MediaTel

Former BBC director general Greg Dyke has suggested that local TV could be commercially viable in 60 areas of the UK.

Speaking at the University of York last night, Dyke said local TV could be "cheaper to run than [Nicolas] Shott believes, that it could attract more local advertising than Shott believes, and that, arguably, the interest in local news and local features is greater in smaller cities and towns".

The Local Television Advisory Committee, which Dyke chairs, submitted a 40-page report to culture secretary Jeremy Hunt with its findings and suggestions yesterday.

Dyke's report follows the (different) recommendations of merchant banker Nicholas Shott, who was commissioned to complete a review of the commercial feasibility of local television services last year.

In his final report, which he submitted to Hunt before Christmas, Shott warned that fewer than a dozen local TV services may be viable in the short term, broadcasting no more than two hours of locally-produced content a day.

Shott also advised that local TV services would only work with a national "backbone" to fill the rest of the schedule and attract viewers, extensive cross-promotion on other channels and a prominent position on the EPG. He also said the services should be underwritten by a £15 million-a-year advertising contract from an existing broadcaster such as ITV or Channel 4.

However, Dyke claims Shott was too cautious."While my group welcomes his report and some of his recommendations, we think he doesn't understand the potential in cities like York, where there are 200,000 inhabitants and another 200,000 in the hinterland," Dyke said.

The LTAC report suggests that local television could be delivered in smaller markets for £500,000 a year.

Shott told Media Week today that his group did a "very thorough and exhaustive analysis" and took an appropriately cautious view. He added: "If Greg Dyke's more optimistic assumption turns out to be correct, then I would be delighted."

Hunt's plans for local TV services have instigated much debate.  On Newsline, Raymond Snoddy wrote an article titled 'Local TV... is Jeremy Hunt serious?' back in September, which suggested that "there might be fundamental economic reasons why this sector has not flourished, or even managed to establish itself at all in the UK."  In response, Robert Kenny, MD at Human Capital, said: "Local TV has a high hurdle to clear to reach profitability, and with waning consumer interest and increasing competition for ad revenue the bar is getting higher all the time."

A week later, Jim Marshall questioned the commercial viability of local TV - unless, of course, "the government is willing to cough up", he said.  However, to Hunt's credit, Phil Redmond of MerseyFilm said in places like Liverpool, the ethos of local TV has been alive and well for a great many years.