||This article needs additional citations for verification. (May 2009)|
|Former type||Carlton Communications plc and Granada plc joint venture|
|Fate||Formal broadcasting of replacement Freeview service begins|
|Defunct||30 June 2002|
|Headquarters||Marco Polo House, Battersea, London, United Kingdom|
|Products||Pay TV services and programming|
ITV Digital was a British digital terrestrial television broadcaster, which launched a pay-TV service on the world's first digital terrestrial television network. Started as ONdigital in 1998, the network was briefly re-branded as ITV Digital in July 2001, before the service ceased permanently in June 2002. Its main shareholders were Carlton Communications and Granada plc. It was particularly noted for its failure to break into the digital television market.
Digital terrestrial television (DTT) began in the United Kingdom in 1998. Six multiplexes were set up, with three of them allocated to the existing analogue broadcasters. The other three multiplexes were auctioned off. A consortium of Carlton Television, Granada Television and British Sky Broadcasting won the auction as British Digital Broadcasting (BDB). The brand ONdigital was adopted for launch. BSkyB was forced by the Independent Television Commission (ITC) to withdraw from the consortium on competition grounds; this effectively placed Sky in direct competition with the newly launched service (although BSkyB was still forced to provide key channels such as Sky Movies and Sky Sports to the service). In all ONdigital was given one year from being awarded the licence to launching the first DTT service. In addition to launching audio and video services, they also led the specification of an industry-wide advanced interactive engine (based on MHEG-5). This was an open standard that was then used by all broadcasters on DTT.
The new digital broadcaster was launched on 15 November 1998, with a lineup of 18 channels, including many channels developed in-house by Carlton and Granada. On 7 March 2000, Onmail was launched, followed closely on 18 September 2000, by ONdigital launching an Internet television service, ONnet, and in the same year a deal with multiplex operator SDN led to the launch of pay-per-view service ONrequest.
From the launch date, however, the service was quickly losing money. Aggressive marketing by BSkyB for their own digital service, Sky Digital, made the ONdigital offer look unattractive. The new digital satellite service provided a dish, Digibox, installation and around 200 channels for £159, a lower price than ONdigital at £199. ONdigital's subscription pricing had been set to compare with the older Sky analogue service of 20 channels. ONdigital also failed to realise that Sky had cast off its downmarket image and believed there was considerable public antipathy towards Sky (and Rupert Murdoch); but this appeared to matter much less than they had hoped.
The ONdigital management team hoped to obtain the upper hand by a series of 'free set top box' promotions (initially at retailers such as Currys and Dixons) when ONdigital receiving equipment was purchased at the same time as a television set or similarly priced piece of equipment. These offers eventually became permanent, with the set-top box 'loaned' to the customer at no charge for as long as they continued to subscribe to ONdigital. The offer was swiftly matched by Sky.
Additional problems for ONdigital were caused by the choice of 64QAM broadcast mode, coupled with far weaker than expected broadcast power, (meaning that the signal was weak in many areas), a complex pricing structure (comprising many menu options), a poor quality subscriber management system (badly adapted from Canal+), a paper magazine TV guide whereas BSkyB had provided an electronic programme guide (EPG), insufficient technical customer services, and much signal piracy. While there was a limited return path provided via an in-built 2400 baud modem, there was no requirement (as with BSkyB) to connect the set-top box's modem to a phone line.
Later problems occurred when ONdigital began to sell 'ONprepaid', a set-top box bundle sold in high street stores and supermarkets at a price that included - in theory - the set-top box on loan and the first year's subscription package. Thousands of these packages were also sold at well below retail price on auction sites such as the then-popular QXL. As the call to activate the viewing card did not require any bank details, many ONdigital boxes which were technically on loan were at unverifiable addresses. This was later changed so a customer could not walk away with a box without ONdigital verifying their address. Many customers did not activate the viewing card at all, although where the viewer's address was known, ONdigital would write informing them that they must activate before a certain deadline.
Additionally, the OnDigital pay-per-view channels had been encrypted using a system - SECA MediaGuard - which had been subsequently cracked. ITV Digital did not update this system, therefore it was very easy for people to produce and sell counterfeit subscription cards which would give access to all the channels. In 2002, Canal+ accused News Corp of extracting the UserROM code from the MediaGuard cards and leaking it onto the internet. Canal+ brought a lawsuit against News Corporation alleging that they, with the help of NDS, had been working on breaking the MediaGuard smartcards used by Canal+, ITV Digital and other non-Murdoch-owned TV companies throughout Europe. The action was later partially dropped after News Corporation agreed to buy Canal Plus's struggling Italian operation Telepiu. Other legal action by Echostar/NagraStar was being pursued as late as August 2005 accusing NDS of the same wrongdoing. In 2008, NDS was found to have broken piracy laws by hacking EchoStar Communications’ smart card system, however only $1,500 in statutory damages were awarded.
Finally, Carlton and Granada had chosen not to employ ONdigital management and staff directly, so many people were on short-term contracts and key people left with no notice.
In desperation at the churn rate, Carlton and Granada turned to their most valuable asset - the ITV brand - and on 11 July 2001 rebranded ONdigital as ITV Digital. They also (in a very expensive deal) purchased the TV rights to the Football League and launched the ITV Sport Channel. A massive re-branding campaign was launched to support the new naming, with customers even being sent ITV Digital stickers to place over the existing ONdigital logos on their remote controls and set top boxes. The software running on the receivers was never changed though, and always displayed 'ON' on nearly every screen. A plan to change the onscreen software was planned along with a change to a stronger encryption system in Autumn 2002 however this of course never arose due to liquidation. The rebrand was not without controversy as SMG plc (owner of Scottish Television and Grampian Television), UTV and Channel Television all pointed out that the ITV brand did not belong solely to Carlton and Granada. SMG and UTV initially refused to carry the advertising campaign for ITV Digital and did not allow the ITV Sports Channel space on their multiplex, meaning that it was not available at launch in most of Scotland and Northern Ireland. The case was resolved in Scotland, and the Channel Islands and later still in Northern Ireland, allowing the ITV Sport Channel to launch in the non-Carlton and Granada regions (although it was never made available in the Channel Islands, as the islands do not have DTT or Cable and it never appeared on Sky Digital).
ITV Digital also ran a famous advertising campaign involving the comedian Johnny Vegas and a knitted monkey (voiced by Ben Miller). A replica knitted monkey could be obtained by signing up to ITV Digital. Because the monkey could not be obtained without signing up to the service, a popular market for second-hand monkeys developed. At one time, original ITV Digital Monkeys were fetching several hundred pounds on eBay, and even knitting patterns delivered by email were sold for several pounds. In early 2007, the knitted monkey and Johnny Vegas reappeared in an advert for PG Tips tea, which included a reference to ITV Digital's downfall.
Administration and Freeview 
These changes failed to revive the broadcaster. Indeed, the cost of the Football League deal proved one too many a burden for ITV Digital, and it was placed into administration on 27 March 2002, after the League refused to accept a £130m pay cut in its £315m deal with the ITV Sport Channel. Most subscription channels ceased broadcasting on ITV Digital on 1 May 2002. The collapse on 30 June 2002 caused severe financial difficulties for lower-division football clubs who had budgeted for large incomes from the television contract. The Football League sued ITV Digital's parent companies, Carlton and Granada, claiming that the firms had breached their contract in failing to deliver the guaranteed income. And so, by the end of June 2002, the service ceased. The League lost the case, with the judge ruling that it had "failed to extract sufficient written guarantees". The League then filed a negligence claim against its lawyers for failing to press for a written guarantee at the time of the deal with ITV Digital. This time it was awarded a paltry £4 in damages of the £150m it was seeking.
A consortium made up of the BBC, BSkyB and Crown Castle International was granted ITV Digital's old broadcasting licence, and launched the Freeview service on 30 October 2002, offering 30 free-to-air TV channels and 20 free-to-air radio channels including several interactive channels such as BBCi and Teletext but no subscription or premium services. Those followed on 31 March 2004 when Top Up TV began broadcasting eleven pay TV channels in timeshared broadcast slots.
During 2002, ITV Digital's liquidators started to ask customers to return set top boxes or pay a £39.99 fee. This deteriorated from a request to a plea, with one liquidator's representative speaking to Nick Ferrari on LBC 97.3 to justify why they wanted the money, but when asked 'How are you going to force people to return these boxes, are you going to employ collection agencies?' the response was a feeble 'Please, I just want them back'. Had the move been successful, this could have threatened to undermine the fledgling Freeview service, since at the time most digital terrestrial receivers were former ONdigital and ITV Digital units. Carlton and Granada stepped in and paid £2.8m to have the boxes stay with their customers, as at the time the ITV companies received a discount on their licence payments based on the number of digital homes they had converted. Second hand ONdigital receivers are widely available from sources such as eBay and were fully compatible with the successor Freeview system (and also with Top Up TV). They do have some drawbacks however: they are slower than more modern boxes with faster processors (ONdigital receivers often take several seconds to change channel for example) and lack support for the full Freeview Electronic Programme Guide, as this feature was introduced well after the ONdigital receiver software was written. The receiver software can also be buggy, causing the boxes lock up and refuse to respond to keypresses on the remote control. In addition, the set top boxes do not support the '8k' transmission mode which is being introduced across the UK following 'digital switchover' in each region.
Following the administration in 2002, the three multiplexes that were run by ITV Digital remained blank until a week or so before Freeview's launch. However, E4 and FilmFour continued broadcasting for over two weeks after the shutdown. Strangely however, E4 carried subtitles until the placeholder was deleted in September 2002. Most of the original ITV Digital channel placeholders and Logical Channel Numbers were kept until Freeview's replaced them, leaving large gaps between channels.
ITV Digital operated out of Marco Polo House, the south London building home to shopping channel QVC and which had once housed The Observer newspaper, but perhaps most famous as the lavish headquarters of the ill-fated British Satellite Broadcasting. ITV Digital had call centres located in Pembroke Dock, Plymouth and used outsourced BT call centres in Cork, Republic of Ireland and Belfast, Northern Ireland.
Set top boxes 
This is a list of ex-ITV and ONdigital set-top boxes. All boxes used similar software, in that a unified interface and design was used between all models. Top Up TV provided a small update in 2004 which upgraded minor technicalities with encryption services.
- Nokia Mediamaster 9850T
- Pace Micro Technology DTR-730, DTR-735
- Philips DTX 6370, DTX 6371, DTX 6372
- Pioneer DBR-T200, DBR-T210
- Sony VTX-D500U
- Toshiba DTB2000
Dating from the first days of digital terrestrial transmissions in 1998-2002, the boxes were generally more cumbersome than more modern offerings, but nevertheless initially still comptible with subsequent Freeview broadcasts. MHEG services ran noticeably slower. However, all these set top boxes (and some ONdigital branded IDTVs) become unusable in regions after the following digital switchover (DSO), as post-DSO broadcasts utilise a newer 8k modulation scheme with which this earlier equipment is not compatible, compared to the 2k modulation used by initial DTT broadcasts in the UK. Since no other European countries use the 2k format, this effectively ends the useful life of any remaining boxes that were still in use.
ONdigital and ITVdigital could also be received with an Integrated Digitial Television (iDTV) receiver. They used a Conditional Access Module (CAM) with a smart card, plugged into a DVB Common Interface slot in the back of the set.
Purchasers of iDTVs were given a substantially discounted price on using the ONdigital service, as there was no cost for a set-top box.
Some of the original iDTVs needed firmware upgrades to work with the CAM. For example, Sony sent technicians out to homes to make the necessary updates free of charge.
Carlton/Granada digital television channels 
Carlton and Granada (later ITV Digital Channels Ltd) created a selection of channels, which formed some of the core content of channels available via the service, which were:
|Channel name||Year removed||Reason/Notes|
|Carlton Kids||2000||Was timeshared with Carlton World. Replaced by a timeshare of Discovery Kids and Discovery Wings.|
|Carlton World||2000||Was timeshared with Carlton Kids. Replaced by a timeshare of Discovery Kids and Discovery Wings.|
|ONsport 1||2001||Replaced by ITV Sport Channel, ITV Sport Extra and ITV Sport Select.|
|ONsport 2||2001||Replaced by ITV Sport Channel, ITV Sport Extra and ITV Sport Select.|
|TASTE CFN||2001||Known as Carlton Food Network until 1 May 2001.|
|Granada Breeze||2002||Known as Granada Good Life until 1 May 1998.|
|ITV Select||2002||Known as ONrequest until 22 August 2001.|
|ITV Sport Channel||2002|
|ITV Sport Extra||2002|
|ITV Sport Select||2002|
|Shop!||2002||Joint venture between Granada and Littlewoods.|
|Wellbeing||2002||Joint venture between Granada and Boots.|
|Carlton Cinema||2003||Failed to guarantee carriage on Sky.|
|Plus||2004||Known as Granada Plus until early 2000s. Closed due to launch of ITV3.|
|ITV News Channel||2005||Known as ITN News Channel until after the collapse of ITV Digital.|
|Men & Motors||2010||Known as Granada Men & Motors until early 2000s.|
Timeline of events 
- 29 July 1998 - BDB rebrand as ONdigital
- 15 November 1998 - Formal broadcasting begins
- 1 May 2000 - Formal broadcasting of pay-per-view (PPV) service ONrequest begins
- 11 July 2001 - ONdigital rebrand as ITV Digital
- 22 August 2001 - PPV service ONrequest rebrands as ITV Select
- 27 March 2002 - ITV Digital placed into administration
- 1 May 2002 - Pay-TV operations cease
- 30 October 2002 - Formal broadcasting of replacement Freeview service begins
See also 
- Itv Big Two lead digital revolution. Eric Reguly and Carol Midgley. The Times, Wednesday, 25 June 1997
- "ONdigital Announces Channel Packages And Launch Date". MediaTel. 28 September 1998.
- "Ondigital on course for 1 million customers". PR Newswire.
- "ONnet Hits The Streets With More Than 40 Brands On Board". Service Engineers Forum. 18 September 2000.
- "Tempting the digital refuseniks". BBC News. 19 March 2002.
- Cassy, John; Paul Murphy (13 March 2002). "How codebreakers cracked the secrets of the smart card". London: The Guardian. Retrieved 2008-02-25.
- Bennett, Neil (31 March 2002). "ITV Digital set to sue Murdoch". The Daily Telegraph (London).
- "Vivendi settles row with NDS". London: The Guardian. 2 May 2003. Retrieved 2008-05-20.
- Tryhorn, Chris (30 April 2002). "Murdoch lines up Sky Italia". London: The Guardian. Retrieved 2008-05-20.
- Sullivan, Bob. "Pay-TV piracy flap intensifies". MSNBC. Retrieved 2008-02-25.
- "EchoStar Wins Battle, Loses War In News Corp. Piracy Case". Multichannel News. Retrieved 2008-06-21.
- "Ondigital relaunches as ITV Digital". BBC News. 11 July 2001.
- "YouTube Video of ITV Digital DPG displaying ONDigital Logo on ITV Digital branded channel".
- "ITV Digital gets support from SMG". Sport Business. 28 September 2001.
- ITV Monkey funds TV shopping start-up silicon.com, 11 July 2002
- "Football League loses damages bid". BBC News. 23 June 2006.
- ONdigital in liquidation Information for subscribers
- ONdigital history site
- ITV Digital / PG Tips Monkey Mavis, 8 March 2009 - Knitting kit for Monkey
- ITV Digital goes broke BBC News, 27 March 2002
- Set-top box offers low-cost digital BBC News, 29 March 2002