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February 7, 2020updated 30 Sep 2022 8:54am

Former PCC chairman calls for urgent competition reform so news industry can take on tech giants

By PA Medialawyer and Press Gazette

Urgent reform of media ownership rules is needed to allow the industry to consolidate and take on the threat posed by Google and Facebook, a former press watchdog chairman has warned.

Legislation needs to be swiftly updated to ensure the future of a commercially viable free press, Tory peer Lord Wakeham (pictured) argued.

The ex-Conservative cabinet minister, who previously headed the defunct Press Complaints Commission (now the Independent Press Standards Organisation), made his comments yesterday as the House of Lords debated the Government’s response to the Cairncross Review.

The review, chaired by Dame Frances Cairncross, examined the sustainability of quality journalism in the face of declining newspaper sales and falling revenues and offered up nine recommendations to save the news industry, some of which have been taken forward.

Commissioned by then-prime minister Theresa May, Cairncross argued that online platforms like Google and Facebook should have a “news quality obligation”,  overseen by a regulator, to improve trust in online content.

The review also called for ministers to look at new tax breaks for “public interest” journalism, with direct funding for local public interest news.

Lord Wakeham said: “Times have changed but one thing remains constant: the crucial importance of a free press in a democracy. I’ve learnt over many years that you cannot have a free press unless you have one that is commercially viable.

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“Newspapers have to be able to make profits to survive. And that is what is in jeopardy now. The press is under greater commercial pressure than at any time in its history.”

The revenues of traditional newspaper groups have been slashed as online platforms have “taken a bigger and bigger share of the advertising market”, he told peers.

Lord Wakeham said: “That cannot go on. We must ensure support of the industry as it consolidates, which it surely must.

“There must be further rationalisation if publishers are to have the strength to take on the competition.”

While two decades ago competition was between newspapers, today it is with multi-billion dollar tech giants “which are vacuuming up the advertising market at an ever increasing rate”, he said.

The Competition and Markets Authority and Ofcom are currently investigating the Daily Mail publisher’s purchase of the i newspaper on the orders of Culture Secretary Nicky Morgan.

Lord Wakeham added: “Publishers need the strength to be able to take them on and not each other, and that strength comes from the combined weight of consolidated, strong and successful companies.

“That needs a thorough review and reform of the media competition and ownership regime that allows newspaper publishers to reduce costs, increase revenues and invest in the journalism that will allow them to take on the global competition without any impact on media plurality.

“One of the great dangers is where legislation lags behind the reality of the market. Our legislation in this area is ages old and I hope the Secretary of State will look at swift action in this area.

“It would help as much in saving a free press. If we don’t it may be too late.”

Pressing for Government action to support the industry, Conservative peer Lord Black of Brentwood, deputy chairman of the Telegraph Media Group, said: “The grim truth is that help is needed now if many local newspapers are to survive while they bridge the gap between print legacy and digital future.”

Culture Secretary Lady Morgan said the Cairncross Review had “vividly outlined” the threat to high quality journalism in the UK, with the print circulation of daily national newspapers and local newspapers falling.

She said the “main driver” was a rapid change in how people consumed content with a rise in reading news online threatening to undermine the financial sustainability of journalism.

She hailed public interest journalism as an “essential component” of democracy and holding the powerful to account.

The Government did not support the Cairncross Review’s proposal to establish an institute for public interest news, saying it wasn’t for the Government to take it forward.

Morgan said: “There may well be a very good argument for an institute,” but told peers it may be for another body to establish it.

Lady Morgan said ministers had committed to review how online advertising is regulated, adding: “We are committed to getting this work right so that future generations can be inspired and engaged by a free and vibrant press.”

Picture: Parliament TV

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