ITV's most popular shows would get more funds

ITV is losing the battle for viewers against the BBC.

Despite big-hitting soaps such as Coronation Street and Emmerdale, it is still consistently beaten by BBC One for audience share.

It has scored some enviable successes with peak-time audiences - notably with family-friendly shows such as Who Wants To Be A Millionaire? and Pop Idol.

But although it remains ahead of the competition in peak time, ratings are flat during daytime and off-peak periods.

The merger would free up �50m

The network has also been fighting to regain its self-esteem following the PR disaster of last year's �315m ITV Digital collapse.

News battle

The traditional fight for viewers stepped up a gear when the BBC moved its main evening bulletin from the 2100 timeslot three years ago.

ITV moved its news from 2200 to 2300 in March 1999, and the BBC moved in to fill the vacant slot.

But ITV was forced to switch back after the ITC found its replacement was attracting too few viewers.

ITV made a temporary move to 2100 during the war in Iraq, and has kept a short update at that time despite moving the main bulletin back to 2200.

The days when ITV marketed itself as 'Britain's most popular button' seem a distant memory Media analyst Graham Lovelace

Now it will finally move its late news bulletin to a regular slot at 2230 after winning approval from TV regulators.

Early evening weakness

A particular problem for ITV has been the 1700 to 1800 slot, where Crossroads failed spectacularly.

Possible solutions put forward by Nigel Pickard, ITV's director of programming, include a Dale Winton quiz, a lifestyle programme about moving house, and a brain-teaser called 24 Hour Quiz.

Analysts say the merger would also help ITV gather the funds to fight back against the BBC as well as its other terrestrial rivals, Channel 4 and the rapidly emerging Five.

"The theory is that by merging back-office functions the two groups can liberate a combined saving of �50m," said Graham Lovelace, of media consultancy Lovelacemedia.

"ITV is likely to use that cash to invest in more hit dramas, plus peak time entertainment, and boost its daytime programming."

Michael Green is leading Carlton's merger talks

Mr Lovelace said ITV needed the focus of a single management team.

"The days when ITV marketed itself as 'Channel 3, Britain's most popular button' seem a distant memory," he said.

"Its total audience share has halved since the early 1980s as first Channel 4, then Five started to erode its lead."

Decling audience

Mr Lovelace said programmers were addressing the weak spots in the schedule - especially daytime which had suffered from the defection of Richard & Judy to Channel 4, and the failed Crossroads resurrection.

Under the merger ITV intends to maintain its status as a major player in the face of increased competition.

RISE OF ITV ITV first broadcast on 22 September 1955, with ATV one of the original companies Cinema firm Granada joins the network, taking the northern franchise in 1956 First colour programmes shown in 1969 Daytime TV begins in 1972 after broadcast restrictions lifted ATV becomes Central in 1981 franchise shakeout Media group Carlton wins London contract in 1991 Carlton buys Central in 1993 Deregulation helps Carlton and Granada own most of ITV by the end of the 1990s

Much of the savings will be ploughed into better programming, including more dramas and daytime shows.

A Carlton spokesman said: "We will be investing more in programmes. Viewers will get better programmes - they will get more special events and more dramas.

"The merger will create a stronger ITV which will deliver for viewers."

Granada said programmes like Coronation Street - the UK's most popular show - and Emmerdale would go from strength to strength under the deal.

"The unique role ITV plays in bringing together the regions of Britain in our programming will be sustained," said a spokeswoman.

"ITV programmes are mainly made outside London, and ITV will be able to invest in the richness of regional culture."

She added: "We will see more seamless news programming - divisions between regional, national and international news will go, and there will be more coherence."