Broadcast Now: Five mulls switch to pay-TV

Originally being the smallest of the five 'national' terrestrial channels along with having a patchy analogue terrestrial TV coverage area even at its peak, Channel Five has always occupied a slightly awkward position sandwiched between the big four channels and the multichannel masses; more significant than Living TV but smaller than Channel 4.

The fact that Five is currently a "problem child" of a big and restless corporate owner (RTL) certainly does suggest that a pay-TV strategy for its three UK channels is certainly a viable option; for one thing, putting Five behind a pay wall is certainly a more plausible idea compared to (say) ITV doing the same with ITV1.

However there are two downsides to Five following such a strategy, and there may also be a connection with the rationale that may be currently discouraging ITV from doing the same with ITV2/3/4. As well as losing its public service status, Five might also miss out on a merger with Channel 4 if such an idea were to become workable in the near future.

A merger with a bigger and more established channel would give Five more credibility and more viewers compared with being just another pay-TV channel on Sky and Virgin, albeit one with a highly preferential channel number, and Five's owner RTL has always been very ambitious in European markets where it has a television broadcasting presence.

That level of ambition will almost certainly mandate a free-to-air presence for at least one channel that RTL owns (despite the stated potential economic downsides), and a merger with another broadcaster (inevitably ITV or Channel 4) will be RTL's only way of capturing that anticipated large slice of the UK commercial television market it has waited so long for.

So RTL has to balance its future ambitions with a requirement to keep its three UK channels viable in a market which is particularly volatile for the smaller free-to-air TV channels, especially when US imports are now often caught up in a bidding war between Channel 4, Sky and Virgin Media, which for one thing caused Five to lose House to Sky.

Whichever way both ITV and Channel 4 will jump in the near future will determine the future fate of Channel Five, and in turn will ultimately dictate the future of UK commercial television broadcasting. Not bad going for a channel which was literally created out of gaps in the analogue TV broadcasting system.