The local television broadcasting system in Italy: too few resources for too many companies?

Flavia Barca
FREELANCE RESEARCHER, ROME

In this article I would like to open a debate on issues emerging from research undertaken (in collaboration with Patrizia Novella) on the Italian local broadcasting system. The research was commissioned in 1995 by Verica Qualitativa Programmi Trasmessi (the Italian Public Broadcasting Research department) and the Mediaset the main Italian private communication company Research department.1 The study opened a window on a eld which was completely unexplored, to the extent that the exact number of companies broadcasting at the time was unknown. Its rst objective was, then, to dene the area of study by quantifying the number of operating companies and differentiating between agents with their own identity (i.e. those that produce a minimum share of their own scheduling), and those that limited themselves to reproducing programmes broadcast by other stations. The results of this analysis will be the object of the rst part of this article. Its aim is to underline the ambiguity of what is meant by the local broadcasting sector. Quantifying the existing situation is not the only signicant reason for dening the sector. As will be clear in the second part of the article, understanding the main features of local broadcasting stations is vital in order to be able to answer a question of utmost importance: notwithstanding the scant resources available, why is this eld so crowded and lively? The argument advanced here is that owning a local television station is important not so much for the immediate economic advantage it yields, as for the role the station plays in the owners entire economic activity.
Media, Culture & Society 1999 (SAGE Publications, London, Thousand Oaks and New Delhi), Vol. 21: 109122 [0163-4437(199901)21:1;109122;006795]

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Local broadcasting took off in Italy in the 1970s, after the 1976 Constitutional Court decree which liberalized television broadcasting at a local level.2 By 1982 the number of local stations amounted to 1594.3 In 1988 a Ministry of the Post survey showed 959 stations at work (Gambaro and Silva, 1992) and, two years later after the 223 law4 1376 franchising requests were submitted to broadcast TV programmes locally. These numbers show the effect the liberalization of broadcasting had in Italy, but they only reect broad estimates of a phenomenon which has always been difcult for both scholars and research institutes to survey. One of the difculties is to be found in the typically Italian ambiguity of legislation concerning this matter. Indeed, laws on broadcasting have always been taken as temporary measures and have never been fully recognized (Ortoleva, 1994). The decree of the Constitutional Court on this matter was quite imprecise and failed to provide clear indications as to what is to be understood by a local TV station (Vacca, 1984: 7). It was only 14 years later that the government succeeded in passing a law number 223 on private broadcasting. During this period all commercial TV stations operated on a provisional basis with no rules to follow. Unfortunately, the law passed in 1990 did not bring any notable changes, partly due to its omissions, partly because it pointed to an allotting of frequencies which has still not taken place,5 partly because of the extreme weakness of the controlling bodies responsible for its effective implementation. As a result, the local broadcasting market is still in total chaos. Indeed, in January 1995, at the outset of our research project, we found a good number of local TV stations not complying with the current legislation.6 The lack of a denitive strong law together with an efcient strong regulating body has resulted in a situation where at present, as in the past, the number of broadcasting stations holding a temporary franchising concession7 corresponds neither to the number of those holding a registered trademark, nor to those actually operating locally, nor to those fully complying with all the legal obligations.8 This implies that the numbers mentioned above are all extremely imprecise and quite unreliable, as shown by our 1995 survey. According to the available catalogues and yearbooks, there were, at the time of the inquiry, 1059 television broadcasting station trademarks in Italy. Some of those quoted did not correspond to operating companies and were simply the result of duplication (by mistake) on the part of the yearbooks editors. Furthermore, a relevant number of the surveyed broadcasting stations proved to be inactive; and there were at least 50

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among them which were set up ad hoc in order to apply for a franchise but have never started working. Among the 1059 TV stations listed there are 714 which have been given temporary franchises in 1995. According to our estimates (based on approximate and low gures, as they only concern the part of the sector under analysis9) at least 9 percent were not operating at the time. Franchised television stations broadcasting at the time, then, did not amount to more than 650; 600, if units belonging to the same group are counted as one (data on trusts are probably underrated as they only refer to the television broadcasting stations interviewed). Out of the 650 broadcasting stations operating, an estimated 10 percent had a higher turnover than two billion lira. They made up a set of 65 units labelled in the survey as medium-large10 with an average of 33 operators employed. These are likely to be the future subjects of an evolving local television market, as companies able to invest in innovation and especially in new technologies. Out of a total of 650 stations with franchising, only a limited number broadcast self-produced programmes. We singled out, through a telephone survey, about 200 television stations broadcasting autonomously at least two hours a day. Of these, 140 broadcast more than four hours of self-produced programmes. This could be deemed an underrated evaluation, as some stations actually engaging in self-production may have been missed out by our survey (particularly some community TV channels for which data are very limited). On the whole self-production appears to cover 24 percent of the broadcasting of local stations, but this gure, in our opinion, is overrated by the interviewed operators. The gures quoted on the present size of the local TV market conrm what we said earlier about the ambiguity of the notion of local broadcasting station and consequently the difculty of evaluating such a phenomenon with some degree of precision. Nevertheless, the gures relating to the number of companies operating since the 1970s show that, in spite of some discontinuity, the local TV market has stayed more or less the same through the years.11 The second part of this article will be an analysis of this phenomenon. Though many convincing hypotheses have been advanced on the sudden outburst in the 1970s of so many local television stations, the reason why today, in the mid-1990s, the number of local TV stations in Italy is still so incredibly high is much less clear.

Resources Explaining the reasons for the sudden outburst of local broadcasting in Italy is an easy task, as this has already been the object of several studies which have pointed out a multiplicity of often interdependent factors.

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In the rst place, by the mid-1970s, the time was ripe to stimulate a new demand from the audience: the political climate had changed and the RAI was losing its legitimacy (see Ortoleva, 1994) while radio and TV monopolies were gradually disintegrating throughout Europe (see, for example, Barberio and Macchitella, 1989; Gambaro and Silva, 1992; Menduni, 1996; Richeri, 1993); large sections of the population were asking for greater access to media and for different kinds of information; political forces were seeking new areas of inuence and pressure; and, last but not least, consumption levels were rising while the relationship between leisure and working time was being reorganized (Monteleone, 1992). In the second place, the lowering cost of technology and particularly that of the electronic apparatus for lming and broadcasting had taken away a basic obstacle towards access to the radio and TV market and stimulated the growth of new enterprises. Besides, steps were taken towards an everincreasing integration between such formerly separated sectors as lm, records and television (Pilati, 1992), thus stimulating vertical integration between different enterprises. Third, the private sector in Italy had developed following the pattern of anomaly pointed out by Ortoleva (1994): a failed deregulation following a failed regulation. In the period between the Constitutional Court decree and 1990 there was practically no legislative obstacle to access, and consequently a process of colonization of virgin lands took place, which was typical of the whole history of private radio and television in Italy.12 Lastly, a central role was played by industrys growing interest in investment in new media. On the one hand, the mass consumption market showed an ever increasing interest in new spaces able to promote brands (Pilati, 1992). On the other hand, the entry of the Fininvest group into the communication sector started off a radical revolution in the Italian advertising market, the full potential of which was understood for the rst time: indeed, Berlusconis planned strategy of stimulation of demand became the Trojan horse in his conquest of the broadcasting system (Pilati, 1992; see also Barca, 1994; Pilati, 1994). If the analysis of these multiple causes is sufcient to explain the rise of the phenomenon called local broadcasting system, it is far more difcult to justify the survival of the sector throughout the 1980s. An analysis of the trends of nancial investment in advertising during this time shows that the survival of so many broadcasting stations was clearly not due to these resources. In 1980 advertising resources for the private television sector was 171 billion lira according to data included in a research study carried out by Pilati (1992). In 1985 the Fininvest network signicantly outdistanced local broadcasting stations collecting 1240 billion lira against 110 collected by the latter. In 1989 the national commercial television collected 2260 billion lira and the local stations only 182 billion. In 1993 the

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Television Authority13 estimated that the total advertising resources of 250 television companies was 269 billion lira. This amount was almost equal to the total collected by the whole sector, considering that the companies the Authority reviewed included all the companies of considerable size operating in the local broadcasting system.14 Again, in 1993 Upa estimated that local stations collected 238 billion lira from advertising (Terracciano, 1995). An Frt (Federazione Radio Televisioni Radio and Television Association one of the most important professional associations in the eld of local broadcasting in Italy) study, reviewing the 1994 balance, reports that 337 broadcasting stations showed a total of 362 billion lira coming from advertising. From this data Frt speculated that the entire local television sector could count on 470 billion lira. The gures taken into consideration are all approximate and certainly not consistent. The reason is to be found in the difculty of monitoring a uctuating sector lacking, as we have already mentioned, a clear denition and transparency.15 At any rate, the data collected clearly show the scant nancial resources coming from advertising. Different surveys (Associazione per lEconomia della cultura, 1995; Frt/ lem, 1994; Garante per la Radiodiffusione e lEditoria, 1992, 1993, 1994, 1995) demonstrate that the ofcial nancial resources in the local television broadcasting sector are sufcient to support only a very limited number of companies, no more than 100 to 150. Indeed, the majority of these companies are running in a non-economic fashion. This term has been used by the Authority for companies with a turnover lower than one billion lira over 158 among the companies reviewed in our study. Many companies reported a decit in their business.16 The situation of structural loss in a large proportion of the broadcasting sector in Italy raises the question of its very reason for existence. This reason is understandable for broadcasting stations that are truly non-prot associations, relying on volunteer work in that their mission is clearly social and non-monetary. But for the majority of local broadcasting stations that run the business for prot the reason must be different. On the basis of the 1995 study, it is possible to propose two hypotheses (Spada, 1995: 566): hidden nancial resources and the strategic function of the broadcasting station within the owners whole sphere of commercial activity. What I mean by hidden nancial resources is the presence of trading activities that research institutes nd difcult to measure. These include agreements between the broadcasting station and sponsoring companies, between the station and fortune tellers, astrologers, salesmen, companies producing advertising on fashion or leisure activities in short, a whole complex of small and large resources which are the main means of survival for these companies. In some cases these agreements are openly dealt with, in others they are far less obvious and this makes it impossible to correctly quantify the true strength of this market and the true interests at play.

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Furthermore, for many operating TV stations in Italy, advertising material above all television sales is the only type of programme available. Prot is the only objective for these stations as they are not interested in creating an identity for themselves through self-produced programmes. Smaller companies probably take advantage of these market opportunities as Gambaro and Silva point out. According to these two researchers, the presence of local broadcasting stations can be explained by the theory of the Penrose interstice economy, whereby small companies can survive only because larger companies expand too rapidly to be able to absorb the demand. As a result the latter, by refusing the least nancially advantageous opportunities, leave them to the former (Gambaro and Silva, 1992: 288). However, prots are always very small, at the most they are sufcient to cover expenses, and very rarely enough to accumulate capital or allow new investment. It is important to point this out before introducing the second hypothesis. Indeed, if the rst hypothesis provides a reason why so many local broadcasting stations can survive, it does not explain why local broadcasting is a sector in which important business people, whose turnover is far greater than that of the television company they buy, invest. In effect, our study shows that the majority of local television company owners run other commercial activities usually unrelated to this sector. In particular, the following kinds of activities were identied: trading, nancial and media services; industry; other broadcasting stations and other media such as newspapers, radio stations, cinemas. Finally, in some cases, the owners are politically active. The analysis of the sectors where television owners invest showed two main types of concentration. They are either multimedia concentrations, that is, television broadcasting and other media (radio, press, cinema) together with other companies operating in the eld (advertising agencies, production companies), or conglomerate concentrations, that is, television broadcasting together with non-media sectors: in other words, a merger between a television company and a company outside the communication sector (such as banks, political bodies or different commercial service agencies). Four main strategies explaining the advantages deriving from this kind of concentration and therefore the benets of keeping a local broadcasting station open, may be outlined17 as follows: 1. Promotion of ones own services through television. Since television is the promotional medium par excellence, any company would benet from association with a television station. If, for example, the owner of a TV station also owns a distribution company, he may set off an interesting triangular synergy (as stated by the Bologna Rete7 broad-

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casting station) between the company, the broadcasting station and suppliers: the station advertises its own salepoints network (83 percent of those who watch Rete7 do their shopping at Coop supermarkets, owner of the broadcasting company) and attracts new suppliers, while the latter have the opportunity to advertise their own products on television (using a strategy of sales aimed at specic market sectors). In this way the broadcasting station secures itself advertising sales and increases its ownerships strength in the market. Another example is Videolina in Cagliari: through a concentration of television, telematics, radio and press it was able to create a virtuous circle from direct and indirect advertising which gave it an advantage over other companies. 2. Realization of economies of scope.18 A television station owner who is also the owner of other media, of media services or of commercial services, may be advantaged by the concentration of various activities in different ways: the manager of a disco, for example, can also use it as a studio to record programmes for the broadcasting station. Furthermore it is often the case that staff from different companies can be employed more efciently if different services are put together. Telenova, for example, declares that the benets deriving from the synergy with the magazine Famiglia Cristiana are mainly the gathering of information (the whole group is net connected), exchange of journalists and technicians and reciprocal advertising. In this case the advantages are also due to the adaptability of the same product to different media. The latter procedure probably constitutes the drive for merging between television and radio companies. For example, three local broadcasting stations (Videospezia in Liguria, Telereggio from Reggio Emilia and Video 3 from Catania), differing considerably in size but all three merged with a radio station, during different hours of the day broadcast programmes they share with radio: the sound is the same for both media while a camera lms the disc-jockey as he/she plays the music and talks with the audience (an extreme example of this is Videospezia where radio and television share all of the programmes scheduled). 3. Increase of selling power in the market. For the owner of other media and/or media services both vertical integration (between different moments of the production and distribution of the television product) and horizontal integration (between different companies within the communication sector) guarantee greater control and contractual strength (on the advantages of different forms of integration, see Gambaro and Silva, 1992; Menduni, 1994; Richeri, 1993). For example, it often happens that the owner of a local television station also owns a radio station, or a newspaper, or more than one TV station. Being able to offer a wider audience potential, and to plan

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advertising breaks on two different media strengthens the contractual power of the broadcasting station in the face of the advertising demand. 4. Increase of power on the political market. Ownership of a local broadcasting station can also ensure an increase of power on the political market. This may be true both for politicians and other subjects. As television is such an important means of opinion making, it can be used to favour ones own political career (where, for example, ownership is directly tied to a political party) or in order to favour somebody (an entrepreneur, a political party, the local administration) who will later on return the favour. Situations in which broadcasting stations are launched (or bought) in order to oppose the power of a local administration which is considered troublesome by another centre of political or economic power must also be mentioned: those classes feeling menaced can try to defend their own contracts as well as their political interests through television. It is often hard to distinguish the different reasons that lead to investment in the local broadcasting sector. Indeed, television can be the means to promote services and an opinion making instrument at the same time. In the case of Turins Istituto San Paolo, the ownership of a television station covering Milan and its province (Telenova) represents a way of promoting its commercial services (banks and so on), but also, and most importantly, an opinion making instrument which at the same time strengthens the groups image and identity and its relationship with the administration and the local bodies. Or, as the Roman entrepreneur Raffaele Garofalo, owner of nursing homes and of the broadcasting station Telesalute, said, television will also be a means of letting the audience know my opinions regarding the private managing of the health sector (Repubblica, Affari e Finanza, 2 October 1995: 8). In all these examples the benets for the local broadcasting company are not easy to survey. The principal aim is not that of drawing prot from the production but rather that of creating scale or scope economies with the other activities of the group, or that of building a barrier to entry by other investors, or again of satisfying non-economic interests tied both to the occupation of the market and to the building up of an important source of information and communication. A local broadcasting stations value can therefore not be quantied under such headings as advertising resources or other resources (even though both are extremely sensitive to the industrial strategies mentioned earlier) because a television company can have a minimum turnover and yet be a strategic element in the whole of an entrepreneurs activities. The reason why in so many situations the ownership can afford to keep a losing broadcasting company is thus clear. Lets examine the most common example a local broadcasting company in the hands of a local business man. How much would the

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budget of a TV station with a turnover of around two billion lira inuence the total turnover of the owners commercial company, which is likely to be between 50 and 100 billion a year? (This was the case with one of the broadcasting stations under analysis.) The return on a TV investment is obviously not economical, at least not directly, even if the station were a protable concern. However, by means of a broadcasting station, a local businessman not only advertises his own company, but creates or strengthens political alliances which may prove to be of extreme importance for the future of his business.

Conclusions Due to the lack of a strong broadcasting law, as well as of a controlling body able to enforce existing legislation, the local broadcasting system in Italy has developed in a different way from that of other western countries: it has no precise mandate in terms of the specicity of its products and therefore in terms of its economical and social goals. Such choices or rather such lack of choices spring from the confusion of two otherwise sharply distinct concepts: liberalized market and non-regulated market. Due to the fact that the local broadcasting system has never been considered a protable sector, the related legislation has never aimed at improving its economical efciency and competitiveness. The local TV stations, ready to be considered the poor relatives of the national commercial networks, were soon to cover marginal areas or niche markets of hardly any economic interest (or rather hard to exploit economically on the part of broadcasting companies less tied to a specic region). Out of such strong roots in the local community originates that interlocking between local business, TV concerns, public bodies and local politicians which has given vent to a new federalist regulation, based entirely on local and private interests. While the identity of the regional broadcasting product has never been discussed in Parliament, the whole matter of TV output has been almost completely left to market laws. Consequently, as appears from the present survey, there is a strong link between the modes of regional production and the business strategies of any TV stations owner. In short, the two raisons d tre of local stations we have described e correspond to two different types of television.19 On one hand, there are stations whose scheduling only comprises shows of a commercial kind, as the company relies on a very high number of advertisers. Therefore, production is minimal or strictly conned to increase sponsorship and there are almost no news programmes. These are generally protable companies. The other side of local broadcasting is represented by companies aiming at self-production and at news programmes as a way of being recognized;

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their goal is to build up a trademark with a strong image and a certain amount of authority so that the station becomes an important opinion maker as much as an advertising channel. Such TV stations are not protable for the most part, especially because of the quality level they are obliged to keep in their programmes; their losses, however, are often counterbalanced by different kinds of returns, economic and otherwise, originating from activities strictly integrated with the station itself. In many cases then, the products quality is indeed guaranteed by the protable nature of the local broadcasting station and is part of its entrepreneurial strategy. But it is not enough to guarantee either an efcient economic exploitation of the whole local broadcasting market, or the fullment of the audiences needs. At this point a series of both ethical and economic questions are paramount, relating, on the one hand, to the social function of local TV production on the threshold of the third millennium, and on the other, to the efciency and competitiveness of the sector.20 These questions urgently need attention.

Notes
1. The research results have been published (Barca and Novella, 1997). 2. Decree of the Constitutional Court no. 202, 28 July 1976. The pressure to receive government permission to broadcast at a local level goes back to 1956. Months before the decree 32 television stations were ofcially registered in the roll of the Ministry of Post (Ortoleva, 1994). For chronological information on the different legislative clauses and the progressive development of the local broadcasting system in Italy, see Bartolomei and Bernabei (1983). 3. According to Rai estimates, out of the total number of stations, 935 broadcast their own programmes and 459 foreign programmes (Vacca, 1984). 4. Law no. 223, 6 August 1990 Regulating the public and private television and radio broadcasting system, the so-called Mamm` Law from the name of the Post and Telecommunications Minister who had developed and promoted it. 5. According to the Law 249, 31 July 1997, which set up a new Communication Authority, the allotting of frequencies should have been approved by the Authority before the end of January 1998. At the end of 1998 a new law regarding local broadcasters was still being discussed in Parliament and the allotting of frequencies had not yet been approved. 6. Concerning the production: obligation to reserve at least 20 percent of the minimum broadcasting schedule (64 hours per week and 8 hours per day) to local news and to non-commercial programmes relating to local actuality (Law 223/90, art. 16, para. 18; art. 20, para. 3); repeats and xed images are not to be considered as programmes; from 30 November 1993, obligation to institute a TV news programme under the direct responsibility of the station director; obligation to devote four hours per week between 9 am and 10 pm to broadcast programmes related to information, dissemination and investigation of social issues (Law 422/93, art. 5). In the texts of the various laws, however, it is never mentioned whether these programmes are to be self produced or not. Only art. 16, para. 17 of Law 223

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concerning franchising rights mentions the percentage of self-produced shows and information programmes required in order to obtain such a concession. See Roppo and Zaccaria (1991) for an interesting commentary on the Mamm` Law and Caretti (1994), Golfari (1994) and Sarli (1994) for an exhaustive overview on the legislation of local broadcasting. 7. Although ofcial data are not available on this matter, at the end of 1995 a temporary authorization to broadcast was given to 714 stations. According to Law 249, denitive franchises have to be approved by the Communication Authority before the end of April 1998. 8. Gambaro and Silva (1992: 274) point out that in Italy from six to seven hundred TV broadcasting stations are effectively operating, and this is also the general assessment of many scholars and specialists in this eld. 9. 293 television broadcasting stations were selected on the ground of the space allotted to self-made production. Among the stations listed we chose those which produced a notable part of their scheduling, or, rather, those stations for which selfproduction was a distinctive trait of their identity. Thus we excluded from our frame of reference all promotionally oriented companies (and their number is very high) which dedicate only a minimal part or none at all of their investments to selfproduction, as well as those ghost headings which are currently awaiting a more denite layout of the local broadcasting system or do nothing more than repeat other broadcasting stations programmes. 10. We have called micro-companies those stations which have a lower turnover than 500 million lira and an audience (the number of net contacts, that is, people who watched the TV station for at least one minute, according to the surveys of the research company TV Bank) lower than 100,000, and mediumlarge those whose turnover is higher than two billion lira and whose audience is higher than 500,000; an intermediate range of medium-small companies follows by deduction. 11. A decrease in the number of stations is noticeable in the mid-1980s, while a sudden growth marks the dawning of the Mamm` Law. The reduction in number of the local stations shortly after the estimate quoted by Vacca complies with the birth of three networks Canale 5, Italia Uno and Retequattro (Canale 5 originated in a consortium of 27 local stations and initially, in 1982, only the leading one, Tele Milano belonged entirely to Silvio Berlusconi; Italia Uno, an association of 18 local TV stations, was founded by Rusconi in 1982 and sold to Berlusconi after a few months; also in 1982 Retequattro owned by Mondadori [owner, in fact, of 64 percent as the remaining shares belonged to Perrone and Caracciolo] and composed of 23 TV stations: in 1984 it will be sold to Berlusconi [Bartolomei and Bernabei, 1983; Monteleone, 1992]). This implies that within a few years many stations merge into the new national private broadcasting system (thus gradually losing their identity). As for the very high number of applications for franchising sent to the Ministry of Post in 1990, this is denitely an issue of a leap in the dark by many entrepreneurs who must have thought that a franchising once ratied would have a monetary value even though at the time of their application they had no TV station effectively operating. The ups and downs of the advertising market tied to many factors such as the triggering and also engrossing role played by the Fininvest group in the 1980s, are not to be undervalued: they have undoubtedly inuenced the development and the crises of many local TV stations. 12. Gambaro and Silva (1992: 2745) remark on this subject: The growth of private television in Italy, vis a vis other countries, has happened in a totally `

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atypical way, as the phenomenon has developed without regulation. This means that there was no positive contribution coming from the presence of many different subjects operating in the same eld. Such positive aspects could have taken place at different levels: a) more intense competition followed by the supply of better products, b) breaking up of the existing situation of public monopoly, and of its rigidity, c) development of a supply independent of party-centred logic and of a Rome-centred television management, d) possibility of giving space to new voices and cultural needs. 13. Garante per la Radiodiffusione e lEditoria (1995). The TV Authority, which has been completely renewed by the latest broadcasting law (249), was created by the 1990 Broadcasting Law in order to guarantee a correct application of the law itself. 14. In our study we called companies of considerable size all those with a yearly turnover of two billion lira. As we have already mentioned, we estimated that in Italy there are no more than 65 such companies. The 1995 Authoritys report (see footnote 13) reviews 49 companies with a turnover of two billion lira. 15. At present many broadcasting stations still dont respect the legal obligation to make their balance-sheets public. 16. And following the 1996 Frt survey only 80 companies out of the 322 studied showed a prot in 1994. 17. Two other strategies are also to be taken into consideration; although not peculiar to this sector they are nevertheless of extreme importance: rst, nancial investment. Some operators in the sector calculated that acquiring a franchise meant a local broadcasting company would gain ve times its former value. Therefore, many TV stations were bought in view of a future denitive distribution of the frequencies. It can also be convenient to buy a company encumbered with debts in order to sell it later on at a much higher price, once the trademark and the advertising clients have settled. At times the resettling also implies renewing an image for those TV stations which have overexposed themselves in terms of their political connotation. Second, gaining shares of the market which could be taken over by competitors with devastating consequences for ones own activity in a certain area. This means that at times the only reason to buy a local broadcasting station may be to prevent a competitor availing itself of this means of communication. The competitor could otherwise breach consolidated distribution monopolies of certain products or increase the strength of its company image at the expense of others. The possibility that in some cases a company may be interested in buying a broadcasting station to dodge taxes cannot be excluded. A businessman who owns company X and TV station Y could indeed justify huge expenses paid by company X as costs for advertising on TV station Y. This could also explain the breaking up of a broadcasting station into different companies (one for programme production, one for technical services, one for the management). This phenomenon is increasing rapidly in the local broadcasting sector: the buying and the selling of products and services between companies may serve to recover the VAT and muddle papers for tax inspection. However, contrary to the other reasons given, this is only a hypothesis as it has no objective basis; indeed, neither the interviewed representatives of broadcasting stations nor other sources ever conrmed it. 18. Economy of scope is realized when, given the production of two services, the production cost for the accomplishment of both is lower if they are taken over by a single body.

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19. Even though at times the two types coexist in the same station: there are those which present a news programme of excellent quality within scheduling of a totally commercial nature. 20. The two issues are often tied to one another. The local broadcasting system has never been attributed with the function of service in Italy, and this appears to be rather anomalous when one considers the enormous strategic potential of this sector in the communication market. On the contrary, this is the only function which can keep local TV within the remote control range when confronted with the ever-growing television provision on offer. It isnt by chance, indeed, that so many stations are now concentrating on news programmes. The alternative they are facing is the loss of their original identity to the extent that they are being absorbed by regional or national networks with niche scheduling. Paradoxically enough, while scheduling with a strong regional identity can coexist with satellite or modem transmitted products, bound to grow ever more numerous, the new niche seminetworks (the survey denes these as groups of television stations which broadcast a few hours of niche programmes at the same time) will have to compete directly with these and the battle will be between national and international programmes. On this matter one of the most interesting niche elds to keep an eye on is that of music.

References
Associazione per lEconomia della cultura (1995) Rapporto sullEconomia della Cultura in Italia 19801990, Presidenza del Consiglio dei Ministri. Roma: Dipartimento per lInformazione e lEditoria. Barberio, R. and C. Macchitella (1989) LEuropa delle televisioni. Bologna: Il Mulino. Barca, F. (1994) The Italian Mass Media Market: A Spoils System with no Rules, MA dissertation, City University, London. Barca, F. and P. Novella (1997) Tv locali in Italia: organizzazione e programmi. Roma: Rai-Eri. Bartolomei, A. and P. Bernabei (1983) Lemittenza privata in Italia dal 1956 ad oggi. Torino: Eri. Caretti, P. (1994) Diritto pubblico dellinformazione. Bologna: Il Mulino. Frt/lem (1994) Le dimensioni dimpresa delle tv locali. Unanalisi dei principali dati dellesercizio 1992 di 100 emittenti locali italiane. Roma: Frt/lem. Gambaro, M. and F. Silva (1992) Economia della televisione. Bologna: Il Mulino. Garante per la Radiodiffusione e lEditoria (1992) Relazione annuale al Parlamento per la Radiodiffusione. Roma: Presidenza del Consiglio dei Ministri, Dipartimento per lInformazione e lEditoria. Garante per la Radiodiffusione e lEditoria (1993) Relazione annuale al Parlamento per la Radiodiffusione. Roma: Presidenza del Consiglio dei Ministri, Dipartimento per lInformazione e lEditoria. Garante per la Radiodiffusione e lEditoria (1994) Relazione annuale al Parlamento per la Radiodiffusione. Roma: Presidenza del Consiglio dei Ministri, Dipartimento per lInformazione e lEditoria. Garante per la Radiodiffusione e lEditoria (1995) Relazione annuale al Parlamento per la Radiodiffusione. Roma: Presidenza del Consiglio dei Ministri, Dipartimento per lInformazione e lEditoria. Golfari, C. (1994) Oltre la Mamm`. Milano: Il Sole 24 ore Libri.

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Flavia Barca has an MA in Communication policy Studies from the City University, London. She is a freelance researcher, investigating in particular the political economy of communication. She is the author of Tv locali in Italia: organizzazione e programmi (Rome: Rai-Eri, 1997, co-authored with P. Novella) and Indies. Le societ` di produzione televisiva in Gran a Bretagne (Rome: Rai-Eri, 1998). Address: Via Alessandria 154, 00198 Rome, Italy. [email: f.barca@ ashnet.it]