Joint Committee on The Draft Communications Bill Minutes of Evidence

Examination of Witnesses (Questions 940-948)



Anne Picking

  940. You state that "the Government's treatment of regional and local newspapers adversely contrasts with its proposals for broadcast media". Does that mean you do not accept the contention of the commercial radio sector that the greatest burden of the proposed rules on local cross-media ownership falls on the radio sector?
  (Mr Parker) I think we are making two basic points here: the first is that the legislation is proactively promoting consolidation of radio and television and our view, as David has already stated, is that we have a sense that the proposals that are currently on the table are more regulatory rather than less regulatory, which is what we were promised. We cannot miss the point that has been made earlier that the current framework is a single page in the document and yet the new proposals run to two pages, even if we are not yet familiar with the detail of them. So our sense is that, purely from a local newspaper perspective, the proposals as currently framed are more regulatory rather than deregulatory, as we have been promised.

Lord Pilkington of Oxenford

  941. As you know the government is proposing to lift a prohibition on the ownership of broadcast licences, and you are concerned about the potential for government-controlled broadcasting. Do you think your concerns about local authority ownership of broadcast licences could be met through licensing conditions, or do you believe that the existing prohibition should not be lifted? In other words, do you think you could control it or would you like to see the existing prohibition going on?
  (Mr Parker) I think we would like the current situation continue. We are concerned about two aspects on local authorities: one is whether that is the appropriate way in which public money should be dispensed or spent and, secondly, whether a local authority will be able and capable to deal with the potential commercial and other conflicts of interest that may arise between editorial content and any advertising content that that radio station or broadcast media may carry.

  942. So you would like the existing system to continue?
  (Mr Parker) Yes.

Paul Farrelly

  943. I want to extend your logic on newspaper mergers to cross-media ownership. Imagine I am the MP for Cambridge rather than Newcastle-under-Lyme. The logic of your argument is that I should have no concern, there should be no public interest issues involved at all, were the newspapers in Cambridge to be concentrated in one hand along with the local radio stations, leaving just the BBC as the sole independent radio voice. Is that your view? That there would be no public interest in issues arising out of that situation occurring?
  (Mr Parker) No, we are not saying that there is no public interest. I think what we have commented on in terms of the ownership regulations is that, as far as radio is concerned, we have a concern that in some of the market places that we could be talking about it may be impractical to have three radio stations. There are some markets at the moment where there are only two radio stations and, at the moment, local newspaper publishers are allowed to own one of those two subject to a public interest test and we would like to see that continue. As far as the issue of the local newspaper itself is concerned and content, we believe, as others have said before us, that if a local newspaper publisher is not responsive to and is not alive and alert to the needs of its market place, then at the time competition will emerge.

  944. So taking Cambridge as an example, you do see a case in viewing cross-media ownership issues in principle for a public interest test but not purely reflecting newspaper merger issues?
  (Mr Newell) At the moment the position will be, because of the economics of the media industry and the way in which we compete, in particular, for advertisers and the way in which the regional local newspaper industry has developed, that it would be very rare anywhere in the country at the moment in a town such as Cambridge for there to be a number of local newspaper players. Consolidation through economics and for other reasons has already occurred in many areas and has been subject to vigorous newspaper specific merger regime. In nearly all cases, and there have been over 100 in the current regime, the Competition Commission have practically spent more time looking at newspaper transfer cases than at any other sector of the economy in local and regional newspaper cases, and in nearly all cases there has never been a finding on grounds of editorial freedom or editorial content that the mergers should not go through, so we live in the real media world at present that I describe. What the government proposals allow which would not happen at the moment is, if the owner of the Cambridge paper were to buy a very small circulation newspaper on the fringes of Cambridgeshire, the Secretary of State would have the discretion on public interest grounds to trigger a reference mechanism. That is an increase in the application of statutory control rather than a decrease, and the point I was making earlier is that it is of particular concern to small and medium-sized publishers who have to compete with all the other range of media and who also have to survive economically 70 or 80 per cent on advertising revenue.


  945. Can I extend the invitation I mentioned earlier to other newspaper owners? You are clearly attracted by the so-called light touch, less regulation, and that has an appeal but necessarily means a move to self-regulation. Mr Kass made the point that to be successful that form of regulation has to be credible and perceptively credible. Do you have suggestions as to how self-regulation might be framed in order to sustain and also to win, over time, public confidence and, if you do, could you get back to us quite quickly?
  (Mr Parker) As far as self-regulation is concerned as it applies to local newspapers and regional newspapers, we have a fairly flourishing and we believe successful self-regulatory framework through PCC in terms of editorial content and also through the ASA, the Advertising Standards Authority, in the context of advertising.

  946. One of the points that ISBA made is it needs to be demonstrably working. There have been arguments, for example, that the PCC is rather good but that the PCC does not have a great deal of public confidence attached to it?
  (Mr Parker) With respect, we are here to represent the interests of local and regional newspapers. Every single survey that we have ever conducted, either independently or by individual member companies, has pointed to the fact that local and regional newspapers are trusted as a medium more than any other, so we would argue and suggest that that is a reflection of the fact that self-regulation is working pretty well.

  947. I am really offering you an opportunity, which you may decide that you do not want to take, that if you want to move away from regulation to self-regulation, then the onus comes on you to strengthen self-regulation to the point where it gains enormous credibility and confidence, and you may be right in terms of the area you specifically represent but I am challenging you and saying that if you want to avoid regulatory creep, then there is a moral obligation on you to look at your own self-regulatory practices and say, "Look, not only are they working but, year on year, we have strengthened them".
  (Mr Parker) Yes.

  948. May I ask the Bill team whether there are any questions on the move from the de minimis area from circulation to a rather more complex formula?
  (Mr Metcalfe) The provisions on de minimis would align the new regime with the general merger regime being incorporated into the Enterprise Bill and are similar to the general merger de minimis provisions in the current Fair Trading Act.

  Chairman: Are there any other questions that have arisen as a result of the evidence? If not, thank you all very much indeed.

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