Will Hunt's dream of local TV pay off?

Gideon Spanier’s  piece (Will Hunt’s dream of local TV pay off?   ES, 21 Nov) illustrates the confused thinking around Local TV.

Local TV, by definition, is niche TV. Any one Local TV channel will never attract the large audiences of mainstream TV channels.  Local TV has to be built on business models that are completely different from ITV, Channel 4 and the BBC, all of whom have tried (and failed) to deliver Local TV.

Grandiose technically and legally complex schemes involving £40M of licence funding do of course act as a magnet for ‘the big guys’ (many of whom want to try again, where they have failed in the past).  But we don’t need to wait 2 or 3 years while government ‘organises’ Local TV.

Local TV is already happening – without a penny of subsidy or government support.  It’s happening around bottom-up initiatives all over the country.  It can work with local radio or newspaper organisations complementing each other to mutual benefit – in ways which mainstream broadcasters don’t even understand.

Jeremy Hunt would be better advised to inject just  £1M or so into modest support of the rich variety of Local TV initiatives already happening.  Let a thousand flowers bloom, before trying to design, from the top down, some new government-funded species of TV that nobody really wants. 

Fred J Perkins
Chief Executive, Information TV Ltd

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Will Hunt's dream of local TV pay off?

Gideon Spanier  – Evening Standard November 21 2011              

If Jeremy Hunt has his way, London will soon have a new TV channel. The Culture Secretary wants every city and region in Britain to have a local public-service broadcaster to rival the BBC.

Hunt's Department of Culture has already had at least 140 expressions of interest. He has announced a longlist of 65 cities and regions and is set to publish a shortlist of 20 in the next few weeks. The plan is to launch by 2013.

"My vision is of a landscape of local TV services broadcasting for as little as one hour a day," Hunt has said.

Some sceptics think the plan is too ambitious. Hunt says local broadcasters can be largely funded through advertising and commercial sponsorship but the decline of regional newspapers hardly suggests there is much money in the provinces.

Others are more optimistic. Several contenders have been linked with London bids, including Channel 6, led by Richard Horwood, who ran the famously irreverent Live TV for the Mirror in the Nineties; Local 6, which is based at Hammersmith's Riverside Studios and has the support of ex-Channel4 chairman Luke Johnson, and Local Television Network, which has received advice from former BBC director-general Greg Dyke. The London Evening Standard has also indicated an interest.

Horwood argues that if there is one place a local channel might work, it's the capital. "London has a bigger population than Norway and Austria put together," he says.

"There is a lot to be said for all the strong players collaborating - we are very open to collaboration," adds Horwood, who envisages one London channel, with dedicated websites for each part of the city.

There are lots of pros and cons about Hunt's plan. On the plus side, there is £40 million from the BBC licence fee to cover some start-up and transmission costs over three years.

Hunt has also insisted the channel will appear prominently on the Electronic Programme Guide - the list of channels on your TV set.

Channel 6, directly after Channel 5, has been mooted. But Channel 8 - vacant on Freeview in England and Northern Ireland - is more likely. Getting onto cable and satellite platforms such as Sky and Virgin is also essential - Hunt's department is planning legislation to force the issue - but there would be annual carriage fees to pay.

Chris Locke, UK trading director at media-buying agency Starcom MediaVest, says advertisers will be keen on the new local channels. "This offers the opportunity, particularly for retailers with physical regional locations - big and small - to use it as they might local press, radio or outdoor," says Locke. "It means TV becomes a broader church - for more brands than can afford to use TV currently. I don't think this will necessarily attract new media revenues, rather the opportunity is to divert non-TV monies regionally to TV."

On the downside, broadcasting is not cheap. Annual running costs could be as little as £500,000 for a regional channel but London would be far more expensive, especially if it were broadcasting all day.

Another drawback is that it may be difficult to sell advertising at scale as Hunt has dropped plans for a UK "national spine" which all the local channels could join.

Then there are compliance and legal rules set by Ofcom and, in the online realm, by the Authority for Television On Demand.

The big question is will anyone watch? Emma Scott, managing director of satellite TV platform Freesat, ran an ultra-local TV service in Hull for the BBC in 2002. "Certain aspects of it were hugely successful," she recalls. "Some genres, like very local news, weather, sport and drama worked best, but it isn't cheap to do that sort of TV well if you want to retain audience interest." The Hull project lasted only a year.

Rob Woodward, chief executive of STV, which runs the ITV licence in Scotland, has had more success. He recently launched more specialised, regional TV news programmes for Edinburgh and the east of Scotland and for Glasgow and the west of Scotland. News audiences have jumped 17%. "The further you move away from London, the less reliance there is on the BBC," he says.

STV has also introduced 22 hyper-local websites, available only on broadband and mobile, which cover smaller areas. It was not commercially viable to put them on conventional TV - a point Hunt may want to note. The hyper-local sites may seem parochial but Woodward says they are engaging consumers.

He gives the example of STV Buckie, which covers a rural, coastal fishing area. "The number of Facebook and Twitter followers is enormous - 25% of users regularly interact with social media sites using STV Buckie," says Woodward.

Competition will be fierce in London - not least from the BBC, ITV/ITN and Sky News. Everyone recalls that Channel M in Manchester failed to make headway. But London is a bigger, better market. Over to you, Mr Hunt.

Hunt's vision

*20 local TV stations around UK

*Over 140 expressions of interest

*Could appear as Channel 8 on TV electronic programme guide

*Funded by advertising, plus £40 million from licence fee