| The regulatory context
Ofcom's duties
In the carrying out of its functions, Ofcom is required to secure "the maintenance of a sufficient plurality of providers of different television and radio services." There are essentially two approaches to achieving this duty:
· Measures which are defensive in nature, and prevent actions taking place which would reduce media plurality. These include the existing regulatory framework governing media mergers, media ownership and broadcast standards.
· Positive mechanisms to promote media plurality—such as the current PSB obligations secured in return for implicit subsidies (as set out in Annex 3). These are likely to be particularly important in circumstances where the desired level of media plurality may not be commercially sustainable, and include the provision of news by public service broadcasters.
Media mergers
Currently, certain mergers may be subject to intervention on media public interest grounds. There are threshold tests based on turnover and share of supply or demand, but there is no requirement that turnover be generated from the "public interest" activity; nor that the supply of goods or services which triggers jurisdiction be the supply of goods or services which raises the public interest concern.
There are two "plurality" media public interest considerations: plurality of views in newspapers and plurality of persons with control of media enterprises.The statutory definition of "media enterprise" does not include providers of internet content or wholesalers of broadcast content who do not hold the broadcast licence.
A public interest review of a merger is triggered by an intervention notice issued at the discretion of the Secretary of State. He needs reasonable grounds to suspect that a specific public interest concern may be "relevant" to the merger.
If the intervention specifies a "media" public interest consideration, Ofcom must report to the Secretary of State on whether, having regard only to the public interest consideration he has raised, it is or may be, the case that the merger may be expected to operate against the public interest. Competition assessment takes place separately.
Once Ofcom has reported in accordance with the intervention notice, it is for the Secretary of State to determine whether or not the merger should be referred to the CC for further review of plurality concerns and, if necessary, consideration of remedies. Once the CC has reported, the final decision on whether there is a plurality concern and, if so, on remedies overall is for the Secretary of State.
Since the current framework was established, there have been media public interest interventions in only two cases: Sky/ITV and News Corporation/Sky. In both cases, the public interest consideration concerned was "the need, in relation to every different audience in the United Kingdom or in a particular area or locality of the United Kingdom, for there to be a sufficient plurality of persons with control of the media enterprises serving that audience".
Controls on media ownership
The main remaining ex-ante statutory restrictions on media ownership are:
· The "20/20 rule". This prohibits a newspaper group with more than 20% of national newspaper share from holding a Channel 3 licence or a stake in a Channel 3 licensee that is greater than 20%.
· To prevent or restrict TV/radio licences being granted to particular types of person whose influence might cause concern (e.g. advertising agencies).
· To require Channel 3's appointed news provider not to be excluded by the above rules, and to be suitably well remunerated.
Broadcast standards and the role of impartiality
Broadcasters licensed by Ofcom are subject to the Ofcom Broadcasting Code (the "Code") which among other things requires both due accuracy and due impartiality of television and radio news. The BBC is subject to its own Editorial Guidelines—as Section 5 of the Code that relates to accuracy and impartiality does not apply to services funded by the licence fee. As set out in the Code: ""Due" is an important qualification to the concept of impartiality.
"Impartiality" itself means not favouring one side over another. "Due" means adequate or appropriate to the subject and nature of the programme. So "due impartiality" does not mean an equal division of time has to be given to every view, or that every argument and every facet of every argument has to be represented. The approach to due impartiality may vary according to the nature of the subject, the type of programme and channel, the likely expectation of the audience as to content, and the extent to which the content and approach is signalled to the audience. Context … is important."
In our PIT report, we said that impartiality cannot be measured precisely and broadcasters have a degree of editorial discretion in the selection of the news agenda. There could be cases where deliberate exclusion of stories could potentially be a breach of the Broadcasting Code. However, in practice, the partial selection or omission of news stories would be a subtle one which it could be difficult, through regulation, to identify and/or prove. The rules would not necessarily prevent an individual with control of a media organisation from influencing the news agenda through the selection or omission of stories.
We recognised that the impartiality rules may contribute as a safeguard against potential influence on the news agenda by media owners, but they cannot themselves necessarily ensure against it. The regulatory framework, while relevant to the plurality of news and, hence, the statutory public interest assessment, does not on its own ensure a sufficiency of plurality of news. This was the position adopted by the Competition Commission in Sky/ITV.
Positive obligations on public service broadcasters
The public service broadcasting framework acts to ensure certain levels of content provision, including news, by the BBC and other public service broadcasting.
Ofcom regulates Channel 3, Channel 4 and Channel 5 through licence conditions intended to promote the fulfilment of the purposes of public service television. Licence commitments are currently focused on meeting public service purposes in a small number of core programming genres regarded by audiences as the most important (in particular news and current affairs).
In return, the licensees receive specific benefits. These include the right to appropriate prominence on Electronic Programme Guides ('EPGs') as well as access to spectrum that enables them to make their services available to 98.5% of the UK population on the digital terrestrial platform.
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