The satellite broadcaster's monopoly on pay-TV will end, with terrestrial channels allowed to enter the market. David Forster, media analyst at Merrill Lynch, said: "BSkyB faces real competition in this market for the first time. It still has a very strong hand in sports and subscription services, but its margins will be under threat."
Sam Chisholm, BSkyB chief executive, said the company welcomed the expansion of choice for consumers.
Among the winners could be the BBC, which has been granted the right to broadcast on digital wavebands and introduce pay-per-view services. The Corporation faces conflicts between its traditional licence revenue and any new pay service if it attempts to make viewers pay twice for the same programming.
It is unlikely that any ITV company will take on BSkyB single-handed. Powerful consortia will be needed to mount a realistic challenge. BSkyB itself is linked to Granada, which will prove a powerful alliance should the latter decide to embark on its own terrestrial digital service.
America's NBC and Disney and Germany's Bertelsmann are being tipped as new media players in the UK.
Under the proposals announced on Friday terrestrial ITV companies would be allowed a maximum of 15 per cent of audience share. Cross-media ownership rules are to be relaxed.
The winners and losers
BBC: the Beeb will be allowed BSkyB: its monopoly
to provide pay-per-view TV position as the UK's only
for the first time in its charter. pay-TV provider to end.
C4: favourable review of its HTV: "Nobody in their right
funding to take place in 1998, mind will bid for the company
reducing royalties to ITV. at these levels." - City analyst.
Carlton: shares in Michael Green's Yorkshire Tyne-Tees: as
South East franchise fell in above. There is also scope
expectation of the company for a bidder to cut costs. The
"launching bids left right and shares could well prove
centre". But Green's canniness is uninteresting throughout next
likely to make the most of the year.
new openings now on offer.
Capital Radio: likely to lose
MAI: Labour supporter Lord Hollick its independence.
can evaluate his next best move,
starting from a position of strength.