The ghost of ITV Digital may have the last laugh

The &£39.99 ITV Digital subscribers must pay to keep their boxes is a bargain – Sky won’t be savaged by a dead Monkey, but Freeview will get a fillip, says Torin Douglas

I have just sent off a cheque for &£39.99 to ONdigital. (You remember ONdigital. The old name for ITV Digital is now the new name again, presumably so that ITV won’t get even more bad publicity when its liquidator asks for the boxes back).

It’s a payment I had hoped I would not have to make.

When Grant Thornton, the liquidator, announced last month it was going to reclaim more than 1 million old set-top boxes, it came as a shock to many former subscribers. Some regarded it as an almighty cheek, considering that ITV Digital had defaulted on its service, leaving many subscribers out of pocket.

This view was aired strongly on Radio 5 Live’s breakfast show, where joint liquidator Malcolm Shierson got such a going-over from the presenters that one felt quite sorry for him. He tried to point out that all those boxes that had been “given away free” were actually on loan and still belonged to the company. It was his duty to sell them to raise money for ITV Digital’s creditors, who were owed &£1.2bn.

Shierson presented former customers with a choice. Either buy the box for &£39.99 – a saving of &£60 on the cost of a new Freeview set-top box – or ring the call centre and arrange for it to be collected free of charge.

In 5 Live phone-ins, some angry listeners pointed out that they had paid a year’s subscription in advance and demanded a refund for the months of viewing they had not received. (I understand they will be treated sympathetically).

Others said they would charge ITV Digital a “storage” cost for looking after its box. Some said they had thrown theirs away when the service stopped and they had signed up with cable or Sky instead. And others said that if they bought the box, they would want to send the cheque direct to one of the Football League clubs, the most high-profile of ITV Digital’s many creditors.

My own view was one of surprise that Grant Thornton had decided it was worth the time, effort and expense of trying to reclaim the boxes. Like all digital technology, set-top boxes are constantly coming down in price and size and improving in specification, so who – apart from the existing owners – would pay anything for the old ones? And if the existing owners didn’t want to keep them, how much would it cost to collect them?

My second surprise was that the receiver had reached me so quickly. With more than 1 million “free” boxes out there, and the demands going out in batches of 50,000, I thought I might have had a few months’ grace at least. I also hoped that, after those few months, Grant Thornton might decide it wasn’t worth pursuing everyone, because the response rate was so low and it was costing more to pick up unwanted boxes than it got back for the wanted ones.

No such luck. But having got the demand, I had no hesitation in paying up. Unlike some ONdigital customers, I always knew the box was on loan. And now that Freeview is operational, the &£39.99 price tag does represent something of a bargain. The liquidator’s letter set it out succinctly: “Digital TV through an aerial currently offers up to 30 digital TV and 11 digital radio channels. A new set-top box costs around &£100, but you can purchase yours for a one-off payment of only &£39.99.”

An accompanying leaflet listed all the available TV channels (though not, strangely, the radio ones) and explained how to retune the box if you had not already done so.

It also answered a not unimportant question: “Q. I already have cable/satellite – why would I want to purchase a set-top box?” I already knew the answer (it’s not hard), but one of the 5 Live presenters didn’t, which is why he made the mistake of giving away his ONdigital box once he began subscribing to Sky. He was a bit upset when I told him the answer: “A. The box can be used to receive digital TV through your aerial on additional sets in your home.”

In other words, forget the fact that pay-TV offers a much wider choice (at much greater cost) than Freeview. That’s a debate for the living-room TV, or for those without digital TV at all. You’ve probably also got a set in the bedroom or kitchen which can only get five channels. For &£39.99, you could make it receive up to 30, plus 11 radio networks. Why wouldn’t you?

My decision was put into perspective by a letter I had just received from Sky – which also came as a shock. It told me that the cost of my channel-package subscription was going up to &£38 a month in January. Add in &£10 for the subscription on my Sky+ box, and that’s &£48 a month! Almost &£600 a year!

Millions of Sky customers will have received the same letter. I suspect that most, like me, will continue to pay up: multi-channel TV is still growing in popularity. Last year it took a 22 per cent share of all viewing, almost as much as ITV.

But for some, it will be the trigger to rethink their multi-channel habit, trading down to a cheaper package or cancelling altogether. Or even, dare I say, considering Freeview?

Torin Douglas is media correspondent for BBC News