Who's in line for London's local TV franchise?

http://www.guardian.co.uk/media/2012/oct/28/who-london-local-tv-franchise

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The five bidders vying to run London's new local television service will find out next month from the media regulator, Ofcom, which of them has won what one contender described as the most lucrative UK TV licence to go up for grabs since Channel 5.

"I have heart palpitations every time an email says 'Ofcom' at the top, so God knows what it'll be like when the verdict comes through," says Guy Hornsby, executive director for one bidder, London8. "There is no plan B," says Richard Horwood, chief executive of the rival LondonTV bid. "I have given two years of my life exclusively to this."

Local TV was put firmly on the policy agenda soon after the coalition government came to power by the then culture secretary, Jeremy Hunt. There has been widespread scepticism in the media industry about the proposals, with even the investment banker Nicholas Shott questioning the commercial viability of local TV services outside major conurbations in a report commissioned by Hunt.

Ofcom received 57 bids for 19 of the 21 local TV licences it initially advertised and nine have been so far been awarded (for Belfast, Brighton, Bristol, Cardiff, Grimsby, Norwich, Nottingham, Sheffield and Southampton) Awarding the licences is Ofcom's panel, led by the former BBC and Channel 4 executive Tim Gardam.

All the local TV services in England will be broadcast on channel 8 on Freeview and channel 17 on Sky. The BBC is providing £25m for infrastructure and £5m a year over three years towards content costs for all local TV services.

But if there is one place that local television could work, it will be the nation's capital. One of the London bidders suggested the licence could be worth "tens of millions" three or four years into its 12-year lifespan.

Besides its attractions for advertisers, the capital has the added advantage of being a defined region – meaning that viewing figures can be provided by Barb (bidders in areas outside London have been told by the government to come up with a suitable measurement system of their own).

London8's Hornsby argues the capital can sustain a local TV service, pointing out he is based in Amsterdam, which has two local stations servicing a population of just 600,000 people. His London8 is billing itself as offering the most local bid, with comedy and entertainment. Its team is based in the Riverside Studios in west London, led by the former Channel 4 chairman Luke Johnson with backers including ITN, Time Out and the Press Association.

The London8 bid, which promises to revitalise the historic Riverside Studios, aims to be "a TV version of a tweet" for people to dip in and out of. The team use the word "fun" a lot and cite the long-lost ITV regional structure as an inspiration. Hornsby's business partner, William Burdett-Coutts, admits that it will be "tricky" for any of the bids to turn a profit, but he is confident London8's can. The competing LondonTV bid is backed by the regional newspaper publishers Archant, Tindle and Trinity Mirror and involves the former ITV News executives Clive Jones and David Mannion. Its chief executive, Horwood, a former Trinity Mirror executive, has been trying to launch local TV in London for 20 years and is confident Ofcom will accept his bid's argument – that local TV only works if it is supported by other content, which LondonTV will get from a production company it has signed a deal with (but won't name). The bid also includes a multimillion-pound annual budget for more programming in addition to the minimum commitments, and that could well include quality, non-news commissions.

"Exclusively local programming on a channel, whether it's a cat up a tree or anything else, doesn't work commercially, you have to mix it with high-quality entertainment programming, that drives viewers and is attractive to advertisers, to fund the local programming," says Horwood.

The other bidders are the Evening Standard's London Live – which is planning to use its print resources and free marketing in the capital's daily freesheet. Next are two "multi-city" hopefuls that have also applied for other local TV licences. The first is Made in London – chaired by the former BSkyB executive Ian West with backers including Time Out (again) and Ambassador Theatre Group. It is promising to cater for the city's diverse population, including shows for the elderly and covering gay and lesbian issues.

Completing the line up YourTV London, headed by the former Tory MP Steven Norris. YourTV London is emphasising citizen journalism, promising video diaries, amateur sports reports and uploaded, on-the-spot coverage of events.

Sources suggest most of the bids are running at budgets of around £10m a year. Burdett-Coutts wants advertisers to be able to get on air for about £5,000, with a guarantee of around 28 ad spots, and hopes that 25% will be small local businesses. He adds that he expects to sell £6m worth of ads in the first year – taking a hit initially but turning a profit after three years. "The margins are tight. It has to look good," he says. "Nobody will stomach badly made programmes and no decent programmes means no advertising."

Thomas Joseph, an analyst at Enders Analysis, says that "London is easily the largest prize" among the local TV licences up for grabs. "It will be easier to sell advertising in London – but they will have problems in the regions. It is going to be very difficult to create commercially viable local TV stations outside the very large cities.

"It remains to be seen which way Ofcom will go, but in London all the bidders claim to be commercially viable and they have probably the best chance of realising that." Local television, he says, offers bidders "the advantage of getting into video content with potentially very cheap distribution on digital terrestrial TV – no wonder they are attracted to it".

And neither he nor the London bidders appeared worried that Hunt, the great champion of local TV, is now in a different job, replaced as culture secretary by Maria Miller. "It is a great idea which he has set in motion, nothing can change it," says Burdett-Coutts. "The concept is great but the tricky thing is for it to add up."

The five bidders

London8

Adamant that it's the most local bid. London8 will operate from the west London studios where classic shows such as Hancock's Half Hour were made, and the bid assumes costs will be low. It is also promising entertainment, comedy and theatre every night of the week. With ITV's former entertainment supremo Paul Jackson and the entrepreneur and former Channel 4 chairman Luke Johnson on board, it claims it has the programme-making expertise required.

LondonTV (the Channel 6 Consortium)

It has a very "hard news" approach to London, with David Mannion (editor-in-chief of ITV News for 10 years) as head of news, supported by the hundreds of local journalists working for the three backers: Archant, Tindle and Trinity Mirror. While it offers less overall local content – a still-ambitious 2,000 hours a year rather than the 6,000 promised by its main competitors – much less of it will be repeats.News output will be surrounded by high-quality entertainment programming, sourced from a so-far unnamed partner, to drive up viewing and advertising revenues, as it argues this is the only way local channels are commercially successful around the world.

London Live (London Evening Standard)

The bid is led by an eight-person management board, including the paper's chairman, Evgeny Lebedev, its editor, Sarah Sands, and the Standard's managing director, Andrew Mullins. Other backers of the bid include Peter Bennett-Jones (ex-Tiger Aspect) and the former Ofcom boss Stephen Carter. A lot of the news will be covered from the newsroom of London's evening newspaper and the cost of the bid is in effect being underwritten by the Lebedevs. An 18-hour daily schedule is planned initially, with news making up 28 of the 49 hours of new content each week (much of it quite laden with travel news for commuters). Other bells and whistles in the bid include the promise of £5m of free marketing in the Standard, plus daily listings in the paper.

Made in London

Led by James Conway, a former TV executive in Ireland, who is a 45% shareholder in the venture, its submission ticks a lot of boxes – enthusing about the "rainbow" nature of London, for example – and proposes a different approach to crime, a local TV staple. "Rather than reporting every stabbing for the sake of it, we will talk to London gangs, discuss their grievances, seek solutions and talk to knife-crime victims," it says. One programme, called Grey Matter, will cater for the elderly and another will cover gay and lesbian issues. Behind the bid is a team of advisers including the former Emap boss Tom Moloney and the investigative journalist Donal MacIntyre, who will be given his own current affairs show. One of two "multi-city" bids.

YourTV London

Led by the former Tory MP and London mayoral candidate Steve Norris, the second multi-city bidder offers a clear news-led proposition with a stress on citizen journalism – and also includes a books programme at the heart of its schedule. Promising video diaries, amateur sports reports and uploaded on-the-spot coverage of events, it makes a point of saying "our audience will be a significant part of the programme-making process"; and calls viewers "our ambassadors as well as our stars". It also claims it will truly reflect multicultural London.