16. Memorandum submitted by the Independent
This memorandum is prepared by the Independent
Television Commission (ITC). The ITC is responsible under the
Broadcasting Acts for the licensing and regulation of all commercial
television in the UK, with the exception of S4C. In addition,
the ITC has no responsibility for those BBC services funded by
the licence fee. The Members of the ITC are appointed by the Secretary
of State for Culture, Media and Sport and include a National Member
for Wales. There are at present 10 Members, under the Chairmanship
of Sir Robin Biggam. The ITC has an office in Cardiff led by the
ITC Head of Wales and the West.
ITV IN WALES
ITC licences all the regional ITV companies
including HTV. This company uniquely holds a licence to provide
services to two parts of its region, Wales and the West of England.
The present licence runs for 10 years from 1 January 1993; the
company successfully bid for that licence, promising an annual
cash payment to the Treasury. At the time of the bids the company
also put forward programming proposals which were incorporated
in its ITC licence. Even though ultimate ownership of the company
has changed, following its acquisition by United News and Media,
these requirements remain at the level prevailing before the take-over.
They include requirements to broadcast certain types of programme,
in effect introducing an element of public service broadcasting
to the commercial network. In particular, HTV Wales must provide
a national service which reflects the diversity of life within
Even though the licence has several more years
to run, HTV have applied under the Broadcasting Act to apply for
its renewal for 10 years from 1 January 1999. (10 other licensees
have exercised the same right). A business plan has been supplied
to the ITC on a confidential basis and is now being analysed.
In the course of November, we expect to announce revised terms
for the renewed licence, involving a new sum to be paid to the
Treasury. HTV may reject these terms if they consider them unacceptable
and reapply for licence renewal on one other occasion in the next
two years. This process is entirely concerned with the financial
terms on which the licence is granted. It is the ITC's responsibility
to offer renewal terms, which are in the ITC's view, what the
licence would fetch, were it to be put out to open tender. Calculations
will take into account HTV's business plan but under the terms
of the statue it is the ITC's view which must prevail, ie licence
renewal is not a matter of negotiation.
It is important to stress that this is renewal
of the existing licence; before applying for licence renewal,
HTV agreed several changes to their original licence and the financial
terms put forward by the ITC will reflect these revisions.
The fourth channel in Wales is allocated to
S4C which broadcasts around 30 hours of Welsh language programmes
per week in peak viewing hours, supplemented by programmes from
Channel 4 provided free of charge. Channel 5's coverage is limitedfrequencies
on which the service could be carried were not found. NTL CableTel
operates services in South Wales, and the ITC has recently awarded
a local delivery franchise for North Wales and South Cheshire
to Metro Communications Ltd.
The digital age is now upon us, with the launch
of digital services on three platforms, satellite, cable and terrestrial.
These digital services will be able to carry far more channels
than existing analogue services and dedicated channels for niche
interests are likely to be a feature. It is, for example, already
possible through analogue cable systems to receive the Parliamentary
channel. The possibility of this sort of broadcasting is opened
up even more by digital broadcasting. No one single digital platform
has universal coverage. There will be areas of Wales which will
not immediately be within the reach of digital terrestrial transmissions.
Whilst we are delighted that a cable company is now investing
substantially in cable operation in North Wales, it is unrealistic
to believe that cable services will cover the entire country because
of the economics of laying it in rural areas.
The initial transmission plan for digital terrestrial
television encompasses only 81 transmission sites throughout the
UK (nine in Wales), compared with the 1,000 or so (more than 200
in Wales) currently employed for the analogue transmission of
BBC1, BBC2, Channel 3 and S4C or Channel 4. The ITC is studying
ways in which digital terrestrial coverage can be extended beyond
this initial plan, so that it might eventually match as closely
as possible the near-universal availability of analogue. One new
technique we are investigating for this purpose is microwave transmission.
The ITC has recently sent a paper to Government
outlining that it should be possible to increase the coverage
of digital terrestrial television to match the near-universal
coverage of current analogue terrestrial services, if it is not
possible to do so beforehand, once the analogue signal is switched
off. The ITC has offered to work with the Government in devising
such a plan, but this is a development for the long term as the
ITC does not see much prospect of analogue switch off for 15 year
or more. It is vital that viewers, wherever they are in the country,
continue to receive their much valued free-to-air television services.
The ITC regulates all commercial digital television
services (ie, non-licence fee funded), with the exception of S4C's
digital service which will be launched in November 1998. We are
responsible for licensing the services and for ensuring that content
meets our published Codes; we will continue to foster regional
broadcasting. We submit an Annual Report each year to Parliament
via the Secretary of State which sets out the performance of ITV
licensees and those on other main terrestrial channels. We would
also be happy to discuss with the Assembly or its Committee any
points concerning the regulation of broadcasting about which it
had an interestin the same way as we appear before Select
Committees of either House of Parliament.
The Government of Wales Act makes no provision
for any change in the ITC's role in Wales. We look forward to
working with the new Welsh institutions to ensure a constructive
and positive relationship.
26 October 1998