The Stage

ITV digital makeover includes new drama channel

Published Tuesday 29 June 2004 at 11:55 by Joanna Taylor

Television drama will play a key role in ITV’s £36 million makeover of its digital operations, which chief executive Charles Allen hopes will finally lay to rest the devastating collapse of ITV Digital two years ago.

ITV3 will be launched this winter, targeting the over-35 audience with a diet of drama and films. it will form part of Allen’s strategy to triple the network’s income from its digital channels to £150 million by 2007. This compares with approximately £50 million made per year by the network’s existing digital portfolio - ITV2 and the ITV news channel.

ITV2, the broadcaster’s digital station aimed at 16 to 34-year-olds, will get an extra £24 million - doubling its current programme budget. Allen has also agreed to a £12 million allowance for ITV3.

Said Allen: “Just four months after the creation of ITV plc our strategy is delivering. The merger has enabled us to attract and retain the best talent in the industry. Already the benefits of one ITV are apparent in our performance and efficiency. We have a strong foundation for the ambitious plans we have to grow our business.”

Allen hopes that this new multichannel strategy will prove more successful than the ill-fated ITV Digital pay-TV scheme which collapsed in 2002 and, along with an advertising downturn, is reported to have cost the broadcaster £300 million that year.

The backlash that followed saw more than 100 former employees joining forces to fight a £2million legal battle over their redundancy. Granada chief executive Steve Morrison ended a 28-year relationship with the company some five months later with City analysts saying his departure was inevitable.

ITV2, however, has been more successful and is now the third most watched non-terrestrial channel in homes that have digital sets with a higher total reach than Sky One. One industry expert said Allen, who was kept on by the ITV board to revive the brand, will be keen to be seen to be building on this success rather than overseeing the cutbacks that followed ITV Digital’s collapse.

“[The board] thought Allen could deliver financially by reducing costs. It is not a terrific policy in terms of running an organisation that relies on morale so he has got to come up with bigger ideas. With [new BSkyB chief executive] James Murdoch hitting the ground running and having put out Freeview, ITV looks very lacklustre. I think after slashing back in Manchester he has got to be seen to be on the multi-channel wave” he said.

The broadcaster has also announced a range of new dramas for its terrestrial station ITV1 including the new Miss Marple adaptations, Ahead of the Class starring Julie Walters and Doc Martin with Martin Clunes.

Returning programmes will include Rosemary and Thyme - the highest rating new drama of 2003 - Foyle’s War and popular reality show I’m a Celebrity… Get Me Out of Here!