How local TV became a curious relic
As London Live seeks a buyer, Raymond Snoddy looks at how Jeremy Hunt's US-style local TV project has been bypassed by history
The time may have come to try to collect on a bet made with the then Culture Secretary Jeremy Hunt on the future of local TV.
The terms of the bet were unfortunately a little imprecise and would certainly not meet the exacting standards of William Hill.
But over a glass or two of wine at a Channel 4 party he predicted that local television would be a huge success and create a new form of television in the UK along the American model.
If it turned out not to be so, he would stand this very sceptical journalist a slap up dinner.
The terms were clarified to the extent that mere survival with the help of an imposed BBC subsidy of £40 million for the new sector would not be enough to qualify as a bet-winning effort.
Local television would have to be able to stand on its own two feet and make a meaningful contribution to local news and local programme production once the subsidies had ended.
The news that Evgeny Lebedev, owner of the London Evening Standard and The Independent, is in talks to sell the London Live local television station is as good a moment as any to formally announce that Jeremy Hunt’s big idea has been a failure.
The station has never made a profit in what should be a lucrative London market and has accumulated losses of more than £30 million since it went on air five years ago.
If you cannot make it in London with the help of journalism from the Evening Standard and The Independent and your broadcasting infrastructure all provided by the BBC, really you cannot make it anywhere.
The viewing numbers are simply too small to attract advertisers, as was widely predicted at the outset, and there are other more cost-effective local media - radio and still, despite obvious difficulties, local newspapers. Not least the modestly profitable free Evening Standard.
Any growth in the advertising market has been hovered up by social media, leaving local TV as a curious relic bypassed by history even though it is less than eight years old.
For Lebedev, the theory was that a new stream of revenue from London Live would help to underpin the Independent and the Evening Standard.
It has turned out to be precisely the other way round with the TV station having to be jettisoned to avoid dragging down the other now profitable companies.
A year ago former Culture Minister Ed Vaizey announced the local TV initiative had been a failure and that the Government should “pull the plug.”
The failure of local TV is not just a business failure amid the lack of any sign that a sustainable sector can be created in future. It is a failure of the very concept of local television itself in the UK.
London Live and the other licenced groups around the UK have been visiting Ofcom on a regular basis to have their local programme-making obligations reduced repeatedly to the absolute minimum. Some would say almost to the vanishing point.
Presumably, Ofcom has taken a pragmatic decision that it is better to have something, however modest, rather than be held responsible for seeing them go to the wall.
To the extent that there is any business at all, it is one based on being able to broadcast on a prominent place on the dial blocks of bought-in cheap programme repeats supplemented by sometimes barely local news.
London Live has been allowed to get away with calling old films from Ealing Studios local London content.
Hunt’s complete misjudgement of the size of the opportunity was then compounded by a blinding piece of arrogance.
He rejected alternative ideas suggesting an unashamedly populist national channel which would sell national advertising, and that would fund local franchises, which could then provide truly local news.
It was a bit like a poor man’s ITV, and still might not have worked, but there might at least have been a slight chance.
The Culture Secretary decided that this was too top down an approach and wanted local television to rise from the bottom up.
Like many politicians Hunt has continued to rise before the mess left behind in previous departments becomes fully apparent and politicians never ever admit that they have got something wrong.
One can only hope that his reform of the NHS was better thought out than his local TV plans, before leaving for the Foreign Office and now lining up for a possible crack at replacing Theresa May.
Meanwhile back at the local TV roots, the company that, according to The Guardian, Lebedev has been talking to - That’s Media - has already scooped up 20 local licences.
Most of the rest is in the hands of a rival consolidator, Made Television, now rebranded as Local Television which has also in the past talked to Lebedev and London Live.
Last year, in a detailed investigation, BuzzFeed looked at That’s Media and alleged that the main point of the company was to collect subsidies from the BBC by submitting 85 local stories a month from each of its areas at £147.50 a time, netting several million pounds.
It is unlikely that any are of high enough quality to be used by the BBC and amount to a pointless political drain on the BBC’s programming budgets.
BuzzFeed said the items were being produced by tiny teams of one or two young under-trained staff on zero hours, minimum wage contracts. The website added that some of the stations were getting fewer than 30 viewers across the day.
The acquisition of London Live would give That’s Media much greater visibility, although that would come with greatly increased costs.
The increased visibility could also be a double-edged sword if the allegations made by BuzzFeed on its programme-making ambitions are even remotely true and the pointlessness of London Live is highlighted once again.
It is unlikely that Jeremy Hunt will read this piece and if he did it would be even more unlikely that he would admit his big idea was misconceived from the beginning. He might even claim it as a success because after all there are about 30 licenced stations out there and local people up and down the country have the choice of a local TV service to watch.
If he is prepared to recognise reality and pay out on his bet, then dinner at Rules in Covent Garden’s Maiden Lane would do very nicely.