On September 22, 1955, at 7:15 in the evening, Associated-Rediffusion began broadcasting to about 250,000 homes in the London area, and the BBC's television monopoly in Britain came to an end. The first evening included a news bulletin, a variety show, and an episode of an American crime series. Associated TeleVision took over at the weekend. The two companies split the London franchise between them, which was how the system was meant to work.
It had taken years of argument to get there. The BBC had held a monopoly of sound broadcasting since 1927 and of television since 1936, and the case against commercial television was that advertising would drag standards down and that the airwaves were a public resource. The Beveridge Committee in 1951 recommended keeping the monopoly. A minority report by Selwyn Lloyd argued for competition. Churchill's government took the minority view, and the Television Act of 1954 set up the Independent Television Authority.
The structure was a compromise that has been copied a good deal. The ITA owned the transmitters and leased them to programme companies, which were awarded regional franchises for fixed terms and were not allowed to own more than one, and which had to buy their programmes partly from independent producers. Advertising was sold in spots between programmes rather than embedded in them, and there was to be no sponsorship of a programme by its advertiser. News came from ITN.
The first years were rough. ITV lost money heavily at first, because the advertising revenue was smaller than expected and the programming obligations were expensive. It bought American imports because they were cheap and popular, and it ran quiz shows with big prizes, which the BBC had disdained. By 1958 it had about half the audience and was making money.
The consequences for the BBC were larger than for anyone else. ITV's audiences were consistently bigger from 1957 onward, and the BBC responded with the Pilkington Committee of 1962, which criticised ITV and recommended that the BBC be given the third channel, which it got as BBC2 in 1964. ITN's news, with its different style and its own presenters, forced the BBC to change how it did bulletins. Colour came in 1969. The system now is one company, ITV plc, holding most of the English and Welsh franchises.