TV-am backs out of Channel 5 bid

TV-AM is withdrawing from a planned bid for Channel 5, the proposed new terrestrial TV channel, fearing it could turn out to be an 'unmitigated disaster'.

It is understood that TV-am was put off by an estimate by British Telecom that it would cost twice as much as originally expected to retune video recorders so they would not be affected by interference from Channel 5. BT had said it could retune videos for the Entertainment Channel, the consortium that TV-am had joined, charging pounds 20 per household. But TV-am said yesterday that BT's final estimates had been far higher than had earlier been indicated.

The announcement comes just six days before next Monday's deadline for bids set by the licensing body, the Independent Television Commission. C5, which will be awarded by auction, will be capable of reaching 74 per cent of the population through aerials, although a satellite could be used to fill in other areas.

It now looks as if there may be only one bidder left for the franchise, the Five TV consortium, which includes Thames Television, Columbia and Moses Znaimer, a Canadian cable TV expert. Last week Channel S, a consortium backed by Scottish Television, pulled out, saying the costs of setting up were too great. Another interested investor, Silvio Berlusconi, the Italian media magnate, has also withdrawn.

Bruce Gyngell, chairman of TV-am and the Entertainment Channel, said yesterday: 'We've looked at it, crunched the numbers and I have to say, I wouldn't invest in it myself. So why expect institutional investors to? Sir George Russell, (chairman of the ITC) said in April he thought that Channel 5 was at best a headache, at worst a nightmare. Well, at best it's a nightmare, at worst an unmitigated disaster.'

Mr Gyngell, who said that Conrad Black's Telegraph newspaper group and Time Warner of the US were also withdrawing from the project, estimated that it would cost pounds 100m to set up transmitters and to retune videos and home computers affected by the new service.

Sources at TV-am also said that it had been shocked by estimates that up to 60 per cent of existing rooftop aerials might have to be replaced in order to receive the new terrestrial channel. This disrupted business plans, which had seen scope for concentrating on London first.

However, David Frost, who organised the bid with Jeremy Fox, a television producer, said yesterday there was still a 50-50 chance it would go ahead. He said a final decision would be made by investors on Sunday.

(Photograph omitted)

Commentary, page 23

Start your day with The Independent, sign up for daily news emails
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

SThree: Talent Acquisition Consultant

£22500 - £27000 per annum + OTE £45K: SThree: Since our inception in 1986, STh...

Day In a Page

John Palmer: 'Goldfinger' of British crime was murdered, say police

Murder of the Brink’s-MAT mastermind

'Goldfinger' of British crime's life ended in a blaze of bullets, say police
Bodyworlds museum: Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy

Dying dream of Doctor Death

Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy
UK heatwave: Temperature reaches 39.8 degrees on Central Line - the sweatiest place in London

39.8 degrees recorded on Tube

There's hot (London) and too damn hot (the Underground). Simon Usborne braved the Central line to discover what its passengers suffer
Kitchens go hi-tech: From robot chefs to recipe-shopping apps, computerised cooking is coming

Computerised cooking is coming

From apps that automatically make shopping lists from your recipe books to smart ovens and robot chefs, Kevin Maney rounds up innovations to make your mouth water
Jessie Cave interview: The Harry Potter star has published a feminist collection of cartoons

Jessie Cave's feminist cartoons

The Harry Potter star tells Alice Jones how a one-night stand changed her life
10 best barbecue books

Fire up the barbie: 10 best barbecue books

We've got Bibles to get you grilling and smoking like a true south American pro
Seifeddine Rezgui: What motivated a shy student to kill 38 holidaymakers in Tunisia?

Making of a killer

What motivated a shy student to kill 38 holidaymakers in Tunisia?
UK Heatwave: Temperatures on the tube are going to exceed the legal limit for transporting cattle

Just when you thought your commute couldn't get any worse...

Heatwave will see temperatures on the Tube exceed legal limit for transporting cattle
Exclusive - The Real Stories of Migrant Britain: Swapping Bucharest for London

The Real Stories of Migrant Britain

Meet the man who swapped Romania for the UK in a bid to provide for his family, only to discover that the home he left behind wasn't quite what it seemed
Cheaper energy on the way, but it's not all sunshine and rainbows

Cheaper energy on the way, but it's not all sunshine and rainbows

Solar power will help bring down electricity prices over the next five years, according to a new report. But it’s cheap imports of ‘dirty power’ that will lower them the most
Katy Perry prevented from buying California convent for $14.5m after nuns sell to local businesswoman instead

No grace of God for Katy Perry as sisters act to stop her buying convent

Archdiocese sues nuns who turned down star’s $14.5m because they don’t approve of her
Ajmer: The ancient Indian metropolis chosen to be a 'smart city' where residents would just be happy to have power and running water

Residents just want water and power in a city chosen to be a ‘smart’ metropolis

The Indian Government has launched an ambitious plan to transform 100 of its crumbling cities
Michael Fassbender in 'Macbeth': The Scottish play on film, from Welles to Cheggers

Something wicked?

Films of Macbeth don’t always end well - just ask Orson Welles... and Keith Chegwin
10 best sun creams for body

10 best sun creams for body

Make sure you’re protected from head to toe in the heatwave
Wimbledon 2015: Nick Bollettieri - Milos Raonic has ability to get to the top but he must learn to handle pressure in big games

Nick Bollettieri's Wimbledon files

Milos Raonic has ability to get to the top but he must learn to handle pressure in big games