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Viscount Astor: My noble friend has just made a rather convincing argument for an amendment; but I am not sure that his argument is relevant to the amendment moved by the noble Lord, Lord Thomson of Monifieth. This amendment is not about new technology or anything like that. It is simply about ownership. It seeks to amend the ownership schedule which deals with the 20 per cent. rule. I am sure that all of us consider that we do not want large concentrations of ownership in either the broadcasting industry or the newspaper industry; nor do we want an overlap of such a high concentration as to cause us concern.

The noble Lord, Lord Thomson, in effect asked, "Why 20 per cent.?" The answer is, "Why not?" because 20 per cent. is the percentage that we have lived with, as the noble Lord explained during the 1990 Act. Therefore, I do not accept the noble Lord's argument about unfairness arising to those with a market share of 21.1 per cent. as opposed to 19.9 per cent. It may be said that that is unfair but everybody, whatever side of the divide they are on, knows what the rules are. I do not think that it is sustainable to argue that there should not be a percentage rule because of that.

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The Bill rightly says that broadcasting is special in this country. Broadcasting is not like any other industry. It has an influence on our society and nation which is out of due proportion to perhaps any other industry. I am sure that the noble Lord would agree with that. Therefore, in drawing up the Bill I think that the Government were right to say that there must be some restrictions on what is a fair percentage. I think that the Government got it exactly right with 20 per cent. because that will stop undue concentrations of newspaper ownership affecting television. It will allow plenty of people to operate in the market. Therefore, with great respect to the noble Lord, Lord Thomson, I do not think that his amendment is right and I hope that my noble friend will resist it. I am sure that he will have a convincing argument for doing so.

Lord Wyatt of Weeford: At a previous stage in this Committee, I referred to my interest in News International and News Corporation. If any noble Lord would like me to recite those interests again, I am happy to do so. They did not arise because of my membership of this House; I had them long before I became a Member of your Lordships' House.

I should like to support the amendment which I think provides a fair and sensible arrangement. Some things about News International have been forgotten. First, it has no regional newspapers, and so when one says that it has an undue proportion of readership of newspapers in this country, that is untrue. It is in fact in a small minority. Again, it has no consumer magazines which are widely read by all manner of people. News International has only 40 per cent. of Sky. It is a minority shareholder. It may be that Mr. Murdoch is an active 40 per cent. shareholder, or representative of that shareholding, and that is no doubt to the benefit of BSkyB, but it has only 4 per cent. of this country's TV audience. So it can hardly be said to be a monopoly, or that it should be restrained from competing, for example, with the BBC which has 44 per cent. of the country's viewing audience.

I do not want to labour those points, but it is clear that the Bill as framed is unfair to anyone who happens to be concerned with News International or News Corp. On reflection, perhaps the Government will consider accepting the amendment.

Lord Desai: Perhaps I may ask a general question in relation to the amendment. It relates to the relationship of the Bill to the Fair Trading Act. Why do we need conditions to be laid down in the Bill? Why cannot we just trust the Fair Trading Act to take care of the matter? There are concentrations of ownership. We have a mechanism under which the Office of Fair Trading can proceed. I ask the question out of curiosity, because I am somewhat confused. Why do we need to lay down these limits?

Lord Colwyn: I regret that I find the whole issue of the 20 per cent. rule bizarre and difficult to understand. For a start, I believe it to be unnecessary. A public interest test has already been expressly, although perhaps not perfectly, drafted into the Bill with the issue of cross-ownership between newspapers and broadcasters. It

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is clear that that would suffice whatever the size of the newspapers involved. Why is the 20 per cent. rule there if a public interest test operates already? Its existence is artificial. I hope that this afternoon we shall not become part of a commercial battle.

Noble Lords opposite will try to change the 20 per cent. to a 25 per cent. rule in their Amendment No. 156E. Conveniently, the Mirror Group would then be excluded from its application. The reasons for any proposed change are not clear. Could it be that News International already has satellite TV so it deserves to be treated roughly? But the Mirror Group already has cable TV with its subtle and intellectually challenging news bunny. As far as I am aware, the Mirror Group is, and always has been, free to enter the satellite world as well.

The 20 per cent. rule business is a nonsense. I ask the Committee to look at its implications. Just two companies are affected by it as it stands at present--the Mirror Group and News International. It is the ownership of popular newspapers that they have in common that causes them to deserve this stigma.

If the 20 per cent. rule becomes the 25 per cent. rule, News International only is affected because of its ownership of the Sun. In fact, any owner of the Sun would be caught because of its circulation. Effectively, we should be punishing the Sun for being too good. It may not be my cup of tea; it may not be that of Members of the Committee. So its circulation figures are not our fault, but nor are they the fault of the owners. They are, I am afraid, the fault of the readers.

Successful circulation figures would thus keep News International out of mainstream TV which all other newspapers can get into. Perhaps the Mirror Group has thought of that too. It cannot make sense for a newspaper group to have to get its circulation figures down below a threshold to avoid this absurd success penalty. Unless steps are taken to get a newspaper's market share down to below 20 per cent., one can still buy only 20 per cent. of one ITV company. It is all very different if one has 19 per cent. That is about the total market share of every British national broadsheet paper--dailies and Sundays--put together.

If one has 19 per cent. one can buy TV companies up to an overall audience share of 15 per cent. I am not sure whether that is in line with the Government's views on plurality. But let us remember that it is no longer a share of one company; it is a share of the total television audience. That makes a huge difference.

One percentage point more and one has the automatic imposition of these strict limits slapped upon one. One percentage point less and one can have a substantial newspaper and television business.

There are many companies with huge media interests which will not come within the 20 per cent. rule, because the combination of media which they own happens not to offend that rule. Pearson or the Daily Mail, to name but two, are excellent and successful companies, but just because their interests are spread around all the different sectors of the great media market far more widely than News International--magazines, regional newspapers, terrestrial channels, and cable

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radio--they are not subject to these whimsical and arbitrary rules. They will be subject only to the public interest test just like everyone else.

Even the live TV news bunny would find it hard to smile if the 20 per cent. rule disappears. It is unnecessary, unfair and inefficient. I hope that my noble friend will consider the amendments carefully. They would treat everyone equally and allow the MMC to apply a public interest test. At the same time, I hope that when the amendments tabled by the noble Lord, Lord Donoughue, come up, we shall reject them.

5.45 p.m.

Lord Harris of High Cross: As I have not had an opportunity previously to take part in debates on the Bill, I have to declare a direct interest in the matter as one of the six independent national directors of Times Newspapers which is a subsidiary of News International. In that role, my responsibilities relate to five titles only--The Times and the Sunday Times and the three educational and literary supplements. I suspect that were they to be produced by the BBC they would be described as an example of public service publishing. Yet the circulation of those five papers, for example, contributes towards the market share that rules out, as the noble Lord, Lord Thomson, said, News International from certain capabilities in the broadcasting field.

I find myself in total agreement with the noble Lord, Lord Desai, who said that these matters can be left to the ordinary processes of fair trading, the MMC, and all of that. I strongly oppose the noble Viscount, Lord Astor. He seemed to say that we should perpetuate controls and restrictions. He did not quite come to the rationing of newspaper readership into the indefinite future.

At later stages, if there is an opportunity, I might refer to an extensive piece of research conducted in 1994, I think, by Arthur Andersen, which had a sample of 30,000 for some parts of the survey. It looked at the average time devoted by people to watching television, listening to the radio, and reading newspapers. That is a single market for information, news, entertainment and so forth.

The conclusion was that watching television occupied 60 per cent. of the average weekly time devoted to those activities; listening to radio accounted for 28.5 per cent; newspapers, in total, took 9 per cent.; and magazines a mere 2 per cent. We are becoming too excited about the modest role played by newspapers--dominance, press barons and all that stuff--which reflects the old party political knock-about which I was so glad to hear the noble Lord, Lord Thomson of Monifieth, scrupulously avoid.

As I said in my original remarks, my contribution to this debate relates to my experience during the past six or seven years as an independent director of Times Newspapers. The Times is run wholly separately and independently under its editor and the board has no regulation. The job of an independent director is to ensure that the editorial process is wholly removed from proprietorial pressure. The same applies to the Sunday Times and the three supplements under their editors.

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I have not mentioned the Sun. Ownership of the Sun alone would put any newspaper publishing company beyond the pale, according to the noble Viscount, Lord Astor, because the Sun, over which I have no influence or control, has more than a 20 per cent. share of the national readership. Indeed, the Daily Mirror titles have more than a 20 per cent. share. I strongly support the amendment tabled by the noble Lord, Lord Thomson.

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