Media Forum: Is regional shake-up viable?

Do the Government's new regional media plans add up?

Who said the new Government would be so distracted by other issues that it would have little time for tinkering in matters media? Well, we did, actually.

But we can claim to be half-right, because the Culture Secretary Jeremy Hunt's announcement last week was, first and foremost, about fiscal prudence as opposed to ideological grandstanding.

In his first major policy speech, Hunt announced that the previous administration's "safety net" plans for regional media were to be torn up. Labour, in acknowledging the notion that ITV, in its relatively straitened circumstances, could no longer be forced to provide regional news, had come up with a State-funded alternative.

It proposed a number of regional TV news franchises to be supported by around £47 million in government backing, possibly found by taking money out of the BBC's licence-fee piggy bank.

Hunt has a better idea of how this money can be spent - on underwriting "superfast" broadband access, not least for those in rural areas. But regional news provision hasn't been forgotten. As a quid pro quo, he's proposing to loosen regulations on regional consolidation and cross-media ownership.

Larger, more efficiently run regional media owners could, in time, emerge to fill the regional television news space vacated by ITV. And it's not impossible to envisage them also extending this opportunity into the online and mobile worlds. Hunt is believed to be keen to see the emergence of a new generation of privately backed City TV stations across the UK.

Does it add up? Sceptics will argue that the free market isn't able to support this level of activity. And they might point to the recent demise of Guardian Media Group's Manchester TV station, Channel M, which has all but closed (it now produces no original programming and is run by a skeleton staff of four). They may argue too that consolidation might deliver big media owners with regional monopolies - but the emergence of monopolies doesn't always lead to the delivery of diversity and quality when it comes to content.

Georgina Harvey, the managing director of Trinity Mirror Regionals and the Newspaper Society's incoming president, says that it's a shame the news consortia scheme has been ditched. On the other hand, a greater leeway in ownership regulations will be very welcome: "The industry, through the NS, has fought hard for the liberalisation of cross-media ownership, so we welcome the Government's plans for reform. We believe that all local cross-media ownership rules, including the media public interest test, should be removed completely, allowing local media companies to develop into true multimedia businesses."

Much of that is echoed by Rachel Hall, the head of radio and regional at ZenithOptimedia - but on balance, she reckons the new framework could be good news for consumers: "It's always a problem producing quality news and making it viable - as was shown by Channel M. And if ITV can't make regional news work, then who can? And it's true that, from an advertiser point of view, the monopoly implications of liberalisation might be a worry. But media owners will see this as an opportunity to diversify and pull more money into the sector, which is important."

However, there are those, like Stuart Feather, the Edinburgh-based managing director of Feather Brooksbank, who are less than convinced. He says: "A new way of underwriting television news for Scotland would have been well received. That's no more relevant than when there's a Fifa World Cup on. News about Rio Ferdinand's knee is not entirely relevant here. From a Scottish perspective, the lead item should be the derailment of a train between Glasgow and Oban, which received scant coverage elsewhere. I'm not sure we agreed wholeheartedly about the TV news consortium proposed for Scotland, but it would have been good for Scots in general and for Scottish business. So we feel that something has been taken away - and not much given in return."

But that's certainly not the way that Dominic Williams, the press director of Carat, sees this. He concludes: "This is good news. It is encouraging for regional newspapers because consolidation will be good for them. It's in the interests of regional advertisers that regional newspapers are able to invest in editorial content - and consolidation might not be too much of a worry because advertisers targeting a particular region are interested in using combinations of TV and press and radio."

MAYBE - Georgina Harvey, MD, Trinity Mirror Regionals

"Liberalisation of ownership rules would be welcome but we don't regard City TV as a viable proposition. The UK market is different to the US and Canada - the costs are too high, the revenues too low."

MAYBE - Rachel Hall, head of radio and regional, Zenith-Optimedia

"The quality of local news and media has been at risk and that could be a problem. Communities feel really strong ties with regional media. Local media companies are important in that way - and it's good for advertisers to be able to tap into that."

NO - Stuart Feather, MD, Feather Brooksbank

"As for consolidation, I'm not sure there's masses to be gained because there's not an awful lot more opportunity there. The previous proposals wouldn't have cost a great deal - and if anyone could have afforded it, it's the BBC."

YES - Dominic Williams, press director, Carat

"Yes, regional monopolies might arise as a concern - but the Government can come back and look at it. In the short term, however, the issue for regional media owners is their very survival."

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