Shake-up of laws on media ownership

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The Independent Online

Chief Political Correspondent

A radical shake-up of the rules governing cross-media ownership is to be announced next month by Stephen Dorrell, the Secretary of State for National Heritage. In an unrelated move, Mr Dorrell is also laying plans to open up seven new digital television channels.

Recent speculation about impending changes to the cross-media ownership rules have suggested that Mr Dorrell will do no more than tinker with the restrictions which stop national newspaper groups owning more than 20 per cent of any ITV company.

Many leading figures in the media industry have argued that these limitations are weakening Britain's media companies in the face of foreign competition and have argued that total ownership should be determined by a system of points which assess each company's share of the entire media market.

A ministerial source said: "Dorrell will be proposing the more radical option that regulation will move towards an open system of market measurement of the sort proposed by the industry, that market share should be assessed by points. He is not going to replicate that system exactly, but he is going to allow the market to breathe."

It is not clear how tight the new limits will be and whether they might require any exisiting media owner to divest any of its interests.

"The real test of whether these proposals are justifiable is whether they promote plurality of ownership and quality of content," said Chris Smith, Labour's Shadow National Heritage Secretary. Labour will also be pressing the Government to preserve the regional identity of the independent broadcasters.

Mr Dorrell wants the legislation to change the existing rules to be announced in the Queen's Speech in November. His plans for digital television are expected to be set out in a consultation document in late June.

The plan is to offer up to seven digital frequencies for use by new television stations, alongside the existing four channels and the planned Channel Five.

There has been a bitter behind-the-scenes battle by existing broadcasters to hang on to the extra capacity created by the digital revolution, initially in order to provide digital versions of BBC and ITV services.

Digital television technology allows a number of TV services to be transmitted on the band width currently required for one conventional TV channel.

The Government is concerned to strengthen the industrial performance of the British media sector which it regards as one of the country's more promising economic assets.

Mr Dorrell will today establish within the Deptartment of National Heritage a new unit to nurture the media industry.

Mr Dorrell will be urged by the cross-party Commons select committee on National Heritage tomorrow to adopt the idea of tax breaks for film makers to attract more of them to Britain.