ITV cries foul over BBC digital bid

The BBC could save £50m of licence payers' money if it abandoned its bid for digital terrestrial television licences and signed up with a rival proposition from ITV and Channel 4, it was claimed yesterday.

ITV and Channel 4 last night wrote to the BBC, offering to undercut the broadcast fees the corporation is committed to paying under its own bid for the DTT licences now up for grabs, after the failure of ITV Digital.

ITV and Channel 4 said they hoped to break the "deadlock" which saw them and the BBC break off talks over a joint bid and submit separate proposals.

The regulator, the Independent Television Commission, is now considering rival bids from the BBC, ITV/Channel 4 and two other contenders. It is due to award the licences by 4 July.

Under its scheme, the BBC is working with transmission group Crown Castle, which will physically broadcast the 24 free-to-air channels envisaged, for a fee per station. The BBC would pay Crown Castle to broadcast four of its channels.

Crown Castle will charge carriage fees of £3.8m per channel per annum, according to ITV/Channel 4, which offered the BBC carriage at £2.7m per channel per annum instead. The £1.1m saving per channel gives a £4.4m total saving per year or £50m over the 12-year life of the DTT licences. ITV/Channel 4 are understood to have separately told the ITC that Crown Castle's charges – which they would have to pay if the BBC won the contest – are excessive.

A source close to the ITV/Channel 4 bid said: "This offer means that the BBC can join a bid with an almost identical free-to-air line-up and save the licence payer £50m."