Local Media

Debate between Lord Watson of Wyre Forest and Lord Foster of Bath

Thursday 24th June 2010 Westminster Hall

[Mr Foster]

That is obviously a matter for subsequent announcements that the Minister will no doubt make. I do not want to second-guess him. I have already hinted that the Government would be wise to give careful consideration to the sixth purpose of the BBC. That could happen in combination with several other measures that would help to drive up demand, which I shall come to, and that would incentivise the commercial companies—Virgin, BT and others—to act, for their own benefit. There are ways forward.

The other television organisation that has been mentioned is ITV, which has been a catalyst for debate because of its decision to reduce regional television. Many people have been deeply concerned about that. There is a new management team, and ITV seems at least willing to consider maintaining present regional TV levels, rather than making further cuts. The decisions have not yet been made. However, certain things should be done to provide support to ITV. Ofcom is already looking at the airtime sales rules, and we shall have to wait for the outcome. It is considering—I would hope it would do it rather more urgently—the issue of minutage, particularly in peak time. However, there is a key area in which it is important for the coalition Government to find a solution: the problems currently caused by the contract rights renewal situation. That is a fetter on ITV’s opportunity to develop a rational approach to the sale of advertising. I fully appreciate the difficulties, although it is not appropriate to go into them here. I hope that the Minister will make some reference to the issue and give a commitment that the Government will do all they can to find a solution, perhaps working with colleagues in the Department for Business, Innovation and Skills.

The Minister has mentioned something else that will be helpful for local and regional media—the reduction of regulation of cross-media ownership. The Secretary of State referred in his speech at the Hospital club to Ofcom’s recommendations, and an agreement to proceed with those, but he said he wanted to go further, and if possible to remove the rules altogether. Of course he rightly entered a caveat, saying that we must bear in mind monopoly situations, which would be a matter of concern to us all. I hope that the Minister will be willing to consider, in addition to monopolies, the other side of the coin: all our deliberations—on all mergers—should include a public interest test. On some occasions a public interest test would suggest going ahead with something even if it would lead to a monopoly. We should introduce such a test not just for cross-media ownership but for monopolies. That is a possible approach.

There is a problem for the coalition Government and we should make no bones about it. The two parties in the coalition started their approach to independently funded news consortia from different positions. The Conservative party was opposed to them and the Liberal Democrats wanted to go ahead with the three trials. The coalition agreement states that we shall not go ahead, and I support that because of the Minister’s clear acknowledgment that although they were not necessarily the right way forward, valuable lessons had been learned from the work that was done in setting up the potential trial areas. The question for the coalition Government is whether to grasp the opportunities of those lessons and find ways to take them forward.

I mentioned Project Canvas. With that, people will be able to sit in front of their televisions and see programmes that come from satellite, free-to-air or, effectively, their computer, via broadband. It would then be perfectly possible to develop a model of local television, which the Secretary of State and the Minister are interested in developing—I support them in that—through an internet protocol television route. That would be one potential model. We could then bring into partnership local and regional newspapers, local radio stations and other interested groups, and many others in the creative industries, in developing programmes. A model could be developed that could provide truly local television, which would support the other parts of the local and regional media industries. That would bring something of real interest to communities, and would be a sustainable model.

[Mr Watson]

The hon. Gentleman will not be able to answer this, because none of us has an answer, but although I follow the logic of his argument, is not the advertising revenue model from which organisations now work finite? What he suggests might load greater obligation and cost on to local news organisations without an increase in revenues to cover it.

[Mr Foster]

I hear what the hon. Gentleman says, but all I am suggesting is that I hope the review will consider the model I describe. That model could also receive support from the BBC and ITV, to provide some programming through partnership arrangements with the BBC and Canvas and ITV and its regional news outlets. That could provide a new route forward. Interestingly, the Select Committee hinted at it as a possibility in its report, and it ties in with the precise wording of the coalition agreement, which mentions partnerships between all those bodies.

Of course, as the Secretary of State said, there would also be the possibility of having straightforward, free-to-air local TV stations, but in those circumstances it is almost certain that they would have to use the interleaved spectrum. As we know, there is pressure on that spectrum for other uses such as programme making and special events—PMSE—and so on, so there are problems to be overcome, but it would be interesting to look at both models.

My final point on this subject to the Minister, and through him to the Secretary of State, is that reference is often made to the situation in America. We are aware, of course, that many of the American stations that he referred to are actually cable television stations—that is, the equivalent of broadband today. The one advantage of developing that model as part of the package is that it would be a key driver for broadband take-up. Broadband roll-out is crucial, but it is equally important that there is high take-up of broadband as it is rolled out. If that occurs, there will be a greater incentive for commercial operators to do a greater proportion of the work than they might otherwise do, thereby reducing the requirement on the state to fill in the gaps for rural and hard-to-reach areas. The model that I am describing would have the advantage of driving up broadband take-up.