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Interesting speech by Cultrue Secretary Jeremy Hunt the other day on how a flourishing local media could be encouraged.

He said:

As many people here will know, I have long believed that the lack of high quality local TV is one of the biggest gaps in British broadcasting.

Why? Because, ironically, in an age of globalism people feel the need for stronger not weaker connections to the communities in which they live.

And this government is committed to strengthening those ties by giving local communities far greater control over their own destinies.

That is why Eric Pickles’ department has opened up all items of local government expenditure over £500 to full transparency.

And why we support more elected mayors and elected police commissioners.

But for this to happen we need strong local media to nurture a sense of local identity and hold locally-elected politicians to account.

It happens elsewhere.

New York has 6 local TV stations – compared to London which has not one.

Birmingham Alabama, an example some of you may have heard me use before, has 8 local TV stations – despite being a quarter the size of our Birmingham that, again, doesn’t even have one.

Paris, Lyon and Marseilles have local TV. Why not Glasgow, Sheffield and Bristol?

Unfortunately even as politicians have paid lip service to localism, our broadcasting ecology has pursued the polar opposite model – with a large proportion of news beamed shamelessly from the centre.

The six million dollar question, of course, is not about the desirability of local TV but its viability.

The local advertising market in the UK is quite different from that in the US, and this probably represents the greatest single challenge for making local TV work on a sustainable basis.

At the same time, technology has massively lowered the costs of broadcasting. It is now possible to set up a news studio for as little as £250,000.

And consumer research has shown consistently high levels of public support for local news stories.

So how do we intend to progress this ambition?

Firstly, by recognising that plans for Independently Funded News Consortia were misguided.

They had the positive benefit of stimulating new and imaginative thinking amongst local media companies for which I am grateful – and I want to carry on talking to those who submitted bids about your ideas.

But, fundamentally, they were about subsidising the existing regional news system in a way that would have blocked the emergence of new and vibrant local media models fit for the digital age.

They risked turning a whole generation of media companies into subsidy junkies, focusing all their efforts not on attracting viewers but on persuading ministers and regulators to give them more cash.

That’s why I am today announcing that the savings from the  IFNC pilots will be used instead to support the market testing plans for the roll-out of superfast broadband mentioned earlier.

Secondly, I can announce that I will be accepting Ofcom’s recommendations on reforming local cross-media ownership rules – meaning that those rules will be significantly relaxed to allow local newspapers to own local commercial radio stations and set up local TV stations as well as benefit from greater economies of scale.

But in addition I have asked Ofcom to go further and look whether we should remove all cross-media ownership rules at a local level.

Consumers are hopping freely from platform to platform. Media companies need to be able to follow their customers – and a sensible regulatory environment would allow them to do just that whilst
ensuring concerns about local monopolies were sensibly addressed.

I will therefore update these rules and bring secondary legislation to the House to enact these changes this summer.

Thirdly, I want to ensure that, as government, we are doing everything we can to make new local media models viable in this country.

Local broadcasting can be supported by a number of potential sources of revenue – whether advertising, sponsorship, product placement, the sub-letting of spare capacity or carriage fees.

But I want to settle once and for all what needs to change to make local broadcasting economically viable in the UK.

So today I am announcing that I have asked Nicholas Shott, Head of UK Investment Banking at Lazard, to look at the potential for commercially viable local television stations within the local media
landscape right across the nations and regions of the UK.

And I have asked Nick to look at how a modernised, updated regulatory environment could help nurture a new generation of hungry, ambitious and profitable local media companies.

Based on his findings, I will be publishing a full, local media action plan in the autumn.

 

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