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The Earl of Onslow: However, it is not banned by law from so doing. That is the point I am making. I should hope that everything could be considered on a public interest basis rather than being banned by law. That is the difference and it is exactly what my noble friend has highlighted.

Lord Inglewood: I am grateful to my noble friend for elaborating that point. Because of the Radio Authority's important remit to secure variety in local radio formats, the market remains artificially structured, albeit far less regulated than the corresponding television one. Arguably, that means that there is still a need for checks on the further growth of dominant players in a particular area. If the existing rule is overturned, such groups would be able to buy their only significant competitors in their locality. In addition, new entrants to the radio market who seek to provide different services would be forced onto the inferior AM waveband, diminishing their effectiveness as competitors with existing companies and reducing the prospect of greater diversity.

We should also not forget that the Government are already providing the larger radio companies with substantial opportunities to grow. Last July an order increased from 20 to 35 the number of licences that any one company may own. That limit is removed entirely by the Bill. During the Second Reading debate I made clear that the Government are as yet unpersuaded by proposals to abandon the overlapping areas rule. That remains the case. If these amendments were to be accepted we believe, like the noble Lords, Lord Thomson of Monifieth and Lord Chalfont, that they could threaten plurality at local level, undermine competition in the provision of services, and inhibit the promotion of diversity. It is for those reasons that we are opposed to these amendments.

Lord Desai: I am grateful to those Members of the Committee who have spoken to this amendment. I am especially grateful to the noble Lord, Lord Chalfont, for informing me of the technological details of this matter. I remain convinced that there is confusion here as

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regards the notion of monopoly and competition. If we consider, for example, the larger metropolitan areas where--as the Minister said--there are a number of competing radio stations, those areas are referred to as the A and B types of area. In that case, if an existing large producer acquired another station that would not necessarily reduce competition because much competition already exists. If, however, there are areas in which there is only one dominant producer and that dominant producer acquires another FM channel, that again in my view does not reduce competition. The technology of radio is such that one can always move the dial and obtain a broadcast from the next area. It is not as if one is confined to listening to the station in one's local area.

I could understand anxieties about a monopoly situation if there were no substitute easily available, or if the substitute were costly. If I may say so to the Government, we are discussing an old fashioned view of monopoly and competition. If they had read their Professor Hayek carefully, they would be reassured that it is not difficult to have competition provided there are substitutes available. There will not be dominance because people can always turn the dial and turn to a station in another area. That has been the case in the computer industry where IBM was a large player but it faced competition from small minnows. Diversity is not the issue either because, as I pointed out, if there are several players they tend to offer the same kind of broadcasts. They all offer "gold" broadcasts. Therefore, the situation is contrary to what the Minister thinks it is and it is contrary, somehow, to common sense. Common sense is wrong in this respect. I urge the Minister to think about this matter and I am grateful to him for saying that he will return to it on Report. In the light of that good discussion--

The Earl of Onslow: Before the noble Lord sits down, I shall now confess to a frightful piece of peeking. In looking over the shoulder of my noble friend on the Front Bench, I see that he has an alternative reply. Everyone will say that it is unfair to do that and I admit that is cheating, but I cannot resist it all the same. His alternative reply states that in view of the feeling expressed in the House he will go away and--

Baroness Trumpington: This is quite intolerable, even from one of my noble friends. I ask my noble friend to sit down.

The Earl of Onslow: I do not see that it is intolerable. Where in the Standing Orders does it state that one should not quote from a brief? Let me just finish the point I am making. The only noble Lords who have spoken on the Government side are two who have done so on behalf of the Radio Authority. I am not asking the Government to agree to the amendment. I am simply asking the Minister perhaps to choose the second of the alternative replies in front of him.

Lord Boyd-Carpenter: I really must protest at my noble friend's attitude in looking over and reading from

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the Minister's brief. This is contrary to the normal good manners and standards of this Chamber. I hope that he will now apologise.

Baroness Trumpington: I do not know whether the noble Lord, Lord Desai, had finished his remarks but he was interrupted in the middle of his speech.

Lord Desai: An interesting discussion is taking place. Therefore I shall try to find out what the discussion comprises before I do anything further with my amendment.

Lord Inglewood: There are all kinds of things that I have notes on--that applies to what we are discussing today and on previous occasions when we sat in Committee on this Bill--which I deemed not appropriate to mention. Whatever the noble Earl may have thought that I had written in my notes, what I said was what I meant to say.

Baroness O'Cathain: Like the noble Lord, Lord Desai, I am grateful to all Members of the Committee who have taken part in this debate. The comments of the noble Lord, Lord Chalfont, worried me because he said that if the aim of the amendment was to put "gold" on FM, that would not be achieved. Obviously I shall have to reconsider that matter. I understood the noble Lord to say--I do not know whether I understood him correctly--that that is because of the limitation on the number of FM bands, or at least space on the FM band. Obviously I shall have to look at that matter again.

I am also grateful to my noble friend Lord Colwyn, who suggested that the authority should consider proposals on their merits and not condemn them outright. When my noble friend the Minister spoke he raised my hopes because he said that he intended to revise the restrictions and to revoke the 1991 order in its entirety. However, he then stated that, on the advice of the Radio Authority, there would be no change to the AM and FM wavebands. That does not encourage me at all.

People are talking about competition and monopoly. The reality is that there is already competition. If there were not an increase in competition, with a greater number of FM bands being given to independent radio stations, there would be a greater monopoly by the BBC which, I remind my noble friend the Minister, has four FM wavebands in each geographical area. We are looking for competition in the independent radio sector, which competes with the BBC, although not for advertising. Perhaps I did not make that point clear.

I reiterate that if the radio company were allowed two bands, that would provide greater diversity. The second FM band would not compete with another news station or current hits stations but with an easy listening station.

Therefore, the market is not the monopoly that many Members of the Committee seem to think it is. The dominant player in any area is always the BBC. I shall withdraw the amendment and look forward to hearing what will be said at Report stage, when I shall probably return to the matter. In the meantime, I beg leave to withdraw the amendment.

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4.30 p.m.

Lord Desai: The Minister should remember that small radio stations, no matter how cuddly and lovely, will not survive. If there is to be new technology, one has to build up a few major players. Radio does not have highly capitalised companies. Even in companies such as Capital Radio the capitalisation is about £400 million.

We ask that the spirit of the other part of the Bill be extended to radio. Have confidence and courage and one will be all right. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 62 agreed to.

Lord Thomson of Monifieth had given notice of his intention to move Amendment No. 144:

After Clause 62, insert the following new clause--

Community service licences

(".--(1) Section 84(2)(a) of the 1990 Act is amended as follows.
(2) After "restricted service")" insert "or--
(iv) for a defined locality and operated for the benefit of the community, or a particular section of the community, by a non-profit distributing body (a "community service").".").

The noble Lord said: Amendment No. 144 and the following amendment deal with the future of community radio, a matter on which we had some discussion in relation to amendments moved last Tuesday. We may wish to return to the issue at Report stage, but in view of the pressure on time I shall not move the amendments.

[Amendment No. 144 not moved.]

[Amendment No. 145 not moved.]

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