ITV Digital, owned by Carlton Communications and Granada, is offering special rate packages including premium movie and sport channels in the hope that it will reduce its churn rate of 25%. Sky's churn rate is less than half ITV Digital's at 10%.
The broadcaster has confirmed that 5,000 customers were paying around £1 a month for the service. However, City analysts have suggested as many as 10,000 are paying less than £10 a month for their service.
In recent months, Carlton and Granada's share prices have fallen substantially amid concerns about how much money they are pumping into the broadcaster until it becomes profitable in 2004.
However, this morning the stocks were bucked by a general upturn in media shares as advertising revenues began to show signs of recovery. Carlton rose 10.9% to 183.5p and Granada rose 2.4% to 126p.
ITV Digital has 1.1m subscribers compared with rival BSkyB's 5.3m.
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