A regional publisher whose local TV station reportedly posted a loss of more than £650,000 last year has questioned the future of the initiative.
Jeff Henry, left, chief executive of Archant, has predicted mass closures of local TV stations next year, unless more support is given to the sector.
His comments come after Norwich-based Mustard TV, which is run by Archant and was launched in March last year, reportedly posted a loss of £657,000 in 2014.
In a national newspaper interview, Jeff said he thought the route to profitability was “very challenged” and said it was “questionable” whether he could make the channel profitable.
Speaking to The Guardian, Jeff said that in order for local TV to be commercially viable, it needs more financial support from the BBC and for media regulator Ofcom to allow the relaxation of programming regulations.
“I think the route to profitability at the moment is very challenged. Fundamentally something has to change … the model of local TV has to be re-examined in a way that allows fledgling operations the chance to actually grow. Can I get it to profitability? At the moment that is questionable.” he told the paper.
He insisted that Mustard TV’s losses had been cut significantly because last year’s figure included one-off setup costs and building up the audience.
Both The Guardian and the BBC have reported the £657,000 loss figure for 2014 although the company has yet to confirm this.
In his interview, Jeff said that he thought the BBC’s three-year agreement to buy content from local TV stations needs to be extended beyond March 2017, so that the businesses can become established.
In a further statement issued to HTFP, he said: “The cost of running the licence for a local television channel such as Mustard TV is a significant investment and we are working towards the establishment of both sustainable cost base and commercial revenues.
“The current local television model requires fundamental review – we need the licence fee to continue for longer, or the freedom to expand the channel.
“The results demonstrate the underlying economic difficulty of providing a quality service in a limited broadcast area. Addressing the local TV model is the next important step in enabling media businesses like Archant to thrive and grow.”