Has the "Multichannel Era" killed off quality Television?

Even earlier than I thought!

Very interesting. That would have been the original Ally Pally transmission on 405 lines.
The BBC TV 405 line transmissions that lasted until 1985, were in the very lower part of
the VHF band, in an area called Band 1. Ally Pally used Ch 1, which related to a frequency
of 45 MHz. Those Band I frequencies are very often affected by troposphere ducting, and
their use has largely been abandoned for broadcasting (at least in Europe) . As demonstrated,
they could travel thousands of miles.

Holme Moss that served a very large slice of Northern England used Ch 2, and its reception was often
ruined by interference from European TV stations. In the end the BBC managed to secure
space and frequencies in Band III (The VHF band that was used by ITV, and is much higher
in frequency) and shared the ITA sites at Winter Hill and Belmont to provide an alternative BBC 1 405 line service each side of the Pennines. (It also allowed the BBC to launch separate regions (to match ITV's Granada and YTV)

Today, Band I's only broadcast use is for low power studio to transmitter links for small local radio stations, and Band III is used for DAB radio.

BTW, because of terrestrial overspill, several parts of Europe enjoyed a relatively large choice of channels long before the advent of multichannel TV (albeit in different languages). Here's a passage from a book published in 1972 (The Universal Eye: World Television in the Seventies by Timothy Green):

"The ordinary family in Brussels can, with a good aerial and a modified television set, view no less than eleven channels in five countries. Besides Belgium's own two channels -- one broadcasting in French, the other in Flemish -- Belgians have a choice of two channels from ORTF in France (three from 1972 onwards), three from Germany, two from the Netherlands and one from Luxembourg."

In answer to the original question...yes. The slices of the cake are becoming too small now, making it difficult to commit to quality tv, which costs more!

Yes is the answer quality has been affected, certainly when I use to watch ITV on a Friday or Saturday night, you knew on Friday you were treated to two quality sitcoms and a drama, and the rest of the week quiz shows like the Krypton Factor gracing the schedules, all those wonderful ITV franchises showcasing their fantastic idents, those were the days

I agree totally!

Good examples. I believe the reason for shows like the Kryton Factor disappearing is the cost and more to than the price of insurance has gone through the roof compared to the old days.

The grapevine suggests there is more red tape now than 20 years ago.

Yeah, that and the fact Krypton was pretty much a ratings disaster when it returned in 2009, attracting less viewers than a Wallace & Gromit repeat on the BBC and by the end of the first series of the new format, it was practically haemorrhaging viewers like there was no tomorrow. How it ended up with a second series is one of life's great mysteries.

It was awful lets be fair, on a running time of what 20mins? plus it was on a crap timeslot

It wasn't that bad and I'd much rather classic shows be cut slightly to fit a 22-minute "half hour" slot than dragged out to the full hour like most game shows are nowadays. I think it was completely advertiser funded (by Sage IIRC), so ultimately it was probably them rather than ITV who pulled the plug.

You thought it was excellent:

It was (at least partly) advertiser funded by Sage. It's quite easy to make bad TV ratings sound reasonable to companies involved in AFP because the amount of individual people is still quite large. A number of AFP shows that have all but flopped in the TV sense have returned for a second series because the company has been willing to pay up again.