APPENDIX 24
Memorandum submitted by the Newspaper
Society
The Newspaper Society represents the regional
newspaper industry. Its members publish over 1,300 regional and
local daily, weekly and Sunday newspaper titles, both paid for
and free, throughout the United Kingdom.
NEWSPAPER MERGERS
AND TRANSFERS
As the Committee is examining the prospects
for a draft Communications Bill and developments in policy since
the Committee's previous report, we assume that the Committee
will include consideration of the Government's consultation paper
on media ownership rules. The Newspaper Society is currently consulting
its members and will be submitting a full response to the DCMS/DTI.
We hope that these preliminary comments are helpful to the Committee's
considerations.
The newspaper industry believes that the newspaper
transfer regime must be radically changed. The Newspaper Society
has consistently argued for abolition of the special controls
that uniquely bind the newspaper industry. We are pleased that
the Government's consultation paper acknowledges the burdens of
the current regime and its unnecessarily restrictive nature, including:
— The significant costs imposed upon
the industry, despite only three refusals in the 172 cases considered
during the past 21 years.
— The particularly disproportionate
burden placed upon the acquisition of local newspapers.
— Absence of any refusal of any transfer
on freedom of expression grounds and lack of any evidence that
the regime has had any clear significance in the preservation
of day to day freedom of expression.
— The clear commercial advantage that
parties which do not fall into the definition of existing UK newspaper
publishers enjoy, since they can complete any deal without waiting
for prior regulatory clearance.
— The burdens of criminal sanctions
combined with prior consent requirements, in addition to the sanction
of a null and void transaction.
We are pleased that the Government is considering
whether prior consent, criminal sanctions and controls over all
titles and newspaper assets need to be retained and how to introduce
fair competition between all prospective newspaper purchasers.
Despite these advances in Government policy,
the regional newspaper industry is very concerned by its intention,
as advanced in the consultation paper, that newspaper companies
mergers and transfers should continue to be treated as a special
case. This contrasts with the Government's attitude to other media.
Under the consultation paper's proposals, consolidation of the
broadcasting media will be made easier, and local authorities
and advertising agencies would no longer be prohibited from ownership
of radio and television. The benefits of broadcasting consolidation
are recognised, while general competition law and increasing competition
from other media are thought to address adequately any competition
problems or plurality concerns.
In contrast, the consultation paper proposes
that newspapers are still to be subjected to a special regime,
perhaps involving OFCOM, in addition to both the Competition Commission
and appropriate Cabinet Minister. The Society has already expressed
its deep reservations about the consultation paper's proposals
that OFCOM, a body originating from broadcasting and telecom regulators,
assume any role in relation to newspapers and we re-iterate the
industry's strong opposition to such a body assuming control over
ownership and/or content of the printed press or its websites.
The Society has consistently argued that general
competition law alone ought to apply to newspaper transfers. Any
new regime must at least be deregulatory. It ought not add or
complicate regulatory hurdles, nor handicap existing newspaper
transfers which are not subject to the current regime. It must
be put in place at the same time as any deregulation of other
media. This remains the regional newspaper industry's view.
CROSS-MEDIA
OWNERSHIP
The industry is very disappointed at the failure
of the consultation paper to advance any detailed proposals for
reform of cross-media ownership. The Newspaper Society supports
further liberalisation. In respect of local and regional newspaper
cross media ownership of local and regional radio stations, the
Society has previously advocated abolition of the current public
interest test, contended that the BBC must be taken into account
and argued against any stricter limits being placed upon regional
newspaper companies' ownership of regional and local radio stations
or other media, including digital radio multiplexes.
The consultation paper is silent on the BBC.
It will apparently remain free of the regulatory constraints that
control publishers' cross media activities. The diverse and multi-media
pursuits of the BBC, licence funded and commercial, provide strong
competition to local and regional newspapers' editorial and commercial
activities. The development of online services and onset of digital
broadcasting will increase such competition yet further. The Communications
Bill and regulatory authorities must give greater consideration
and weight to the BBC's effect upon local and regional plurality
and competition.
OTHER ISSUES
The Newspaper Society's representations on past
and present EU and UK legislative initiatives on intellectual
property have emphasised the crucial importance of publishers'
intellectual property rights. The Society felt that the Copyright,
Designs and Patents Act 1988 achieved a satisfactory regime for
the newspaper industry, in respect both of ownership of copyright
and fair dealing exceptions that together enable both day to day
journalism, production and publication of newspapers and underlie
future investment in and development of the content industries.
The Society would be happy to provide any further
comments or information that the Committee might find helpful.
10 January 2002
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