Ofcom backs cross-media rules relaxation

Tuesday, November 17 2009, 12:53 GMT

By Andrew Laughlin,

Ofcom has recommended changes in current cross-media ownership rules to allow conglomerates to help ease the economic "challenges" facing local media outlets.

Following its initial report in July, the regulator has now submitted a more formal consultation on cross-media ownership to culture secretary Ben Bradshaw.

Despite consumers increasingly utilising the internet as a source of news, Ofcom said that there remains a "strong reliance" on TV, newspapers and radio for up-to-date information.

However, the regulator also discovered in its consultation that media industries are now facing "significant economic change", particularly in terms of local media outlets.

The watchdog therefore recommended a relaxation of local ownership rules to ensure that commercial providers can still provide a quality alternative to the BBC's ouput.

To achieve this aim, Ofcom advised Bradshaw to remove the local radio service and multiplex ownership rules to free up stations to remain commercially viable. Its research has indicated that most consumers are not overly concerned by one operator owning multiple local radio stations in one area.

In turn, the regulator wants to liberalise cross media ownership rules so that a single company can own more than one local newspaper, radio station or Channel 3 licence in an area. The only restriction would be that a single organisation cannot own all three media sources or exceed 50% local market share.

Under Ofcom's plan, all news providers feeding national and international stories to Channel 3 licence holders must be independent from the BBC and appropriately funded so that the service remains a viable alternative to the corporation's coverage.

The watchdog has previously given its full backing to the government's plan for independently funded news consortia to take on ITV regional news provision in the UK. Trial schemes for this approach could go ahead in April next year.

"In line with our statutory duties, we have today set out recommendations for government and parliament," said Ofcom chief executive Ed Richards.

"These proposals would allow local media companies more flexibility to respond to the challenges that they are facing while at the same time protecting plurality for listeners and viewers; it is for government and parliament to take any decisions in this area."

Bradshaw must now review the report's conclusions before deciding whether to make any changes to secondary legislation.

Yesterday, shadow culture secretary Jeremy Hunt pledged that the Tories would rip up "dark ages" regulation preventing cross-media ownership to create new conglomerates providing TV and radio services in the UK.