The Government’s White Paper Broadcasting in the ‘90s: competition, choice and quality (1988) first proposed an additional terrestrial channel. Government studies established that coverage of 65-70% of the population could be provided on Ultra High Frequency (UHF) in the band using channels 35 and 37. These could be received by existing TV receivers, although some viewers might need a new or additional aerial. Both channels were being used for a variety of non-broadcasting purposes, but these users would be moved to other frequencies. An additional consideration was the need, in some areas for video recorders and other domestic equipment to be retuned to avoid interference from the C5 signal. Channel 5 was planned to enlarge the choice of a majority of UK viewers and to introduce new competition to the advertising market.
Broadcasting Act 1990
Section 28 required the ITC to do all that it could to establish a fifth terrestrial channel. Section 29 required the ITC to award a Channel 5 licence on the basis of a competitive tender. The Commission had to be satisfied that applicants passed a quality threshold in terms of programming. Taken as a whole, the programmes included in the service must be of high quality and be calculated to appeal to a wide variety of tastes and interests. In addition, all applicants were required to submit a cash bid and business plan. The Commission had to be satisfied that the applicants could maintain the service throughout the 10-year licence. Section 30 relates to equipment retuning, as a result of interference from Channel 5, which must be done at the expense of the licensee.
Invitation to Apply in 1992
The ITC issued the Invitation to apply for Channel 5 licence on 14 April 1992. One application was received by the ITC on 7 July 1992 from Channel Five Holdings Ltd. In December 1992, the ITC announced that, after twice extending the timetable for its decision at the applicant’s request, the Channel 5 licence would not be awarded to Channel Five Holdings Ltd, because the applicant’s business plan and level of investor commitment were not satisfactory.
The Commission announced that it would start a review of the options available, including readvertisement of the licence. In July 1993, the ITC published a consultation document incorporating the results of an ITC technical review. By October more than 70 responses had been received, including declarations of interest from parties who might wish to apply for C5 if readvertised. In February 1994 the ITC considered there was a strong case for readvertising but needed Government confirmation that frequencies were still available.
Frequency availability
On 14 July 1994, the Secretary of State for National Heritage outlined the Government’s decision that one of the two frequencies (channel 35) originally approved for Channel 5 would no longer be available for this purpose. The ITC expressed concern, but managed to clear transmitter sites to raise the possible C5 coverage to more than 60%.
Readvertisement of C5
On 15 September 1994, the ITC announced that it had decided to readvertise a licence for Channel 5. The Invitation to Apply was issued on 1 November 1994 with the closing date set as 2 May 1995.
Retuning. Applicants had to demonstrate, in the form of a detailed plan with the resources to back it, the capability to retune all domestic equipment which would suffer interference from the Channel 5 signal.
Coverage. The ITC cleared transmitter sites to increase the potential coverage from 50% of the population to 66%. The ITC specified a minimum starting area, with full coverage (66%) to be achieved as quickly as possible and no later than year 5 of the 10-year licence.
Programmes. An initial minimum amount of time was set by the ITC, with a higher minimum which the licensee would be expected to satisfy in the sixth year of the licence, in each of the mandatory programme categories.
Tender. The first part of the tender was set by the ITC at zero.
Applications
On 2 May 1995 the ITC received four applications for the Channel 5 licence. They were (with cash bid in brackets): C5 Broadcasting Ltd (£22,002,000); New Century TV Ltd £2,000,000; UKTV (£36,261,158)
Virgin TV Ltd (£22,002,000).
On the two identical bids, the ITC sought and received undertakings in relation to collusion from both C5 Broadcasting Ltd and Virgin Television Ltd.
An ITC leaflet ‘New Channel 5 licence - your chance to comment’ invited viewers to address the proposals in the applications and outlined the licensing process. Comments were also invited from the ITC’s Viewer Consultative Councils (VCCs). These were taken into account by the Commission.
Licence Award
On 27 October 1995 the ITC announced its decision to award the C5 licence to Channel 5 Broadcasting Ltd (C5B). C5B and New Century Television (NCTV) both passed the quality threshold requirement in relation to programming whereas UKTV and Virgin TV did not for different reasons comply with this requirement. C5B’s cash bid was higher than that of NCTV and therefore the licence was awarded to it.
Judicial Review
Virgin TV subsequently appealed against the ITC decision and on 22 November 1995 the High Court granted leave for a judicial review of the decision. The judgement was issued on 26 January 1996, with Virgin TV’s challenge failing. The review found nothing to indicate illegality or unfairness in the ITC’s award of the Channel 5 licence and there was no evidence to suggest C5B was treated preferentially.
ITC grants licence
The ITC confirmed the grant of the Channel 5 licence to C5B on 18 April 1996. The licence sets out the conditions attaching to the service, including tables specifying the range of programmes and amounts of original productions and commissions.
Channel 5 launched its service on 30 March 1997. In the run-up to the start of the service, C5B undertook a major retuning programme of domestic equipment to avoid interference from the C5 signal. C5B had to comply with the ITC Code of Practice on Equipment Retuning and needed to retune 90% of homes affected before the service could start. In September 1996, the Department of Trade & Industry allocated Channel 35 for use by C5, therefore extending the broadcaster’s coverage. This frequency has been allocated for an initial period of 5 years.
The first nine months of Channel 5’s services was reviewed in the ITC Annual Report and Accounts 1997. The channel had, it said, “made a promising start and the service is broadly in line with its application commitment. In some areas, such as news, children’s and religion, the channel has brought a freshness and vitality, and shown determination to satisfy hitherto unmet needs.” By 2002 (the sixth year of broadcasting) Channel 5 had achieved a 6.28% share of all television viewing. Improvements in transmission arrangements have extended Channel 5’s terrestrial coverage to 80% The service is also available on cable, satellite and DTT. In 2002 the channel was relaunched as Five. Its licence was renewed on 1 April 2003.
Channel 5 Additional Services
In November 1996 the ITC advertised a single licence to provide an additional service or services on all of the available spare capacity on the Channel 5 signal. Applicants were free to propose any mixture of teletext or similar services on an open access (either free-to-air or subscription) or closed user group basis.
The ITC received two applications for the licence. Sky Five Text Ltd (BSkyB and C5B), with a bid of £1,500,557, and Text5 Ltd (Teletext Holdings) with a bid of £313,000.
In July 1997, the ITC awarded the licence to Sky Five Text Ltd. It provided a free-to-air open access service of news and other information. At the end of 2001 the company surrendered its licence. In April 2002 a new licence was awarded to Teletext Ltd for the provision of a news and information service.
Channel 5 and Digital Terrestrial Television
Channel 5, along with other existing terrestrial broadcasters, accepted guaranteed capacity on a digital terrestrial multiplex to simulcast its existing service. The BBC was guaranteed a whole multiplex, and Channels 3 and 4 and public teletext were given a single multiplex. Channel 5 has guaranteed space on Multiplex A, which went out to competitive tender. It was awarded to S4C Digital Networks Ltd (SDN), the sole applicant. See ITC Note 40 for more details.
Further References
ITC Publications
* ITC Library bibliography: Channel 5
News releases on Channel 5: 5 /92, 6/92, 19/92, 24/92, 44/92, 65/92, 6/93, 33/93, 13/94, 45/94, 57/94, 23/95, 32/95, 3/958, 4/952, 78/95, 85/95, 7/96, 24/96, 42/96,21/97, 61/97, 22/98, 47/98, 12/03, 16/03
Consultation on the future of Channel 5. July 1993.
Invitation to apply for Channel 5 licence, 1 November 1994
Channel 5 Chronology
Channel 5 Licence (£10). ITC. 1996.
Code of Practice on Equipment Retuning for C5. ITC. 1996.
ITC Annual Report and Accounts 2001, 2002.
External Publication
Department of National Heritage news release (DNH 105/94) June 2003
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