Digital Britain preview: A new era for British journalism?

Digital Britain is an ambitious attempt by the government to chart the future course of the UK’s communications and media industries.

Compiled by communications minister Stephen Carter, it will tackle issues such as universal broadband and pave the way to help cash-strapped broadcasters and newspapers.

It was reported at the weekend that the BBC will be forced to give up some of its £3.6bn public funding in a massive shake-up of the licence fee.

Lord Carter is to propose “top-slicing” the corporation’s budget by up to £130mi to help under-pressure ITV and other programme makers, according to the Sunday Telegraph.

His White Paper could also call for Channel 4 to receive financial support through a partnership with BBC Worldwide, the corporation’s lucrative commercial arm.

Under the reported proposals, up to £100m of the BBC’s funding could be used to pay independent companies to make regional news programmes for ITV.

And another £30m of licence fee money could be made available for producers to make current affairs documentaries to be viewed either on television or on the internet.

Andy Burnham, who was replaced as culture secretary by former BBC employee Ben Bradshaw less than a fortnight ago, said of the Digital Britain report in a Broadcasting Press Guild briefing with journalists: “The likelihood is that legislation will have to follow in fairly short order.”

He said that if parliament did not act quickly it would do a “serious disservice to the creative industries of this country”.

The public service broadcasting sector has been looking at ways of partnering up in a bid to save money.

Commercial broadcasters have been hit by falling advertising revenues as well as an explosion of digital channels.

Burnham has said: “I think that Digital Britain will plant some very powerful ideas and seeds that will have the potential to be further shaped. Further discussion, further partnership will emerge.”

Burnham described the BBC as an “enabling force in the land” and ITV as a major investor in original British programming.

He also reiterated the importance of having local and regional news beyond the BBC as an “absolutely firm commitment”.

A plan to transfer existing FM radio stations to digital broadcasting, DAB, was also outlined in the interim report.

Car manufacturers would be encouraged to make DAB radios standard in new vehicles under the plans..

The Department of Culture, Media and Sport (DCMS) is joint sponsor of the Digital Britain report along with the new Department for Business, Innovation and Skills (BIS).

It was announced on Friday that Lord Carter, a former PR executive and adviser to Gordon Brown, will quit his post and leave the Government next month.

Here are some of the issues today’s report is looking to address:

BBC

The BBC’s publicly-funded position has come under increasing scrutiny as its commercial rivals struggle in the recession.

Concerns have also been raised about the possibility of the BBC ending up as the sole regional news supplier.

Last month a Conservative bid to freeze the licence fee for a year was defeated in the House of Commons. An annual licence for a colour TV currently costs £142.50 a year, and is due to rise by £3 next April.

The Tories argued that the BBC needed to provide more for less in tough economic times.

The corporation’s current 10-year charter runs until 2018, while the six-year licence fee deal runs until 2013.

Last week it was disclosed that the BBC was planning pay cuts of up to 40 per cent for some of its highest-earning stars.

The corporation has set out various partnership proposals, including sharing its technology and expertise with other broadcasters.

ITV

In October, ITV’s executive chairman Michael Grade suggested that his company could hand over responsibility for regional news to another organisation.

Media regulator Ofcom has also suggested that ITV’s regional programmes, which are produced as part of its public service broadcasting requirement, could be cut to help it save £40m a year.

ITV and the BBC have already signed a memorandum of understanding in a bid to deliver cost savings for regional news on ITV1.

The two organisations have been discussing ways in which they could work together, including co-locating the ITV and BBC regional news centres and offices in England and Wales, sharing technical facilities and resources and pooling some video.

But Ofcom chief executive Ed Richards has warned: “The BBC’s partnership proposals are very welcome, but on their own will not deliver a viable news service on ITV, nor will they address the wider challenges faced by regional and local news and journalism.

“The cost savings they deliver, especially early on, are relatively modest.

“And in television they are dependent on ITV changing the scheduling of its services.”

He said urgent action was needed to ensure the BBC did not become the only supplier of national and regional broadcast news as the current system had become unsustainable.

New opportunities for regional TV news

Ofcom has advocated the creation of independently-funded news consortia as a long-term replacement to ITV regional news.

Richards said that failure to take action would be a “historic missed opportunity”.

He said Ofcom’s news consortia recommendation would involve each consortium operating independently and meeting the distinctive needs of its region or devolved nation.

At its most basic, the new set-up could act as a straight replacement for existing provision, costing £40m to £60m, Richards said.

An enhanced service, which could include a new network of news consortia based on smaller regions, could cost £60m to £100mi.

Richards suggested that money could come from any digital switchover surplus after 2012.

The licence fee

Surplus cash before 2012 has been identified as possibly being used to aid the provision of universal broadband.

But last month, BBC Trust chairman Sir Michael Lyons said the body must guard against “opportunistic” attempts to siphon off licence fee money for projects which have nothing to do with the corporation’s public purposes.

He said that as far as the BBC Trust was concerned “returning any surplus to licence fee payers is the benchmark against which any other proposal should be judged”.

Channel 4

Meanwhile, Channel 4 chief executive Andy Duncan told the Culture, Media and Sport Committee last month that an initial agreement about a partnership deal could be reached with the BBC within weeks.

He said that both the channel and BBC Worldwide, the commercial arm of the BBC, were enthusiastic about forming a “headline” understanding of how the deal would work.

But newspaper reports over the weekend have suggested that a BBC/C4 deal has not been signed in time for today’s Digital Britain report.

Channel 4 plans to cut its programming budget by at least £60m in the next year as it battles to cope with rapidly falling revenues.

The broadcaster has said it expects income to fall by 18 per cent in the first half of 2009, representing “the thick end of £100m”.

Asked if he was concerned that the move could make the BBC even more dominant, Duncan said that areas of synergy would not create more dominance and one aspect being looked at was ploughing more money back into Britain from the rest of the world for British content.

Local newspapers and radio

The final Digital Britain report will include the findings of an Office of Fair Trading investigation into the media ownership rules governing local newspapers and radio.

The OFT has looked into whether these rules should be relaxed, paving the way for consolidation and asset swaps.

Regional newspapers argue that the current rules are too onerous as they look at newspapers as a contained market, ignoring the effect the internet and other media are having on their businesses.

The radio industry will also be looking today for guidance on the path to a digital switchover.

Former GMG Radio chief executive John Myers has also provided the Digital Britain policymakers with an independent review of localness in radio, in which he recommended further relaxation of the local content rules.

This could lead to more consolidation and a rethinking of the local radio map, but Myers also stressed the importance of continuing to provide quality local news on radio.

PressGazette.co.uk will have full coverage of what the Digital Britain report means for journalists from 3.30pm today.

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