ITN entered into exclusive negotiations with ITV on September 26 after a bitter battle between ITN and challenger Channel 3 News, a consortium backed by BSkyB.
Channel 3 News tried to undercut ITN by a considerable margin, which resulted in ITN having to rethink its bid price to around £33m, down £13m from its initial bid of £46m.
ITN had been charging more than £40m a year to supply ITV1 with news, until Channel 3 News said it could do it for £30m a year. The challenger also accused ITN of using the ITV money to subsidise ventures in new markets it was trying to break into.
As part of the deal, ITN will provide ITV with a tailored online news service. It will also see ITN's North American news-gathering operation expanded.
ITN's shareholders include ITV shareholders Carlton Communications and Granada, alongside the Daily Mail & General Trust, United Business Media and Reuters.
ITN had always been odds-on favourite to win the race because Carlton and Granada control 90% of ITV.
Steve Anderson, ITV controller of news and current affairs, said, "ITV was in the happy position of having a choice between two high-quality bids from ITN and Channel 3 News. Both companies worked hard to deliver the high specifications in our tender document."
He added, "We opted for ITN's impressive line-up of presenters, reporters and editorial staff, its proven track record for delivering a service tailored to the ITV audience, and its exciting plans for the future. I am delighted that we have agreed the new contract. Television news will undergo revolutionary change in the next decade and we are now ideally placed to rise to the challenge."
However, the news will come as a bitter blow to BSkyB owner Rupert Murdoch, who has been trying to gain a foothold in the UK terrestrial TV market for some time.
If you have an opinion on this or any other issue raised on Brand
Republic, join the debate in the .
_1.jpg)
.jpg)
