Commentary: Latest episode in a TV farce

The decision by TV-am to pull out of the Entertainment Channel, the consortium it put together to bid for Channel 5, shows how much of a dogs' breakfast the Independent Television Commission's regulation of commercial TV has become. After the preposterous scramble for licences on ITV - the 'highest bids win unless they don't' system - the ITC needed Channel 5 to be a success to regain credibility.

Now it looks as if the Entertainment Channel bid has fallen apart. Since Silvio Berlusconi, the Italian TV mogul, gave up the ghost a few weeks ago, this leaves only one declared runner - the Thames/Sony/CityTV grouping Five TV. Although there are rumours of another secret rival, there is a chance that the ITC will find next Tuesday that Five TV has put in an uncontested bid of pounds 1.

The problem has always been technical. Under the ITC's rules, the Channel 5 winners would have to retune up to 60 per cent of the video recorders in the UK to avoid interference. The cost has been estimated at more than pounds 400m, which is a big deterrent for a channel with perhaps 15 per cent of viewers.

Back in the real world of ITV, the ITC's rules prevent mergers between 'large' ITV companies, with the result that there is no British TV group with the muscle to compete with, say, Mr Berlusconi. At the same time it allows Rupert Murdoch to hold 50 per cent of BSkyB when he would not be allowed to own more than 20 per cent of Border TV, and the BBC is allowed to promote its own magazines with adverts at the end of its programmes. David Mellor, our minster of fun, has a lot to do.

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