With the communications bill now inching its way through the House of Lords, a number of highly controversial issues are already forming the focus of debate. Principal among them is the prospect of cross-media ownership of Five, the independent television channel. There is the possibility of a serious rebellion among peers of all parties wanting to secure public service broadcasting safeguards if a large newspaper proprietor were to take over the channel and cross- promote it remorselessly.
But there is another item in the bill that appears to be sailing through with hardly a breath of controversy - as has been the case ever since the proposal was first mooted in the white paper 2 years ago. This is the sweeping away of any specific broadcasting rules that prevent the creation of a single ITV: both the percentage limit and the prohibition on owning both London franchises. Under the bill these will go - and few people appear to be are mourning their passing.
The removal of the broadcasting restrictions does not, of course, eliminate every hurdle that might exist in the process of creating a single ITV entity. Competition rules remain firmly in place and the authorities are carefully weighing up the implications of the proposed merger of Carlton and Granada. It is worth noting that this move would not of itself create a single ITV - Scottish Media Group remains a significant operator - but the newly merged company would dominate the network.
The competition authorities are rightly concerned about the impact a merger could have on the advertising market. Carlton and Granada between them would command over 50 per cent of broadcast advertising. Clearly, if this were in the hands of a single organisation there would be a problem of dominance in the marketplace.
Advertisers are understandably worried. Any competition approval will almost certainly need to require advertising sales procedures to be organised more competitively. The disposal of one sales house might be imposed. This would not necessarily be a bad thing - and would not be a show-stopper.
Provided these concerns can be dealt with by making the necessary advertising arrangements, I believe the merger should proceed; and the desirable objective of a single ITV should then be promoted.
There are two principal reasons to welcome such a move. The first is economic. While the various component pieces of ITV are relatively small, it is difficult for them to punch their weight globally. The BBC is currently our only significant international broadcaster. Even so, because of the quality of what we make, Britain is the second largest exporter of television programmes in the world, way ahead of the rest of the field - but also far behind the US.
A single ITV would be considerably larger, though still small in international terms. It would, however, have a clearer presence and could be more active in selling programmes and formats around the world. Granada in particular is one of the strongest sources of creative programme-making in Britain. Being part of a larger entity with the ITV brand would help it play to that innate strength.
It is not only economic and trading benefits, however, that would flow from a single ITV. There are also important creative reasons for going ahead. At present all ITV programmes are filtered through the ITV Network Centre - ultimately a bartering system of agreeing programme schedules and requirements between the different regions and companies.
However enlightened the management of the Network Centre may be - and on the whole it has been - it is inevitably difficult for bold and daring creative programme decisions to be taken, simply because of the bartering process that must be undertaken. ITV is impeded by its structure from being as creative as it could and should be. A single ITV would solve the problem.
Within a unified creative entity it will still be important to maintain the local diversity of programmes. Regional strengths and characteristics have been part of the glory of ITV since its inception, probably more so than with the BBC. This must be protected. It is one of the reasons regional requirements are clearly set out as an obligation in the communications bill under the remit of Ofcom, the regulator. But you can certainly safeguard regional strength through a robust regulatory power. You do not need a dismembered ITV in order to do so.
The writer was secretary of state for culture, media and sport 1997-2001
By Chris Smith
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