1. A new future for Local TV in the UK? Kate Stross, Ofcom Director of Content Lokalrundfunktage 2010, July 7th 2010

2. A new vision for local television “I have long believed that the lack of high quality local TV is one of the biggest gaps in British broadcasting.” Jeremy Hunt MP, Secretary of State for Culture Media and Sport 8 June 2010 1

3. The starting point 2 2

4. The existing channels Wholly commercial channel owned by Guardian Media Group. Now on digital terrestrial, cable and satellite. But programme plans significantly scaled back in 2010 Community model supported by grants from regional and educational bodies. Mix of professional (mainly freelance) labour and volunteers. Emphasis on training Privately owned channel aimed mainly at ethnic Asian community in Leicester. Strong links with broadcasters in India to source content Small scale service run on semi-amateur basis. Contains local news and sport. 3 3

5. Why has local TV not developed further in the UK? No public subsidies available for local TV Thriving local media sector dominated by newspapers and local radio Scarcity of suitable analogue spectrum for local TV – and low level of take-up for cable alternatives Restrictions on local TV licences - short terms and low-power transmissions 4

6. UK has well-developed system of regional TV Map of ITV TV regions Map of BBC TV regions 5

7. High quality regional TV supported by “PSB compact” for commercial licensees Near monopoly in TV advertising made ITV regional franchises a “licence to print money” (attrib. Lord Thomson of Fleet 1958) Broadcasters competed to win licences by making significant public service commitments – including regional programming But resulting public expectation of high quality TV programming may have harmed prospects for low-budget alternatives 6

8. Digital TV and the internet have changed the economics for ITV Millions Ranges between higher and lower values based on current best estimates Cost Benefit of PSB status for the Channel 3 network Source: Ofcom 7

9. Consumers value local and regional content – especially news % saying local and regional content is very important - weekly users Scores based on respondents importance rating 9/10 on a scale of 1-10. Source, Ofcom research PSB Review 2008/9 8

10. The emerging ambition By 2015, credible city-based local network of stations established and broadcasting news and other content on television and online Content produced and broadcast on a commercially sustainable basis News and content relevant for local audiences contributing to plurality and democratic purposes Community engagement and contribution to media skills and training 9 9

11. The economics for fully commercial local TV are challenging Only London and Manchester could support stand-alone commercial stations in UK advertising conditions (based on achieving a 1.5% audience share) Cumulative loss for all 15 cities is (£2.8m) Source: Oliver & Ohlbaum study for Ofcom 10

14. Opportunity to develop local multiplexes carrying a number of services11

15. Television regulation measures that might improve prospects for Local TV 12

16. Other factors which could help 13

17. Next steps.......... Over the next 12 months Government will examine the economic, technical and regulatory measures, costs and consequences of the various options Government has already appointed an independent advisor to build the economic case for Local TV Ofcom will provide specific technical and regulatory advice, including in relation to:- Spectrum issues/DTT capacity issues Content regulation Licensing 14

18. Kate Stross, Ofcom Director of Content 15