LONDON — Hollywood may soon have a chance to own commercial TV stations in what has hitherto been a largely insular market — the U.K.
Last week the government said it would throw out regs next year that prohibit American and non-European Union companies from owning TV and radio licenses.
That means Rupert Murdoch’s ambition of controlling a British terrestrial TV station could move a step nearer (cross-media ownership rules would also be relaxed, further paving the way for the media mogul).
Under the just-published bill, the BBC and Channel 4 would be excluded from foreign ownership because they are government-backed. But Murdoch could bid for Channel 5, the U.K.’s last commercial terrestrial network.
Other companies, like AOL Time Warner or Walt Disney could bid for either Channel Five, or the more established and more lucrative ITV franchise, presently split by U.K. companies Granada and Carlton Communications.
In a sop to critics of Murdoch’s already substantial position in British media, the bill will continue to block anyone with more than a 20% stake of the newspaper market from acquiring ITV, Blighty’s biggest commercial terrestrial broadcaster.
This stricture rules out Murdoch, who owns four leading national newspapers but would not affect any of the other Hollywood majors.
Non-European Union companies also will have the right to buy TV licenses in the U.K. for the first time.
Significantly, it was not clear whether the other proposed changes would give American media companies the go-ahead for takeovers.
“It makes no sense that French, Italian or German companies can hold licenses but Australian or Canadian ones can’t,” Media Secretary Tessa Jowell said in explaining the proposals.
Another rule that the government plans to do away with in this round of legislation, which will also set up super-regulator Ofcom spanning broadcasting and telephony, is the one that prevents single ownership of ITV.
This will pave the way for a merger between Granada and Carlton, subject to competition law.
That issue has been around for several years and is more pressing than ever since the pair lost around $1.4 billion on their failed pay TV service, ITV Digital, which shuttered two weeks ago.
To the House of Commons last week, Jowell added: “For too long the U.K.’s media has been overregulated and overprotected from competition.
“Despite this, the last 10 years have seen a dramatic increase in the range of voices in the marketplace. The draft bill we have published will liberalize the market, so removing unnecessary regulatory burdens and cutting red tape, but at the same time retain some key safeguards that will protect the diversity and plurality of our media.”
Another feature of the bill, which runs to 260 clauses and is likely to become law in the fall, is the essentially unchanged role of the BBC’s governors who, despite the creation of Ofcom, will continue to be responsible for overseeing content issues.