ITV negotiates final terms to sell ads around Kangaroo

ITV is negotiating the final terms of a deal to sell advertising around the BBC's inventory on Project Kangaroo, the video-on-demand joint venture service between BBC Worldwide, ITV and Channel 4.

In what is believed to have been a closed pitch between C4 and ITV earlier this year, ITV won the contract as it guaranteed a high level of revenue. But ITV is understood to be trying to change the terms of the arrangement.

One media agency head of TV said: "ITV made a ridiculous offer to win the business, but is now trying to renege on the deal as it is concerned whether the BBC is going to provide full iPlayer content for project Kangaroo or a more abridged UKTV-style back catalogue."

A senior TV figure close to ITV and C4 added: "ITV guaranteed the BBC a large amount of revenue - greater than the BBC thought it could get. C4 made calculations but wouldn't offer absolute guarantees. ITV probably did it because it needed to boost its digital sales operation."

A BBC spokesman said: "BBC Worldwide hasn't signed a binding ad sales agreement with ITV and discussions are still ongoing." ITV declined to comment.

Kangaroo could be set for a March launch, having confirmed a beta test in January ahead of the conclusion of the Competition Commission's review on 8 February, but no permanent replacement for outgoing chief executive Ashley Highfield will be made until February at the earliest.

Highfield quit the project last week to join Microsoft UK, just four months after taking on the role. At Microsoft, he will be in charge of consumer and online, a new global organisation bringing together consumer-facing products and services across PC, mobile and internet platforms.

Rod Henwood, former Channel 4 new business director, will remain interim chief executive until the end of the review.

Source: BrandRepublic