Tuesday, February 17, 2009
Local media ownership review looks at survival of newspapers
THE Office of Fair Trading has today launched its review of local and regional media ownership with a focus on whether existing rules should be relaxed to help the beleaguered newspaper industry.
Competition regulators have begun the review, which was promised in communications minister Stephen Carter's interim Digital Britain report last month, by seeking views from stakeholders on the key media ownership issues to focus on.
The OFT said today the main focus of the review will be on print media. The review will also look at areas including the extent to which regional newspaper markets are self contained either in relation to advertisers or to readership, and the extent to which public service broadcasters, local authorities and other public sector bodies that provide news are in competition with commercial local media companies.
Competition regulators will also look at whether the requirement for a sufficient plurality of views in newspapers in each market in the UK is realistic, or desirable, in the digital age.
Regional newspaper and commercial radio executives have been calling for the government to relax ownership rules as their businesses come under increasing pressure from the double whammy of the recession and the rise of the internet hitting ad revenue.
A relaxation of ownership rules could pave the way for more consolidation in the regional print sector and for newspaper publishers to buy more local radio stations.
"Local and regional media is an important part of the economy, which is currently subject to a range of pressures," said Amelia Fletcher, senior director of mergers at the OFT.
"Initially we are asking for views on the key issues the review should focus on. Following this we will engage in detail on how the current media merger regime is operating in both protecting competition for relevant audiences and advertisers, and maintaining media plurality," Fletcher added.
The review will be handled by a steering group made up of senior officials from the OFT, media regulator Ofcom, the Competition Commission, and the Department for Business Enterprise and Regulatory Reform.
A full discussion document on the review will be issued in mid-March. The OFT plans to complete the review by mid-April, and submit findings to government to fit the timescale for the publication of Lord Carter's final Digital Britain Report, which is due in early summer.
David Newell, director of the Newspaper Society, the body that represents regional publishers, said: "The NS welcomes today's announcement that the OFT is reviewing the local and regional merger regime within the timeframe of the Digital Britain report. It is helpful that the government has specifically asked for the review to examine a number of the main issues which the NS has been asking the government to address as a matter of urgency."
Newell added that the priorities were diversity of competition, need for clear competition authorities guidance on specific local media mergers and the extent to which public service broadcasters and local authorities constitute competition to independent local media.
"We look forward to the opportunities that Digital Britain will give regional and local media companies to enable them to develop public service content across all media platforms including regional TV news," he said. "We will meet with the OFT and Ofcom this month and will respond to each of the review stages between now and its completion in mid-April."