ITC faces payments challenge

ITV companies are to lobby the Independent Television Commission for changes to the way the television regulators' budget is financed, calling the present system "increasingly unfair and difficult to justify", writes Mathew Horsman.

The ITC, which regulates commercial television in the UK, had a budget in 1995 of pounds 15.3m, of which Channel 3, Channel 4 and Teletext companies contributed pounds 11.3m.

By contrast, the cable and satellite companies, including BSkyB, Rupert Murdoch's satellite broadcaster, paid pounds 2m.

ITV is expected to argue that the disjunction between revenue shares for different channels and their licence fee payments to the ITC is particularly striking.

ITV and Channel 4 account for 72 per cent of total television revenue, but pay 86 per cent of the ITC's budget.

Cable and satellite account for 28 per cent of commercial revenues but pay just 14 per cent of the ITC's running costs.

"Put another way, the cable and satellite channels earn almost a third of the revenue of Channels 3 and 4, yet we pay the ITC seven times as much," the ITV companies write in a draft letter.