ITV to charge its viewers £3

ITV viewers could soon be forced to pay £3 a month to watch their favourite shows, such as Coronation Street and The X Factor.

PAY TO VIEW Katherine Kelly who plays barmaid Becky in Coronation Street PAY TO VIEW: Katherine Kelly, who plays barmaid Becky in Coronation Street

A report from the broadcaster’s City bank, the Swiss group UBS, urges financially-strapped ITV “to act now” by switching from a “free channel” to a “pay TV channel” by using Sky and Virgin Media.

The four ITV channels would then disappear overnight from Freeview. ITV1 would cease to be “Channel 3” and viewers wanting to watch ITV would be forced to take up a subscription with either Sky or Virgin.

The lowest Sky package is £16.50 a month.

Viewers already pay the BBC licence fee, which is currently £12 per month.

The ground-breaking document, “The Pay TV Opportunity”, was released last week.

The report estimates viewers would he prepared to pay £2.50 a month for ITV1, but only 50p a month for all the digital channels, ITV2, ITV3 and ITV4.

It says the proposal could boost plummeting profits at the channel by 60 per cent in three years, turning around ITV’s fortunes.

There appears to be nothing the Government can do to stop ITV becoming a pay channel.

Initially, ITV may opt only to transfer the digital channels, ITV2, 3 and 4 to see whether viewers are prepared to pay.

ITV recently announced a staggering £2.7billion loss, reduced programme budgets and swathing job cuts. Another report has revealed traditional advertising revenue will be decimated within 10 years.

This “alarming projection” says money from normal “spot” commercials will fall by 75 per cent.

“This could be the beginning of a slippery slope for the television broadcasters who are about to experience what it means to lose control of a distribution monopoly, just like the music industry,” said Andrew Sheehy, head of research at Generator Research.

He added: “The biggest losers will be the terrestrial networks [ITV, C4, Five]. ITV and Five are now worth half what they were a year ago.

“These broadcast businesses face an inevitable managed decline unless they can successfully address the opportunities presented by the digital era.”

A TV insider said: “ITV have reached a point where they would definitely consider shifting the digital channels across to pay TV, but whether they would move ITV1 is a difficult question for the current management.”

ITV have been considering the option for several months but are yet to make a decision. A spokeswoman said: “There are no current plans for pay TV.”

One snag to the plan may be football, including the money-spinning Champions League and the FA Cup. These programmes may still have to go out on a free channel.

ITV has also bought the rights to the 2014 World Cup, but these matches could then be shared with another channel.

ITV boss Michael Grade has said: “I don’t think there’s any evidence anywhere in the world where mass entertainment channels can derive revenues from subscription, either through cable or satellite delivery.

“I think it’s very dangerous to make big strategic judgments at what may or may not be the low point in the [business] cycle. There is no question about ITV’s ability to deliver mass audiences in peak time, and ITV is highly valued by the advertising market.”

Commercial radio is set to disappear within 15 years despite its popularity with older listeners.

At a recent industry conference media expert Claire Enders of Enders Analysis said: “Radio is being dwarfed by classified, online display and search.

“The next generation don’t believe in it as much.”

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