ITV network licence no longer sustainable by 2012

The costs of the Channel 3 licences to provide ITV television programmes across the UK will outweigh the benefits by 2012.

This is the conclusion of Ofcom’s response to a Department for Culture, Media and Sport (DCMS) consultation on delivering TV news in the nations and regions.

Ofcom’s response says the Channel 3 regional network licences could be in deficit to the tune of £38-£64 million by 2012.

The Channel 3 regional licences allow ITV Broadcasting Limited (ITV plc) in England and Wales, UTV in Northern Ireland and STV in Scotland to broadcast terrestrially, using reserved analogue and digital signals.

PSB obligations

They come with a number of public service broadcasting (PSB) obligations, including a requirement to provide regional news services on Channel 3, which is the biggest cost.

But as the digital TV roll-out gathers pace across the UK, the value of this access to the radio spectrum is declining.

Ofcom’s response says that new funding will be required if regional news on Channel 3 is to be maintained.

The response builds on recommendations that Ofcom made to government and Parliament in January 2009 with the conclusion of its statutory review of Public Service Broadcasting.

Independent news consortia

This proposed the creation of independent news consortia, funded by competitive tender, to deliver a choice of regional news across the UK on the Channel 3 schedule. These could offer greater localness and cross-media news provision.

The consortia could be made up of existing television news providers, newspaper groups or other newsgathering agencies.

They could be chosen against a range of public criteria, including the ability to achieve the reach, editorial standards and overall quality of current Channel 3 regional productions.

Ofcom today also published a research report on Local and Regional Media in the UK, in line with its statutory duties to ensure that a wide range of high quality television and radio services with wide appeal is available throughout the UK and to maintain sufficient choice in the provision of different television and radio services and a range of other relevant duties.

Local and regional media

The report shows that the UK’s local and regional media are facing unprecedented challenges, driven by growing use of the internet.

While not-for-profit, community and ultra-local level community media are becoming more important in delivering public value, awareness and impact of these services remain low.

The report highlights the fact that consumers continue to tell Ofcom they value a choice of regionally-based television news and relevant local content.

Ofcom’s analysis suggests that independent news consortia could be an effective means of achieving this valued choice of news, alongside the BBC, while providing a potential platform for the future development of more local services, including local TV, and using other media.

Spectrum

The report also shows how the spectrum freed up after digital switchover could create further opportunities for new local TV services. Ofcom proposes to consult on the potential uses of this spectrum in due course.

The report also sets out a range of stakeholder views on the measures needed to ensure the future of local and regional media and sets out alternative proposals that have been made to foster the development of local media.

ParentPort: Working together for media standards