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COMMUNICATIONS should be subject primarily to competition law and free of regulatory intervention except where public interest principles are at stake, said the ITC’s Chief Executive, Patricia Hodgson.
Delivering the annual ITN, European Media Forum (EMF) lecture, she said: “We should be reluctant to regulate, preferring competition and as much certainty for business as possible.”
She said communications markets tend to be characterised by a few large players, who control networks and gateways, and give preference to their own services rather than allowing competitors to reach the consumers. She added: “If access terms are right, the underlying structure of the market needn’t concern us. Competition can do its work.”
Turning to broadcast standards, Hodgson said that competition is a necessary but not sufficient condition for the range, quality and standard of broadcasting society expects. Without it, we would not have a booming new media sector, serving a wider range of interests better than ever before.
Hodgson said that spending on landmark programmes, such as ‘History of Britain’ or ‘Touch of Frost’, depended on attracting large audiences, something best achieved so far by “national networks with the privileges of free or cheap spectrum, special places on programme guides and well established brands”.
Britain invests a great deal in public service broadcasting. They devote a bigger share of resources to their public service networks, to BBC1 and 2, ITV and Channels 4 and 5, than any other nation.
“If you add the BBC licence fee together with the opportunity cost of spectrum and of commercial schedules that don’t only chase ratings," she said, "Britain maybe subsidising public service to the tune of £3.5 to £4 billion a year in broad terms. Are we getting the cultural return we have a right to expect, as tax payers as well as viewers and listeners?”
Hodgson said public service broadcasters should be free to manage their own businesses but regulation “should keep them honest” and added that the ITC had developed three initiatives to simplify this part of regulation to ensure it was effective.
Firstly, the ITC had undertaken research into what audiences say they want from public service. Secondly, licensees had been asked to prepare rolling annual statements of how they deliver their public service remits. And, thirdly, the ITC would report back on what the licensees say in the context of audience judgements and an objective, fact based assessment of what the industry as a whole offers audiences.
With this amount of public money being spent, accountability is a key area of concern, Hodgson said: “We can and should rely on broadcasters to manage their own business, providing they’re accountable; providing there’s independent and objective data to keep them honest, and providing over time, if remits aren’t met, there are effective powers to ensure they are.”
The BBC would, as they are now, be the basis of the system and BBC1 the core. “The BBC must provide a sure foundation if public service is to survive. Guaranteed public funding makes that possible. When we decide to mould the market, that’s where we should begin”.
The ITC’s Chief Executive concluded by saying that Ofcom would need to manage the tensions between supporting competition and delivering public service objectives. She said these were “decisions for citizens and their representatives. To duck them would leave a democratic deficit. Parliament must establish its priorities. Ofcom’s role is to apply them.” (CD)
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