by Rebecca Thomas BBC News Online, in Edinburgh

Channel 5 has been named the best terrestrial TV station of the year at the Edinburgh TV Festival on Saturday.

Meanwhile, in non-terrestrial broadcasting, Sky News bagged the best channel title.

This is first time the Channel of the Year Awards have been held.

It is also the first time in the UK that individual TV channels have been singled out for their overall annual performance, according to festival director Charles Brand.

'Limited budget'

The judges based their final decisions on a wide-ranging set of criteria, including programming, ratings and creativity.

Newsreader Kirsty Wark presented the winners with their trophies.

We [Channel 5] have had an interesting birth - now you are beginning to see us mature

Dawn Airey, Channel 5 chief executive

She said Channel 5 had won because the judges thought it had achieved success "on its own terms within a limited budget... and managed to do exactly what it says on the tin".

In the past year, viewing figures for the channel have increased by 14%, although some dispute this figure because of changes to the way ratings are measured.

Much of this success has been credited to Kevin Lygo, Channel 5's new director of programming.

'Enormously flattered'

Lygo was formerly head of entertainment and music at Channel 4, where he won praise for discovering hit shows such as Trigger Happy TV and So Graham Norton.

His appointment to Channel 5 signalled the station's ambition to be taken seriously as an innovative programme-maker.

The past year has seen investment in in-house projects and hit US drama series, such as CSI: Investigation.

Earlier this week, the channel announced it was to relaunch as simply Five, and move towards championing the arts.

Lygo accepted his award along with Channel 5 chief executive Dawn Airey.

Airey said she was "enormously flattered". She added: "We [Channel 5] have had an interesting birth - now you are beginning to see us mature."

Sky was commended for its coverage of the 11 September attacks

Sky News was chosen from a shortlist consisting of E4, UK Style, Bravo, Discovery and UK Style.

Wark said it beat its contenders because the judges considered it to have had a "truly outstanding year".

Sky News has been widely commended by viewers and the broadcasting industry for the quality of its coverage of world disasters over the past 12 months, particularly the terror attacks of 11 September on the US and their repercussions.

In accepting the award, the channel's political editor Adam Bolton said: "It has been an extraordinary year, and particularly after being told for 12 years that no one was watching."

ITV 'problems'

He added that the award was particularly gratifying given that the channel had taken lots of risks with its coverage - exactly the kind of risks highlighted as lacking in UK TV by Channel 4's boss Mark Thompson in his keynote festival speech on Friday.

Thompson criticised broadcasters for having become "samey" and "risk-averse" and called upon the government to consider ways of helping Channel 4 to sustain its public service commitment to innovation through guaranteed income.

The festival is an annual gathering of key figures within UK and global TV and broadcasting media.

Another issue already explored has been the problems facing ITV.

A panel discussion between former and current ITV executives led to the network being lambasted for its "profound mismanagement" and lack of focus.

Still to come is an onstage interview with broadcaster Chris Evans and a speech by Lord Puttnam on the challenges facing the global TV industry.