Euro Green light for UK State Aid funding for local TV network

Editor | 06-12-2012

The European Commission (EC) has approved proposals for State Aid funding towards the capital infrastructure necessary for the development of the UK's prospective local TV network.

Since elected in May 2010, the UK's Conservative Party, senior members of the ruling coalition Government, has aimed to develop a local TV infrastructure in order to counterbalance what it perceives as a national network that is too metropolitan in nature. The first viability study into local TV was undertaken only a month after the coalition took power, and after a series of consultations and in May 2012, UK broadcast regulator Ofcom invited applications for the first 21 local TV licences, with the first multiplex licence awarded in September 2012.

The UK's Government's Department of Culture, Media and Sport (DCMS) says that following the EC's decision the way is now clear for the Government, under agreement with the BBC Trust, to invest in the capital build of the local multiplex to carry new local digital television services on the UK's Freeview digital terrestrial television (DTT) platform.

The DCMS also expects Ofcom to award before the end of this year the winner of the multiplex licence who will be entrusted with its build. The DCMS added that the approval also gives a green light to the BBC to enter into a funding agreement with the successful multiplex operator, a process expected to be formalised in January 2013 with build-out commencing in early spring 2013. The first local broadcasts are planned for broadcast late in 2013. Somewhat controversially, given the amount of cost-cutting the corporation has undertaken since 2010, the BBC has pledged to provide up to £40 million towards establishing a local television network from the Licence Fee until 2017; up to £25 million will go towards capital costs of building the local TV infrastructure and up to £5 million per year over three years to acquire local content.

In a statement following the EC's approval, the DCMS said: "For the first time there is now a comprehensive framework in place which will provide market incentives for a new generation of local TV services to produce sustainable local content ... The framework the Government has put in place will provide licensed local TV services with access to affordable spectrum and prominence on electronic programme guides. In return for these benefits, local services will be required to provide local content which meets the needs of local people and is more relevant to their daily lives."