Chapter 6: Summary of recommendations
259. We recommend that a plurality policy should
be limited to the activities of media enterprises engaged in news
and current affairs content. Content diversity in other genres
is not unimportant but is a matter of independent commissioning
or the stipulations set out in licence and Charter renewal agreement
which create the context in which commissioning decisions are
made. (Para 27)
260. There appears to be a strong consensus that
UK media markets should be the focus of UK media plurality policy;
we agree. We recognise that plurality policy remains broadly a
matter for the UK and this report relates to a UK plurality policy.
(Para 34)
261. Any plurality policy approach may take into
account media enterprises based in the UK as well as those outside
UK jurisdiction to the extent that they are consumed by UK audiences
if this is considered relevant to the overall assessment. (Para
35)
262. The scope of any plurality policy should
encompass both local and regional media as well as national media
in the devolved nations and UK-wide media enterprises. In dealing
with local or regional media, those tasked with making decisions
should in reaching their conclusions pay particular attention
to the question of financial sustainability. (Para 40)
263. The BBC should be included in any assessment
of media plurality but it should not be subject to any control
measures imposed from outwith its own regulatory framework as
a result of that assessment. It is for the body which oversees
the BBC, under the existing governance rules this is the BBC Trust,
to ensure that the BBC's conduct in relation to plurality is addressed
satisfactorily. (Para 45)
264. We recommend that media plurality policy
should not be limited by the media channel through which content
is primarily delivered: print, broadcast and content delivered
over the internet may all be relevant, as could be the influence
of digital intermediaries on the consumption of this content.
It should, therefore, be open to an assessment of plurality to
determine which media channels should be in scope based on whether
they are relevant to the overall assessment of plurality at the
time. (Para 51)
265. We recognise the importance of ensuring
that no content provider has an unreasonably high level of consumption
and recommend that a media plurality policy should take into account
both the supply and consumption of content, albeit that any interventions
available will have to be limited in application to the supply
side. (Para 56)
266. We recommend that a media plurality policy
should be flexible enough to take into account both the wholesale
and retail provision of news and current affairs content. It should
establish an approach to determining how to attribute content
to media enterprises operating at different points in the value
chain. This determination will require the location of editorial
control in the value chain to be identified in each case. (Para
63)
267. The framework of plurality assessment and
intervention must strike a balance between providing certainty
to the market and flexibility to the regulator—both are
important. (Para 68)
268. The assessment of plurality should drive
the decision about which remedy or intervention is appropriate,
not the other way around. (Para 69)
269. On the BBC, we think that the proper place
to consider its responsibilities, including with regard to matters
such as internal or external plurality, is within the Charter
Review framework. (Para 90)
270. We encourage the Government and the BBC
in negotiating Charter Renewal to consider whether the BBC might
be given a more explicit responsibility—with respect to
its online offer for news and current affairs content—to
stimulate consumption of diverse viewpoints from different external
sources. (Para 92)
271. We recommend that the Charter Review process
makes clear what licence fee funding is for, and that, as long
as it is conceivably available for projects external to the BBC,
it is also made clear what strategic role, if any, this funding
might play in positively promoting external plurality in the wider
UK media. (Para 94)
272. For our part, we urge the Government to
support our view that the licence fee should be for the BBC alone,
though we do not argue that funding to S4C should now be removed.
(Para 95)
273. The centre-piece of our approach is that
the Government should introduce a statutory periodic review of
the plurality of the media markets to be undertaken by Ofcom on
a 4-5 yearly basis, which will reshape the role for Government,
Parliament, regulator and competition authorities in protecting
the public interest. (Para 196)
274. Ofcom's periodic assessment of plurality
should be based on a limited number of different measures which
address availability, consumption and impact. (Para 199)
275. There should be a role for Parliament in
setting guidance for this new framework of assessment, but the
metrics themselves to be used in assessing plurality should not
be set down in statute. Instead, there should be flexibility for
Ofcom to interpret statutory guidance, design the assessment framework
and select appropriate metrics according to the circumstances
at the time of the review, but with an emphasis, wherever possible,
on longitudinal consistency of the measures applied. (Para 200)
276. The work which the Government intend to
commission relating to the development of a clear measurement
framework should not seek to find a 'right way' of measuring media
plurality which can then be set in stone. Instead its output should
provide Ofcom with a starting point and input to the decisions
it will have to make, at the time of the first periodic review,
about how to design the assessment framework and select appropriate
metrics in a way most likely to balance the twin objectives of
delivering certainty to the market and sufficient flexibility
for a proper assessment of plurality at the time. (Para 203)
277. Ofcom should select the metrics to be used
in a plurality assessment which are most likely to assist it,
given the state of the market at the time of each periodic review,
in reaching defendable conclusions about the following:
· the
sufficiency of diversity of viewpoints available and consumed
across and within media enterprises; and
· the
extent to which any one media owner or voice may have too much
influence over public opinion and the political agenda. (Para
204)
278. The periodic plurality review report should
contain both a narrative assessment of the sufficiency of plurality
in specific media markets and across media; and a clear indication
of where plurality may be under threat, which will guide the decisions
over intervention in the event of any transaction. (Para 205)
279. In producing the narrative description of
the degree of sufficiency of plurality, Ofcom should be able to
rely on new guidance relating to the definition of sufficient
plurality to be set down in statute. This guidance should be qualitative
and descriptive rather than quantitative and tightly prescriptive.
(Para 206)
280. The content of this guidance should be clearly
stated in statute and might include certain key elements such
as a diverse range of independent news voices; high overall reach
and consumption with consumers actively multi-sourcing; sufficiently
low barriers to entry and competition to spur innovation; economic
sustainability and no single organisation accounting for too large
a share of the market. (Para 207)
281. The Government could, as part of the next
phase in their work programme on media plurality, also begin to
develop statutory guidance relating to the meaning of sufficiency
of plurality upon which Ofcom can rely in making an assessment
of plurality at the time of a periodic review. (Para 208)
282. Only in the most extreme circumstances should
interventions in the interests of plurality be imposed outwith
the context of a transaction. (Para 209)
283. Where immediate and pressing concerns resulting
from organic change are discovered in a periodic review, it should
be possible for Ofcom to order a media enterprise to divest. The
bar for this imposition should be high and hinge on a demonstration
of the following:
· That
there is a real problem now;
· That
the specific proposed divestment measure is the only way to remedy
the problem;
· That
the specific proposed divestment measure will be effective in
remedying the problem. (Para 211)
284. Before making the recommendation that a
media enterprise should be ordered to divest, Ofcom must ask those
players affected to submit representations, in which they can
put forward their own divestment measures in lieu of Ofcom's initial
recommendation. Ofcom can then make a final recommendation if,
in light of these representations, Ofcom believes there is a divestment
measure, either of its own or of the media enterprise's design,
able to pass the tests above. (Para 212)
285. The report to result from the periodic review
should be written so as to limit the need for transactional plurality
reviews, by sending very clear signals and guidance to all concerned
about the prospects of consolidation in future possible transactions
before they are formally proposed. (Para 215)
286. Ofcom should publish in its periodic plurality
report any plurality concerns associated with digital intermediaries.
Indeed this might be the vehicle through which Ofcom could on
a regular basis express the UK public's expectations of major
digital intermediaries, as recommended in our previous Report
on Media Convergence. (Para 217)
287. Finally, once complete, Ofcom's report on
the periodic plurality review must be submitted to the Secretary
of State. (Para 218)
288. The process for agreeing a final report
should proceed as follows: The Secretary of State should have
an obligation to accept the content and recommendations of the
periodic review report or publish good reasons for not doing so.
Ofcom should be permitted to submit an amended report in the light
of the reasons given by the Secretary of State but should not
be able to submit a third report. If agreement cannot be reached,
the Secretary of State should have the final say, and accordingly,
if this arises, the Government rather than the regulator should
revise and publish the final version of the periodic plurality
report. (Para 219)
289. The Government should revise the present
system of transactional reviews, in order to clarify the relationship
between competition and plurality policy when dealing with specific
transactions. (Para 225)
290. To that end, plurality assessments and competition
assessments of transactions should be conducted as two distinct
processes, by regulators with the appropriate set of priorities,
expertise, methods and ultimately ethos for each. Competition
authorities should remain responsible for the assessment of a
transaction's impact on competition, but Ofcom should be given
a new statutory responsibility for the assessment of a transaction's
impact on plurality. (Para 226)
291. The plurality assessment of a transaction
should proceed on the basis of a judgement by Ofcom. Right at
the outset, Ofcom will have to form a reasonable belief prima
facie that a specific transaction may be expected to result in
a material and unacceptable lessening of plurality, and that it
therefore merits closer assessment. (Para 230)
292. In reaching a decision about whether there
may be a material and unacceptable lessening of plurality as a
result of a transaction and therefore whether to proceed with
a plurality assessment, Ofcom should draw on the most recent periodic
plurality report, and consider the relevance of any readily observable
changes to plurality in the UK since. (Para 231)
293. In conducting a plurality assessment of
a specific transaction, Ofcom should reach a decision about whether
or not the transaction should go ahead based on an assessment
of the likelihood of its leading to a material and unacceptable
lessening of plurality as compared to a scenario in which the
transaction does not go ahead, taking into account in both scenarios:
· the
sufficiency of diversity of viewpoints available and consumed
across and within media enterprises; and
· the
extent to which any one media owner or voice may have too much
influence over public opinion and the political agenda. (Para
233)
294. The final step in the transactional review
should be the submission of the competition assessment and the
plurality assessment to the Ofcom Board who should be responsible
for reconciling the recommendations of the two reports and implementing
them as a single Public Interest Decision. (Para 234)
295. Where the two reports reach the same conclusion,
the Ofcom Board must be responsible for ensuring the implementation
of the regulators' mutual view either to block or allow the transaction,
but there must be a clear mechanism in place for resolving potential
conflicts between plurality and competition assessments of transactions.
(Para 236)
296. Further, this mechanism should be designed
to resolve such conflicts on the very clear principle that, where
plurality is concerned, the citizen interest should have greater
weight than at present in relation to the consumer interest, and
a democratic and informed society should have greater importance
than at present when weighed against the cost of advertising.
(Para 237)
297. Responsibility for resolving such conflicts
and as such for making a final Public Interest Decision should
therefore be given to the Ofcom Board, rather than the competition
authorities, as at present. (Para 238)
298. The Ofcom Board, mindful of its twin statutory
duties to further the citizen and consumer interest should publish
this Public Interest Decision, having weighed up the merits of
each case and determined whether overall it is in the public interest
for the transaction to proceed. (Para 239)
299. As a whole, plurality policy should be revised
to strike a new balance between the regulator and Government in
terms of decisions to be made about intervention: there should
be accountability for politicians where appropriate but the onus
should be on Ofcom to balance the consumer and citizen interests.
(Para 246)
300. Ofcom's Local Media Assessment (LMA) should
be given greater weight than at present in the competition authorities'
decision about whether to refer a specific local media transaction
onto a full Phase 2 investigation. The competition authorities
should make this change clear in their guidance on mergers, before
the new competition authority, the Competition and Markets Authority,
comes into existence, at present anticipated in April 2014. (Para
250)
301. We note that this recommendation bears a
striking resemblance to one we made in a previous Report, The
Future of Investigative Journalism, paragraph 161. We urge
the competition authorities, in cooperation with Ofcom, to make
greater progress towards implementing this recommendation following
the present Report. Should the competition authorities fail to
act on this recommendation, we urge the Secretary of State to
consider the introduction of a measure by which the relevant section
of the competition authorities' merger assessment guidance would
have to be approved by the Secretary of State. (Para 251)
302. One of the outcomes of Ofcom's periodic
plurality review might be a consideration of whether there is
a case for the more in-depth assessment of media-specific considerations
provided by the LMA procedure to apply more widely to players
in other fragile or emerging media markets. (Para 253)
303. We do not recommend the removal of the "20/20"
rule, but equally would not argue for its retention. Were the
Government to implement a revised plurality policy which lives
up to the principles contained in this Report, there may be a
case for its removal. However, absent such a policy, it remains
a potentially important safeguard which should be kept in place.
(Para 256)
304. The relationship should be clarified between
the public interest and plurality as we have defined it in our
Report and other related but separate policies and interventions
such as licensing, PSB reviews, fit and proper person tests and
so on. (Para 258)
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