Bargaining chip in media meltdown

ITV’s slow decline is well known and the broadcaster revealed the extent of the reduction in its advertising revenue this week. There is already a UK-wide £40m “regional savings” programme in the pipeline, that will be completed by 2009.

Although Wales is not at the front of the queue to completely lose regional coverage from ITV it will be hit very considerably as investment through ITV Wales is reduced: with a virtually non-existent ‘national’ press, no independent radio stations based in Wales and coverage from UK-wide media outlets that is ‘patchy’ at best.

Michael Grade, ITV executive chairman, warned this week that ITV’s £1bn programming budget could be reduced unless regulatory burdens are removed. The IWA has already identified a problem with other figures from ITV: Ofcom, the regulator, produced a spend per head figure for ITV, based on a private ITV submission in 2006. Ofcom said ITV’s spending in Wales per head was £4.30. Given the number of heads in Wales this equals about £12.9m. However, at the Assembly’s Broadcasting Committee Michael Grade said the entire cost of ITV Wales’ operations was “just over £9m”. Yet, Ofcom has already accepted in principle that ITV’s claim that its public service broadcasting costs will exceed the benefits by 2009.

Having a viable alternative in Welsh broadcasting to the current channel 3 licence arrangement is a vital bargaining chip as Wales secures plurality in broadcasting. A plan to give Channel 4 extra investment through BBC Worldwide has already been dismissed. The BBC denies the ‘excess licence fee’ that Ofcom has identified exists.

The BBC Trust chairman said in May 2008: “Some observers have spotted the BBC’s fund to help elderly and disabled people get the benefits of digital switchover and come up with the bright idea that, once switchover is complete, this fund can be used for other purposes. What they don’t seem to have noticed is that the fund will have been spent by the time the current licence fee settlement expires, and who knows what will happen to the licence fee after that?”

There are already other ideas on the table for Wales. Ron Jones, chairman of Tinopolis, has suggested a Welsh Public Service Broadcasting agency. Another possibility is to have a separate channel 3 licence for Wales. However, any licence holder(s) would still probably need public funding to survive. These options warrant fuller examination from Ofcom – and further debate in Wales.

Also within Uncategorised