Page last updated at 09:51 GMT, Thursday, 9 October 2008 10:51 UK

What price for regional TV news?

By Torin Douglas
Media correspondent, BBC News

ITV
ITV is planning to reduce its regional news services

ITV is cutting more than 400 jobs in its regional newsrooms and has suggested it could hand over its regional news production to another organisation.

The BBC is moving 3,000 regional news staff into its main News division, bringing them closer to its national and international news teams.

With regional newspapers facing more possible closures and job losses, it will amount to the biggest shake-up in news outside London since ITV was launched as a network of regional companies in 1955.

The moves follow an unprecedented level of debate in recent months over news coverage of the UK's nations and regions.

The Scottish Broadcasting Commission has called for a publicly-funded Scottish TV channel, which the BBC Trust wants improvements in network news coverage of Scotland, Wales and Northern Ireland.

For once, executives in London are considering issues beyond the M25 very seriously.

Money-spinner

Not so long ago, regional news was a money-spinner for ITV. Its early-evening bulletins used to win more viewers than the BBC's - except in the corporation's heartland of London and south east England - and gave the regional companies a strong platform to build audiences throughout the evening.

It reinforced ITV's strong local identities - through the likes of Granada, Yorkshire, and Scottish Television - and proved popular with MPs, who liked appearing on their local bulletins.

But these days, ITV sees regional news as a financial burden - one of the "public service broadcasting" (PSB) obligations which lose money it can no longer afford.

Michael Grade
Michael Grade said regional news was being subsidised by ITV

Media regulator Ofcom has accepted its case for merging some regions and shedding regional news staff, in order to ensure it can fund its national and international news service.

Now ITV's executive chairman Michael Grade has gone further.

Responding to Ofcom's PSB proposals, in a speech to the Royal Television Society, he said in the long term ITV could not guarantee to provide a regional news service because it lost money and was, in effect, subsidised by ITV.

The company needed to be put on a straightforward commercial footing and not seen as "an arm of social and industrial policy".

Public service

Mr Grade said ITV also subsidised the commercial TV companies in Scotland and Northern Ireland (which it does not own) by paying more than its fair share of ITV's network programme budget.

That subsidy was worth 25m a year and could not continue much longer, he said.

ITV has still not decided if it wants to remain a public service broadcaster, with all the costs and obligations that entails. Its board must inform Ofcom of its decision in the next few months.

Mr Grade said the "non-PSB" option - in effect, to become a straightforward commercial broadcaster like Sky or Virgin - was "very attractive".

Channel 4, meanwhile, is seeking some form of public subsidy to help it maintain its PSB obligations - perhaps by taking a slice of the licence fee, part of which is currently ring-fenced to pay for the government's digital switchover help scheme.

Even if ITV does continue to hold a PSB licence, Mr Grade would not seek public money to help it pay for regional news as it would bring with it the burden of even more regulation, as politicians demanded accountability.

London Tonight
ITV has 17 regional newsrooms but intends to reduce this to nine

If government bodies - in Westminster, Glasgow, Belfast or Cardiff - decided public funds should be used to subsidise regional news, he would not want the money to go to ITV.

Instead, he's floated the suggestion that in the longer term a publicly-funded third party could produce news for the nations and regions, carried by ITV - via its regional transmitters - to ensure it reached a sizeable local audience.

He said one potential supplier would be ITN, which currently provides ITV's news, but the Press Association or Reuters would be possibilities.

BBC shake-up

Meanwhile, the BBC has begun a major shake-up of its nations and regions coverage, prompted partly by criticism from the BBC Trust.

The division overseeing it all - BBC Nations and Regions - is being disbanded, and from next April the controllers of Scotland, Wales and Northern Ireland will be promoted to director level, as members of the BBC's decision-making Direction Group.

There'll be a new UK Forum, meeting twice a month, to discuss issues outside London.

In England, there'll be a new post of Director, BBC North, to head the move of key departments to Salford, where a new state-of-the-art digital broadcasting centre will house the BBC's sport, children's and future media departments, as well as Radio 5 Live.

And the 3,000 staff who currently work in the English regions, most of them in journalism, will become part of the BBC's News division.

The director of BBC News, Helen Boaden, has told staff the idea is to improve editorial collaboration and strengthen the BBC's journalism, rather than making savings.

At a time when ITV is withdrawing from the regions, which were once its greatest strength, the BBC could be seen to be filling the gap.

But Ofcom and the government have made it clear the BBC must not become the only supplier of regional news. Plurality is the buzzword of the moment.

And commercial rivals - TV, radio and newspapers - are concerned that the BBC is becoming too powerful locally, particularly in the expansion of its online activities.

They are opposing plans by the BBC to launch new local video services, saying this would harm their own fledgling online ventures. Ofcom and the BBC Trust are currently examining the plans.

No one can say London is ignoring the nations and regions at the moment.




SEE ALSO
ITV 'could outsource region news'
08 Oct 08 |  Entertainment
ITV News planning to cut 430 jobs
30 Sep 08 |  Business
Analysis: Ofcom's regional news proposals
25 Sep 08 |  Entertainment
ITV 'can cut' regional programmes
25 Sep 08 |  Entertainment
ITV to merge regional newsrooms
12 Sep 07 |  Business

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