Media industry figures are sceptical about Jeremy Hunt's plans for local television, writes Andy Fry.
After six weeks at the Department for Culture, Media and Sport (DCMS), Jeremy Hunt reaffirmed his desire to transform the local media landscape.
In a speech earlier this month, he sketched out the government's vision of a society that 'gives communities greater control over their destinies'. He went on to say: 'For this to happen, we need strong local media to nurture local identity and hold locally elected politicians to account.'
According to Hunt, the UK's current legal framework governing local media, which is overseen by Ofcom, is not geared up to encourage this, so he wants to unleash 'hungry, ambitious and profitable local companies' by shaking up its regulation.
In his speech, he endorsed Ofcom's 2009 recommendations on cross-media ownership rules; these would mean more freedom for local newspapers to consolidate with local radio stations.
At the same time, Hunt plans to settle 'once and for all what needs to change to make local broadcasting viable in the UK' and revealed that he had asked Nicholas Shott, head of UK investment banking at Lazard, to review the potential for local television stations.
This is where Hunt's agenda might come unstuck. For some time, he has argued that the UK should replicate the US, which has numerous local TV channels. Yet, one media analyst is not persuaded the model is transferable, nor that there is real demand for it. 'The US has a genuinely big-scale local TV market, whereas it's hard to see a UK model outside a couple of cities - certainly not the 40 locations the government has talked about,' he says.
Local press trade body The Newspaper Society is also sceptical. Its members have long advocated relaxing cross-media rules, but Trinity Mirror chief executive Sly Bailey sums up the attitude to city TV when she says: 'We don't see it as a viable proposition. Our research suggests the costs are too high and revenues too low to support a business.'
Bailey's scepticism is underpinned by the losses Associated Newspapers made on its London-based Channel One news service and the problems faced by Channel M, The Guardian Media Group's (GMG) local TV service in Manchester. Indeed, Trinity Mirror had the chance to buy Channel M earlier this year when it acquired GMG's regional media division for pounds 44.8m. The fact that it did not is telling.
Matt Payton, head of policy at commercial radio trade body RadioCentre, also welcomes …