Despite opposition from commercial broadcasters, the TV regulator has decided that the impact of the new channel across the rest of the industry would be "manageable".
It is predicted that BBC Three will wield a market share of 2% after its first two or three years of broadcasting, according to ITC estimates. The channel is expected to have an impact of £7m on the commercial sector, a much smaller blow than the £15m previously feared.
"At these levels, we believe that the impact spread across commercial channels could be manageable, especially since we expect overall advertising revenue growth to have resumed over this period," the ITC report says.
Tessa Jowell, the secretary for culture, media and sport, rejected the first proposal for the channel, which was to be aimed at 16- to 34-year-olds, last year following concerns that it would duplicate services offered by commercial broadcasters such as Sky One and Channel 4.
The BBC submitted a renewed proposal for the channel, placing more emphasis on news and current affairs, with a revised, slightly older audience of 25- to 34-year-olds.
Jowell is expected to make an announcement about the future of BBC Three later this week, which will coincide with the ITC's decision on the future of the digital TV licences freed by the demise of ITV Digital. The BBC has submitted the frontrunning proposal for the licence, supported by BSkyB.
Weekend reports suggested that it was set to win the digital licence.
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