A new local television station for Birmingham could be broadcasting within two years, Culture Secretary Jeremy Hunt has announced.
The city was picked to be one of the pioneers of a new type of highly local television service backed by the Government. Ministers have already received initial bids to run the station from five potential operators.
And Mr Hunt revealed the new station would receive a payment of £150,000 from the BBC, in return for access to local news footage, to help it get up and running in its first year. The new television channel will cover a much smaller area than existing ITV regional services.
Birmingham’s station will broadcast to Birmingham, Walsall, Dudley and parts of Wolverhampton. And a number of much smaller local stations could start operating a year later.
Birmingham is one of 20 “pioneer areas” chosen to receive a licence in the first round of the Government’s plans. Others include Leeds, Liverpool, London, Manchester and Newcastle. In round two, licenses are set to be awarded to 24 areas, including Malvern, Hereford, Kidderminster, Stoke on Trent and Stratford-upon-Avon.
The television plan is designed to help the struggling local media industry, and in some cases existing newspaper groups could also run local television stations.
Some critics, such as former national newspaper editor Roy Greenslade, Professor of Journalism at City University London, have questioned whether “hyperlocal” television stations can be commercially viable.
But Ministers point to a study commissioned by the Department for Culture, Media and Sport which concluded that stations might need budgets of just £500,000 a year to operate, which would be raised from advertising. Mr Hunt also said he believed that it may be possible to run a station for much less.
Broadcasters will be obliged under the terms of their licence to provide one hour of news coverage a day, and will be free to decide what to broadcast the rest of the time, or whether to broadcast at all.
Rival bidders will submit applications for licenses to Ofcom, the broadcasting watchdog.
Only one licence will be issued for each area, and franchises are likely to run for up to 12 years. The bidding process will be a “beauty contest” rather than an auction, with submissions judged on the quality of the service they are promising to provide local people.
Announcing the areas to be included in the first wave of stations, Mr Hunt said: “This is actually a really important day for local TV.
“I think that this is a quiet revolution in our broadcasting landscape.
“In five years time people will look back and say, what was the most important thing that happened in the media world in this period?
“And actually, although for Westminster people will talk about phone hacking and all those issues, actually for the general public they will say the biggest change will be the licensing of a new generation of local TV stations.
“I think it will be a huge change and incredibly popular.”
The BBC will provide a total of £40 million from the licence fee to support local television stations. This includes £25 million to pay for infrastructure, such as modifying television masts, and £15 million for the broadcasters themselves, as syndication fees for local news footage.
In the first year, the BBC will simply pay £150,000 to each new station. In the following year, this guaranteed sum will be reduced to £60,000. Eventually the BBC would be expected to support local news channels by buying footage on a commercial basis, Mr Hunt said.
Under the Government’s plans, the first local television licences will be awarded from mid 2012.