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Wednesday, 20 June, 2001, 15:29 GMT 16:29 UK
Communications Bill on back burner
By the BBC's media correspondent Nick Higham

There are some things governments simply find too difficult.

One of them, it seems, is devising new rules on who can own how much of Britain's media, or deciding to abolish the existing rules altogether - especially when Rupert Murdoch, one of the world's biggest media barons, is involved.


The whole issue of the media ownership rules has proved too difficult and too politically sensitive to resolve

The expected Communications Bill - involving the creation of a new super-regulator for the communications industries and establishing new rules on cross-media ownership - has been downgraded to a "draft" bill, to the disappointment of commercial TV and radio companies.

That means it won't now reach Parliament in its final form until after the next Queen's Speech, in the autumn of 2002 - and a new Communications Act is unlikely to get Royal Assent until mid-2003 at the earliest.

'Paving bill'

Since the government (in its pre-election manifesto for business) promised the new super-regulator, Ofcom, would be up and running by the end of 2003 this is a pretty tight timetable.


Commercial TV and radio companies are said to be outraged at the delay

One option now being discussed is apparently to introduce a "paving bill" to set up Ofcom on shadow lines, with a budget, a chairman and staff but without the power to take decisions, some time in 2002.

The main bill has been scuppered by a combination of factors.

One, quite simply, is that it has slipped down the government's list of priorities.

It was the state of schools and hospitals, not the future of the media, which dominated debate during the election campaign, and the 20 bills flagged up in the Queen's Speech reflect that.

Too difficult

Another factor is that ministers have changed. The new Culture Secretary, Tessa Jowell, and her junior minister for the media, Kim Howells, will take time to read themselves in.

Rupert Murdoch
Rupert Murdoch would like media ownership rules changed
But the main factor seems to be that the whole issue of the media ownership rules has proved too difficult and too politically sensitive to resolve.

Commercial TV and radio companies are said to be "outraged" at the delay.

In reality they are mildly disappointed. At a time of fast-moving change in the media industry they would like certainty about where they stand - about who might take them over and about who they might themselves take over.

Instead they are faced with a year of continuing uncertainty. But they are resigned to the political realities.

Scrapped

The government's white paper on communications last year suggested several changes to media ownership rules which won broad support.

In particular, the rules limiting one company to a maximum of 15% of the TV audience and preventing single ownership of the two London ITV licences are to be scrapped, paving the way, in theory, for a single ITV company.


The big TV companies want an end to sectoral regulation of ownership in the media altogether

In practice, however, it's unlikely that the Competition Commission would allow the two giants, Carlton and Granada, to merge.

But in other areas the government has merely promised "consideration" or "consultation".

The commercial radio stations don't know if the present system which limits the share of the radio industry they can control will be scrapped.

Conspiracy theorists

And on the thorniest problem of all - cross-media ownership - the government has put forward no positive suggestions for change.

Existing rules prevent large national newspaper companies from owning more than 20 per cent of an ITV company or Channel 5 and limit local newspapers' interests in local radio and television (and vice versa).

Rupert Murdoch, for one, would like them changed - and was spotted visiting the Chancellor Gordon Brown in Downing Street the day after the election.

Conspiracy theorists immediately assumed he was lobbying for the rules' relaxation. Some go further, and suggest he may prepared to pledge support for the Euro from the anti-European Sun at a referendum in return for concessions on ownership.

The big TV companies want an end to "sectoral regulation" of ownership in the media altogether - get rid of the special rules, they say, and apply ordinary competition law.

Take-over bid

The government is not convinced, believing the media is a special case.

Other media players aren't so sure they want the rules changed either - the radio companies are aware that anything which allowed them to buy local newspapers would also enable newspaper companies to mount a take-over bid for them.

In these circumstances, perhaps it's not surprising that the government has decided it's all just a bit too difficult - and put the whole business on the back burner.

The BBC's Nick Higham writes on broadcasting

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