Media owners cry freedom

How far will the Government go when it changes the rules on cross-media ownership this autumn and whose advice should it take?

SBHD: How far will the Government go when it changes the rules on cross-media ownership this autumn and whose advice should it take?

The news that the Government is revving up its legislative programme for the autumn, with space for a bill on cross-media ownership, has revived the hopes of publishers and TV companies just as they were giving up ever seeing a relaxation of the rules.

Only this month, there were reports that Heritage Secretary Stephen Dorrell had abandoned thoughts of wide-ranging changes and was merely planning to “tinker”, allowing newspaper publishers to own 29.9 per cent of an ITV company, rather than 20 per cent, as at present.

That story generated dismay, not just among publishers but among leader writers. The Daily Telegraph, one of the publishers lobbying Government under the umbrella of the British Media Industry Group (BMIG), de-clared its interest in a leader headed “Missed opportunity”, which thundered: “Hampering our own industry does nothing to prevent a concentration of power by foreign companies: if anything, the reverse… A free and healthy press depends not only on freedom of speech, but its commercial freedom as well.”

Carlton chairman Michael Green, writing in another BMIG publication, the Daily Mail, declared: “When world television is being carved up by the big international companies, British firms are being handicapped from the start. We’re losing out in terms of jobs, programmes and influence in the world.”

The Heritage Department is letting it be known that earlier reports were too pessimistic. The fact that a newspaper company’s holding in an ITV company might rise only to 29.9 per cent – a change which would not require a full act of Parliament – did not mean there might not be other changes to the rules.

Dorrell is not short of advice as to what those changes should be. Carlton is urging him to make the ownership of TV companies a matter of normal competition policy, with share of ad revenue the crucial factor. Fears about the impact on programming – quality, diversity and regional focus – would be addressed, as now, by the regulator, the Independent Television Commission, with its powers to warn, fine and remove licences from those who fail to fulfil their commitments.

The BMIG – representing the Daily Telegraph, Associated Newspapers, Pearson and the Guardian – has revived the “share of voice” argument, already put forward in varying forms by the consultant Richard Hooper and News International. This maintains that the media are converging and should be treated as one, with media “usage” – the editorial impact on the reader, listener or viewer – being the important measure rather than shares of ad revenue.

The BMIG has commissioned research which shows that, in terms of the national share of voice, it is the BBC which dominates, with a 19.7 per cent share, followed by News International with 10.6 per cent, Daily Mail & General Trust with 7.8 per cent, and Mirror Group Newspapers with 7.6 per cent. The BBC’s lead comes despite the fact that BMIG recommends that radio listening be down-weighted by 50 per cent because of its “perceived lower impact on diversity of view issues” – a claim that Jonathan Aitken and those who have joined in the row about the Today programme’s John Humphrys might question.

David Montgomery, the chief executive of Mirror Group, which commands 44 per cent of the Independent titles and is currently minus one of its editors, has also given the Government his view in the keynote address at TV95. He too would like to see a “share of market” policy, but with companies given freedom to choose how that share was distributed between print and broadcast. He said such a scheme would allow Mirror Group to own Scottish Television and the Daily Record, with resulting synergies and efficiencies – though he said that was not the group’s goal.

So where does all this leave the Government? If it is looking for a way forward, it may well end up paying close attention to a speech given this week by Charles Allen, the chief executive of Granada Television. Speaking at a seminar organised by the Social Market Foundation, Allen might almost have been sending Dorrell a lifeline.

Whether other media groups will be so pleased is another matter. Allen laid out three alternatives – Carlton’s free market approach, the BMIG’s “share of voice” approach and the one he favours, a halfway house. All had their good points, he said, but the cautious policy was the right one.

Rejecting the free market view, he said there might come a time when a competition law approach would be right – but that point had not yet been reached. “As long as there are a small number of commercial TV channels which capture the lion’s share of audiences, the ownership of those channels is a matter of legitimate public interest and concern.”

The single market approach also had several drawbacks, Allen said, not least the difficulty of putting a value on each media outlet. He also questioned the argument that radio should be allocated 50 per cent of the influence of TV, not on the grounds that the Today programme is more powerful but that other radio outlets are weaker. “Is it realistic to suggest that listening to Classic FM as background music carries even 50 per cent of the influence that watching an ITV company’s regional news bulletin does?”

On Montgomery’s suggestion that there might be benefits in bringing together the two newsrooms of the Daily Record and Scottish TV, Allen said that would raise legitimate concerns. “Having one news editor rather than two determining the news agenda, and three rather than six reporters covering the key political issues must, by definition, reduce the multitude of voices.”

Allen favours a series of gradual steps, as terrestrial TV services lose audience share. The first would be to allow news-papers to increase their stakes in TV companies to 29.9 per cent, with the assumption that this would be increased over time.

In ITV, he said the current “two-licence” rule means that in revenue terms the largest grouping – Carlton-Central – was 45 per cent bigger than the next largest, his own Granada-LWT, and more than twice as big as the third largest. “Yet none of these companies can grow because we have all reached the limit of owning two licences.” He therefore suggests market share should be the measure, with Parliament – as opposed to a regulator – decreeing that no company should have more than 25 per cent of total TV ad revenue.

Granada is not acting without self-interest – its proposals would improve its own prospects more than those of rivals. But with the Government seeking a way through the political and commercial minefield, the Granada route has its attractions.

Torin Douglas is BBC Radio’s correspondent.

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