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Ofcom chairman David Currie has given a strong indication the regulator is ready to relax ITV's public service commitments.
The commercial broadcaster says it needs an urgent reduction in the amount of regional news and children's programmes it is required to broadcast.
Ofcom is currently midway through a review of public service broadcasting and will set out proposals on how a new system should be structured and funded later this year.
"ITV may overstate the costs and understate the benefits (of being a PSB)," Currie acknowledged today. "What is beyond doubt is that the value of PSB benefits drops rapidly and the point at which the costs of the public service obligations in a Channel 3 licence exceed the benefits will occur well before 2014; earlier in some C3 franchises notably Scotland.
"In these circumstances ITV plc’s relationship with the Nations poses particular challenges. Political wishful thinking will not change those facts," Currie told an audience at the London Business School.
"People confuse Ofcom the messenger with the message. They assert we are ‘letting ITV off’ or have been hoodwinked. Far from it. We would be delighted if the numbers looked different. But they don’t. The current down-turn will accentuate the pressures."
"So we need a clear-sighted view of what the public policy priorities are in relation to ITV. Whatever the future compact it will need to be much more limited, explicit and transparent than hitherto. And flexible. Tying regulatory benefits - spectrum assets - for years on end to an institution with fuzzy and meaningfully unenforceable public obligations seems a poor model for the rapid transition we expect in the media landscape over the next decade."
