Media bigwigs: EU pubcaster rules out of date

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BRUSSELS -- A coalition of European media barons is calling for an overhaul of EU public service broadcasting rules, saying the standing structure was "good while it lasted," but is "no longer serving the public interest."

Publicly funded broadcasters have distorted the TV market and commercial media companies now face the unregulated colonizing of the Internet and mobile market from PSBs, the European Publishers Council said.

The EPC said the European Commission's review of rules for state funding of public service broadcasting, announced in January, will have to result in radical changes to protect the viability of commercial media.

EPC members include News Corp. chairman James Murdoch, Lagardere Active chairman Didier Quillot as well as the heads of the U.K.'s Reed Elsevier, Sweden's Bonnier Group, Germany's Axel Springer and Gruner + Jahr and Finland's SanomaWSOY.

"Long-established public service broadcasters in Europe have expanded hugely with public funds -- and in some cases with the unfair advantages and distorting effects of advertising revenues, too," EPC chairman Francisco Pinto Balsemao said. "But today's PSBs are producing products little different from their commercial competitors and with only a handful of services which could truly be described as public service broadcasting."

Balsemao said that the EC has to address the question of how to define a public service and establish criteria for assessing what is of value to the consumer. It would also have to work out appropriate levels of funding to achieve this objective without distorting or damaging the private sector and without stifling the growth of the media sector, he said.

A key issue in the commission review will be the public service remit in the new media environment. Many public broadcasters also subsidize Web sites that compete in a commercial setting, and rivals say the aid gives them an unfair advantage.

However, the commission already has indicated that, while its own task is to preserve fair competition in the European market, it recognizes the wide discretion of governments to define public service broadcasting. This implies a clearly defined public service mission while limiting state aid to what is needed to fulfill this mission, excluding overcompensation and possible cross-subsidies into commercial activities.
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