom confirmed the details of licence conditions to ensure that coverage by digital terrestrial television is achieved after switchover, to a degree equivalent to that of current analogue television coverage. In July 2008, Ofcom issued a call for applications for the allocation of two HD licences on the B multiplex, with a third HD licence HD reserved for the BBC. In March 2008, the breakdown for the methods of reception of the main TV sets was as follows: 9.6 million households received digital terrestrial television, 9.3 million satellite and 3.2 million cable. Digital terrestrial television has thus become the country's primary digital platform. In March 2008, Freeview (a free-to-air digital terrestrial platform) was received by about 9.2 million households and Top Up TV (a digital terrestrial pay-TV platform) had 0.4 million subscribers. The 9.3 million households that mainly receive television by satellite are split between subscribers to BSkyB (over 8.34 million households at the end of March 2008) and households that receive a free-to-air satellite service. Free-to-air satellite reception increased significantly in 2007/2008. In May 2008, the BBC and ITV launched Freesat, a free-to-air digital satellite distribution platform that permits access to about 80 television channels and radio stations. In early 2008, about 700,000 households received programmes in this way. In April 2008, the European Commission has launched an investigation under EC Treaty state aid rules into state aid proposed by the UK authorities for Channel 4 to help it meet the capital costs of digital switchover. The Commission will investigate whether this subsidy threatens to distort competition in the Single Market. In October 2007, the UK authorities notified to the Commission their proposal to grant GBP 14 million (EUR 21,2 million) of aid to Channel 4 to assist it to meet the capital costs of digital switchover. Channel 4 is a broadcaster incorporated as a public corporation with no shareholders and entrusted with a public service remit. It is the core channel of Channel 4 Corporation (C4C) and is run on a commercial basis only (all revenue is derived from advertising and other commercial activities, with no public funding). |
Technological developments, new services and new channels
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Last modified : 2008-10-14
The database MAVISE is edited by the European Audiovisual Observatory for the DG Communication of the European Commission.
© 2007 European Commission.
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