Media Forum: Is it time to free the regions?

Should Ofcom ease the cross-media ownership rules, Alasdair Reid asks.

It's always been a complex affair, this triangular relationship between the Government, Ofcom and the regional media sector.

And, of course, it's made even more fraught when there's a change in the political guard.

Regional media owners have been pleading poverty for years, having been hit earlier by that combination of the downturn and the digital revolution that subsequently made life so difficult for the traditional media marketplace. It would make their life easier, they have always argued, if cross-media ownership restrictions were eased.

During the closing months of the last Labour regime, Ofcom was asked to have a look at doing just that. As a result, a slight liberalisation was proposed - though it was still deemed dangerous to contemplate a scenario whereby one company might acquire more than 50 per cent of the newspapers in a region plus radio and TV interests.

No surprise, then, that when the new coalition Government came to power, the economic liberals in its ranks reckoned that Ofcom could do better. Well, Ofcom has indeed had another look but its conclusions seem strangely familiar. "Limited plurality of news and opinion in a local area could restrict local debate and accountability," it maintains. "This remains a serious consideration which needs to be weighed against the arguments for further relaxation."

The Government, obviously, remains the ultimate arbiter of this - but there will be those who argue that Ofcom has missed a golden opportunity to show that it can move with the times.

William Rogers, the chief executive of The Local Radio Company, is of that view. TLRC is the fourth-largest player in the commercial radio market and one that has made clear its desire to grow.

Rogers says: "Ofcom's attitude seems to be that it won't consider changes unless everyone is in a desperate state and keeling over and screaming. Change is needed and it will be interesting now to see how the Government responds. After all, it's the Government's job to produce policy and the regulator's job to administer that policy. So we'll be looking for the Government to make a clear statement of intent."

But John Prentice, the head of regional media at PHD, isn't a fan of further liberalisation. He reckons Ofcom has already proposed far too many concessions: "The rules around local media ownership exist to protect the plurality, diversity and impartiality of local news reporting and opinion. This helps to guard against undue concentration of influence in local news channels. Proponents of the change point to the various alternative sources for local news, such as the BBC, local internet blogs and the recent proposals for local TV.

However, there appears to be little appetite for the new local TV model and it is far too early to suggest that local TV is a realistic alternative to local press news content."

And he predicts: "Consolidation would deliver limited efficiency savings, and while some financial benefits might be possible by leveraging new local cross-media monopolies to drive up yield in the longer term, this would be to the detriment of local businesses. It opens up the longer-term spectre of cross-media monopolies evolving over time."

Meanwhile, Stuart Taylor, the chief executive of GMG Radio, points out that cross-media regulation evolved in a bygone era of bandwidth scarcity - and is wholly inappropriate in a digital age.

He adds: "I'm in favour of further liberalisation of cross-media ownership regulation as the competition authorities can intervene on a case-by-case basis anyway - but in an age of Twitter, Facebook and Google, I believe Ofcom should redefine what too much power in one place looks like. The key issue for the Government is ensuring the preservation of consumer choice and plurality. With a strong BBC across the UK, it is essential that commercial media are allowed to thrive to ensure that choice."

Santha Rasaiah, the Newspaper Society's political, editorial and regulatory affairs director, agrees. She says: "We welcome Ofcom's recognition of the realities of today's fiercely competitive local media world, which weigh against outdated fears of local news monopoly and manipulation."

She suggests the competition authorities should be allowed to make judgments informed by their understanding of these new realities. She concludes: "As Ofcom says, it is now for Government and Parliament to decide. They should act to remove these outdated and unnecessary cross-media restrictions."

YES - William Rogers, chief executive, The Local Radio Company

"We find it very disappointing that Ofcom is not embracing change. The media landscape is changing but Ofcom seems reluctant to acknowledge this. The Government's response should be interesting."

NO - John Prentice, head of regional media, PHD

"No positive benefits have been suggested beyond a vague assertion that consolidation could support a financially ailing local newspaper market. Cross-media ownership is not the saviour of local media."

YES - Stuart Taylor, chief executive, GMG Radio

"People's media consumption comes from an increasingly wide variety of sources across their region, the country and the world, so the dominance of one media owner does not carry the threat it once did."

YES - Santha Rasaiah, director, Newspaper Society

"The regional industry has a greater audience for its trusted local journalism than ever before. It needs to be freed from outdated regulation which restricts its development of services in whatever combination of media that they want."


Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus