Andrew Harrison: On Lord Carters digital vision

“Given that communications is supposed to be one of our most creative sectors, it is often one of the most conservative sectors when it comes to looking at future solutions.” So said broadcasting minister Lord Carter last week at one of the media industry’s first public outings of 2009.

Carter’s tough views on the sector and its operators are important – not just because he’s led an agency, a media business and a regulator in our industry (at JWT, NTL and Ofcom respectively), although that does mean, somewhat atypically, he’s a politician who’s worked in the real world of commercial decision-making – but also because he’s due to deliver the Government’s first draft of its Digital Britain report next week.

At a time when most media businesses are struggling to look beyond the end of the first quarter of 2009, Carter’s report is likely to set the legal and regulatory framework for our industry for the future. His plan is to introduce proposals which will form the backbone of the next Communications Act, designed to usher Britain fully into the digital age, and will try to ensure that our communications framework with its origins early in the last century – phone, TV and radio – can survive well into this one.

But to get to the sunlit uplands of a digital economy, Carter has to guide the industry away from its analogue legacy.

The key policy areas Carter plans to tackle are all fraught with controversy, tangled up with the vested interests of analogue incumbents and digital pioneers. So, while he’s keen to pursue some new breakthrough ideas, it’s no wonder Britain’s media businesses are all sharpening their own axes.

The likely centrepiece of Carter’s report will be a commitment to universal broadband access for all – the modern-day equivalent of a universal postal system, which started in the 19th century, or a universal telephone system from the 20th century. The trouble is, laying down that sort of broadband infrastructure from Skye to Cornwall costs a lot more than a first class stamp or a weekend phone call. At the moment, BT is the sole provider of landline phone lines or dial-up internet – a responsibility borne from its monopoly status as a state provider until 1984. Now, it’s making it clear it won’t pay to put high speed fibre-optic lines as well as traditional copper into all homes.

The solution would seem to be, rather than an expensive fixed line rollout, to encourage the newer ISPs and mobile phone companies to chip in and offer wireless internet access, in return for the huge increase in subscribers that universal access will bring. But that’s tricky too: O2 and Vodafone own the best mobile spectrum for wireless access and offering that to Orange and T-Mobile looks a bit like selling your star centre forward to a rival in the transfer window.

If a tricky issue in the telecoms sector were not enough, sorting out Channel 4’s £100m funding gap looks pretty difficult too. Any solution that merges the part-public/part-private C4 fully into public or private ownership is fraught with vested interests. Certainly, C4 and the Beeb have different views: C4 wants to merge with BBC Worldwide to solve its problem; but the BBC wants it to merge with Five instead. Either deal is complicated and controversial – just as is top-slicing the licence fee instead or fully privatising Channel 4. One way or another, Channel 4’s days as an independent broadcaster look numbered.

In newspapers, there’s the challenge to liberalise ownership regulation that prevents the consolidation and re-structuring that might yet help the stronger titles from Trinity Mirror and Johnston press, let alone Tindle, Kent Messenger and all the smaller groups to survive. It will be hard to rollout broadband everywhere for all on the one hand, but then still tie local newspapers to ownership controls that were designed for Beaverbrook not Google.

And having liberalised newspaper ownership, what about cross-sector rules at a local level, so that commercial radio and local newspapers can join forces to compete with the BBC and provide a compelling news and content alternative at a local level?

Which brings us last – but not forgotten – to radio, where Carter needs to be as bold and imaginative as he is likely to be on broadband and public service TV. The Government has signalled its commitment to digital radio; the industry wants it – and the listener will finally enjoy a breadth of exciting content – from the BBC and commercial sectors – especially at a national level, which is precluded by the scarcity of analogue spectrum – where we have a mere five national FM stations.

The sector is small and can’t afford the structural investment cost in new transmitters and in-car radios. Now is the time for an imaginative new deal that facilitates commercial freedom to operate on the analogue airwaves for a few short years, with intervention and investment from the Government now, in exchange for exciting new content we can all enjoy in a digital Britain.

Getting these decisions right, and the support of commercial and public service operators, across broadband, television, press and radio, will define our media landscape for the next half-century.