Don't hurry to change channel

Last week's news that ITV Digital has been placed into administration by its owners Granada and Carlton Communications dented the...

Last week's news that ITV Digital has been placed into administration by its owners Granada and Carlton Communications dented the growth of interactive television (iTV) in the UK.

And the subsequent admission by NTL, the UK's largest cable operator, that it was at risk of running out of money, further compounded the misery for those who have been talking up the digital television revolution.

The enforced retirement of the country's favourite knitted monkey will be just one of the many knock-on effects ITV Digital's demise will have. The news provides a punctuation mark in the unfolding story of digital Britain, and sets back the progress of the development of iTV services as a new channel to market for retailers.

The Government has blustered long and hard about shaping a digital Britain. In ITV Digital, the UK's only terrestrial digital TV platform, it saw a means of weaning UK consumers off the analogue signal and into the digital world.

For the Government, delivering services to the public hinges upon universal take-up of the digital signal, for it will enable the entire population to access the Internet without the need to own - or know how to use - a PC.

Now it may wish to revisit its plans to switch off the analogue signal between 2006 and 2010.

The retail sector is equally keen to capitalise on this new means of marketing to, and trading with, consumers.

Of all the clichés to emerge from the e-commerce boom and bust of two years ago, one of the most hackneyed was the claim that the Internet would open up totally new channels to market. In fact, most companies have spurned online transactional commerce in favour of harnessing the Net to improve internal processes and move closer to customers and suppliers. But iTV's user-friendly promise to put "the Internet on your TV" has tempted retailers such as, to mould an iTV presence.

Where does the demise of ITV Digital leave and those other retailers and service providers already ploughing money into developing iTV channels to market?

In truth, the problems at ITV Digital do not mean retailers should shelve all their iTV ambitions - after all, Sky still offers a gateway to the iTV arena. But its large subscriber base and greater clout makes it a pricier platform to operate upon than ITV Digital.

Faced with these uncertain times, retailers considering putting substantial investment into developing iTV channels to market may now want to exercise a little caution and re-evaluate their strategy. In the present climate, a policy of "slowly, slowly, catchee monkey" seems appropriate.

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