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Is it possible to save traditional media companies in the face of the twin threats of a digital revolution and the recession? That question has not only been asked with increasing urgency over the past couple of years, it has stimulated plenty of answers too.
But the current Government has not taken action, despite those proffered answers, which have been endlessly repeated by the concerned owners of newspapers and commercial broadcasting outlets.
Now the Conservative Party, which has revealed precious little of its concrete policies should it form the next government, has made its own proposals crystal clear.
Jeremy Hunt, the shadow secretary for culture, media and sport, will make a speech at the Manchester media festival tomorrow in which he will list a set of changes that he believes necessary to transform the current bleak outlook for media.
In what he has characterised as a “big bang” revolution, he will say that cross-media ownership rules, which prevent locally based companies from owning more than one newspaper or radio station in a defined geographical area, should be abolished.
This, by coincidence, chimes with an announcement yesterday by the media regulator, Ofcom, that it too recommends a liberalisation of cross-media regulations, though it stops short of abolition.
Ironically, Hunt will also say that Ofcom's wings should be clipped in order to prevent it from making just that kind of policymaking statement. It should be left instead with the responsibility for making judgments about taste and decency, and certain specific matters, such as overseeing the way ITV sells its airtime and the amount of time it grants to advertising.
Hunt lays the blame not with the regulator itself but its responsibility to carry out the terms of the 2003 Communications Act. This required it, he says, to micro-regulate.
In other words, Hunt is taking a free market stand by arguing for deregulation, believing that it will stimulate activity. He told me: “The danger of current regulation is that it means, in local areas, a newspaper can only ever be a newspaper. It cannot develop on to another media platform. Yet the consumers can glide happily from platform to platform. We have been throttling local media.”
He believes that the rules, drawn up at a time when there was concern about a single media owner forming a local monopoly and thus reaping an advertising harvest, have not kept pace with the rapid changes brought about by digital technology.
Now, as we all know, advertisers have been able to choose online alternatives to papers and broadcasters. So those companies have been losing revenue without the capability to innovate across the various media platforms.
Let's take a hypothetical case. At present, Trinity Mirror, the current owner of Liverpool's two major papers, cannot acquire the commercial TV and radio outlets in that city.
It is suffering from falling advertising revenue and falling sales at those papers, and its only way of stopping the rot is to cut costs. If it were allowed to buy up the competing TV and radio interests — and this is, I stress, an imaginary scenario — it might well turn round its fortunes. Similarly, of course, Liverpool Radio City's owner, Bauer Media, could do the same by buying out Trinity's titles.
This would have been anathema in the past, and I would certainly have opposed it. But the situation has changed, as Hunt rightly argues.
New digital competition is eating traditional media for breakfast because it does not need to be located in any given region to secure advertising. Then there are the people who can launch locally-based start-ups from scratch with relatively small — indeed, almost negligible — overheads.
Traditional media companies, by contrast, have their hands tied. That's why companies as different as the publicly quoted corporate owner Trinity Mirror and the Scott Trust-owned Guardian Media Group (for which I write a media blog) have both lobbied hard for change to the rules.
So far, then, so good for the Tory alternatives to the current state of play. What about the contentious matter of the BBC's licence fee?
It would appear that there has been some misunderstanding about Hunt's intentions in this area. It has been reported that he intends to announce that an incoming Tory Government would freeze, or even cut, the licence fee when it comes up for renewal from 2010.
He says that there has been no such decision, choosing his words carefully by saying that “in the current climate it is difficult to argue for an increase”. I fear that amounts to the same thing.
However, the BBC's director-general Mark Thompson may be somewhat heartened by Hunt's response when I asked him: “Do you like the BBC?”
Unhesitatingly, he replied: “I'm a fan of the BBC. When I go abroad, I find that most people in other countries wish they had a BBC.
“I do feel that it's an overmanaged organisation and that too many of its executives are paid too much. And, as a free marketer, I'm bound to say that if it didn't exist, you wouldn't think of setting it up in its present form. To paraphrase a French philosopher, it works in practice, but does it work in theory?”
Hunt is not saying that his proposals will definitely become policy. Instead he says: “See them rather as statements indicating the direction of travel, hopefully to start a debate and to check that there's nothing I haven't spotted.”
So let the debate begin, though it's hard to disagree with much of what he says, is it not?
Roy Greenslade is Professor of Journalism, City University London
