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The fear is that Mr Murdoch, with his five national titles, extensive US holdings and a stranglehold on UK satellite broadcasting, will make an offer that cannot be refused.The two other likely bidders are a consortium led by Pearson, which publishes the Financial Times, and Virgin TV, the multi-partner group put together by the Virgin Group. Getting a fifth terrestrial channel on air has proved problematic. The Independent Television Commission – charged with overseeing commercial TV – first invited bids in 1992, only to shelve the idea when the single bidder, Thames, failed to provide

evidence of firm financial backing.
This time, a storm over the Government’s media cross-ownership rules has cast a pall over proceedings. At the centre of the storm is Rupert Murdoch, who has a 40 per cent stake in the Channel 5 hopeful BSkyB.Some of his competitors, and a handful of backbenchers, have called for changes in the bidding process, under which the highest bidder gets the licence – provided quality thresholds and financial backing are acceptable to the ITC. The winner will first have to overcome the retuning hurdle.BSkyB is thought to view retuning as an opportunity as much as an obstacle. Having to send representatives into perhaps 6 million homes would provide a chance to sell satellite services Virgin believes it would not have to visit every home.

Instead it would provide a freephone number for Channel 5 viewers to ring; Virgin representatives would then judge whether an in-home visit was necessary.In the end, whoever wins the licence is likely to receive approaches the next day from independent producers in bed with other bidders. The final product may not look precisely like any of the bids landing today, with an almighty thump, on sundry desks at the ITC.Business, page 24. All three bidders are likely to want a soap.The winner will need to build an audience quickly if it is to clinch the lucrative advertising contracts needed to turn an operating profit within the projected three to five years Simply attracting audiences won’t be enough, however. And Pearson can call on Grundy Worldwide, maker of game shows and soaps such as Neighbours. Pearson bought the Australian company earlier this year for £175m.

A favoured approach has been to sign producers of current hits, hoping they can make lightning strike twice by supplying another highly popular show.For example, Virgin has an understanding with the producers of Poirot and the Ruth Rendell Mysteries. All three bidders have set up arrangements with independent television producers, in an effort to meet the minimum requirements set down by the ITC for original programming. Indeed, Virgin TV is steering clear of sport.The real battleground may be drama. It would, however, produce a current affairs news magazine programme – lighter in content and tone than the BBC’s Panorama or ITV’s World in Action.Children’s programming is where Virgin TV hopes to win big audiences. With partner HTV, already an important producer of children’s fare, Virgin plans to develop 12 new programmes and to broadcast 30 hours of children’s programming a week, eight times the minimum required by the ITC.When it comes to sports programming, however, neither Pearson nor Virgin can come close to competing with BSkyB, already a dominant sports broadcaster. BSkyB would also be likely to tap its own resources at Sky News. Virgin would go a different route, offering hourly bulletins of about three minutes each but no flagship evening news programme.

Pearson, publisher of the Financial Times and 50 per cent owner of the Economist, has a strong franchise in business news and would be expected to make it a prominent part of its schedule. Virgin TV would show The Big Lounge every evening at 11pm, featuring guests and regular routines and hosted by a newcomer whom Devereux describes as being “the next Chris Evans”.News programming, an important part of the ITC’s requirement for Channel 5, is likely to differentiate each bidder from its competition. There is no obligation to purchase”.All three proposals are believed to include talk show formats as well. These would be a mixture of classics, made- for-television movies and a pinch of first-run fare.Robert Devereux, head of Virgin TV, says the presence of Paramount Television in the consortium is an indication of the importance of made-for-TV films to Virgin’s plans. But, he insists, “all Paramount product in the schedule will be negotiated on an arm’s length basis.

These might be made available for terrestrial broadcast as part of a broader deal with film producers to show them on Sky and Channel 5 at different times.Virgin plans to show 1,000 films a year, at the rate of about 20 a week, many at peak viewing times. BSkyB, with partners TCI, PolyGram, Goldman Sachs, the European broadcaster Kinnevik and perhaps Granada, is expected to offer big-event television premieres of popular movies, probably earlier than the three-year waiting time currently imposed on Britain’s earthbound TV channels. Virgin TV would have first call on UK television rights.Film is a favoured strand of all three bidders. Nor will there be any regional programming, as ITV and the BBC routinely provide. Instead, we will be treated, in varying amounts, to drama, films, sport, children’s programming and light entertainment.All have promised significant spending on independent British production. Virgin TV – backed by the Virgin Group, the electronics company Philips, the US-based Paramount Television, the ITV company HTV, and Associated Newspapers – is promising to set up a credit facility with Coutts to offer as much as £100m to help fund British independent production. There will be no catering to “minority views”, as Channel 4 is mandated to do.