Ofcom targets change in local radio

By Andrew Laughlin, Technology Reporter

Ofcom has outlined plans to liberalise the rules governing local radio and cross-media ownership to enable all commercial stations in one area to be owned by one firm.

The watchdog today published two consultations on freeing up local media regulations as a way to help the sector respond to the "acute" pressures of declining advertising revenues.

As the trend for consolidation has gathered pace, the watchdog believes that cross-media ownership could be a way for the sector to "respond to these challenges". In response, its first consultation proposes to enable media companies to own combinations of local radio stations, newspapers and TV licenses in one area.

Under its second consultation, Ofcom suggests that existing stations should share resources to cut costs in exchange for freeing up services for digital listeners.

Back in May, the regulator backed a radical overhaul of the way radio is currently regulated in the UK as a response to recommendations by former GMG Radio chief executive John Myers.

In his report, Myers called for urgent action to save local radio from "death by a thousand cuts" as around 80% of the 206 stations serving populations of under 700,000 are either losing money or making less than 100,000 a year.
In July, he also accused Ofcom of being "behind the game" in the commercial radio sector and urged the watchdog to "think bolder and bigger" with its approach to regulation.

In its three-yearly consultation on local media regulation, Ofcom has outlined plans to remove the rules surrounding ownership of local analogue and digital audio services, meaning that "all local commercial radio stations could be owned by one operator in a local area".

Its also proposes to liberalise local media cross ownership rules so that the only restriction would be that one company cannot own 50% of a local newspaper, a radio station and a regional ITV licence all at the same time.
"If adopted, the recommendations could help maintain local content while protecting a choice of services and viewpoints at a local level," Ofcom said in a statement. "They would also reduce the regulatory burden on the local media sector and the radio industry in particular."

Following publication of the Digital Britain report, the regulator's second consultation pledges to "implement a three tier structure for radio which fits not only the existing analogue world but also a future digital world".
In this, it would enable some regional stations to share their programming "in return for providing a version of that station on a national DAB multiplex and in effect enable the creation of new national stations with more significant scale and reach".

The regulator also proposes to allow local stations to "co-locate with other stations within newly defined areas, so helping them to save costs".
Ofcom director of radio policy Peter Davies said: "The central challenge for regulation is to secure the delivery of local radio content, while at the same time ensuring a viable commercial sector, able to adapt to the digital world.

"These proposals are broadly deregulatory, and are aimed at sustaining delivery of local content, increasing choice and diversity of radio services, and ensuring an economically robust commercial sector."
From here, Ofcom will conduct further local media consultations until September 17 before presenting its final recommendations to the government on November 13.