Television regulators give BDB its licence

Television regulators yesterday granted the licence for British Digital Broadcasting (BDB), the pay-TV joint venture owned by Carlton and Granada which plans to start broadcasting next year, with only minimal changes.

The conditions, imposed after six months of discussions between BDB, the Independent Television Commission (ITC) and the European Commission (EC), restrict the length of the programme supply agreements to five years - and prevent BDB directors from also sitting on the board of BSkyB, its main competitor.

BSkyB was originally a member of the BDB consortium, but was forced to pull out by the ITC before the licence was awarded. However, BSkyB will still supply BDB with programmes. The original contract between BDB and BSkyB was for seven years. As a result of the conditions imposed by the ITC, it will be reduced to five.

The ITC subsequently dismissed unconfirmed reports that the EC had yet to approve the deal. An ITC spokeswoman said the body had received a letter from the EC which said it accepted the conditions and stated they were compatible with European Union law.

The EC decided to look into the licence when NTL, which lost out to BDB in the bidding process, complained that BDB's agreement to show programmes supplied by BSkyB was anti-competitive.

The conditions also effectively force Gerry Robinson, Granada's chairman, to stand down from BDB's board. Mr Robinson is also chairman of BSkyB. Granada said yesterday that Henry Staunton, finance director, would sit on BDB's board instead of Mr Robinson.

Analysts said that the conditions were no surprise. "This is just the Commission wanting to put its fingerprints on the deal," said Mathew Horsman, media analyst at the stockbroker Henderson Crosthwaite, pointing out that the agreement between BSkyB and BDB would still be renewable when the five years were up.