ITN to cut jobs as it wins new ITV contract

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ITN is to prune its 800-strong workforce after its contract to produce ITV's news coverage was extended for six years.

As part of the £250m deal, ITV will invest £15m in upgrading the ITN newsroom's technology platform. The upgrade will enable ITN to produce its news programmes more efficiently, meaning some jobs on the production side of the business will be lost.

Mark Wood, the chief executive of ITN, said the technological upgrade would produce "a more dynamic, more fleet-of-foot news operation". He said that after consulting with unions, the company will launch a voluntary redundancy programme but would not reveal the level of job cuts the company wants.

Mr Wood said that the renewed contract was awarded a slightly lower level than the previous deal signed in 2001 as a result of the merging of two separate deals to produce ITV's national news and London's regional news for the broadcaster.

Yet the head of ITN was cheered that the contract had not been put out to tender, describing the deal as a "tremendous vote of confidence" given the turbulence in the media industry. "It reflects the fact that ITV is pretty satisfied with the quality of the programming and the ratings performance," Mr Wood said.

He added that although most of the negotiations over the new deal preceded the appointment of Michael Grade as head of ITV, the BBC veteran had been quick to voice his confidence in the news production company. "He recognises the value of news in an increasingly multi-channel environment as a channel differentiator," Mr Wood said.

The new contract also includes increased funding for "in-depth" news coverage such as one-off exclusive shows like ITN's Three Degrees From Disaster and the follow-up The Big Melt. Mr Wood said that ITN is to focus on developing more-easily understood and accessible programming but denied this represented a potential "dumbing down" of its content given that more money will be pumped into producing in-depth content.

Mr Wood said that the new ITV deal provides the company with a strong platform on which it can grow its new businesses such as tailoring news for mobile phone and broadband services as well as its archive service and a new e-commerce platform to sell digital images.

ITN, which also produces news for Channel 4, is majority owned by ITV. It also counts Reuters, Daily Mail & General Trust and United Business Media among its owners.