Spain’s Regional TV in crisis

The advertising crisis, along with tighter budgets and a significant reduction of state subsidies, are leading Spanish Regional state-owned TV stations (financed by a mix of ad revenues and state subsidies) to dramatic financial cuts; the closure of some subsidiary channels, the suspension of satellite transmissions and redundancies.

Catalonian TV channel TV3 has announced that it will close down two of its six TV channels –probably the sports channel Esport 3 and HD channel TV3HD- following the Regional Government reduction by over 13 per cent of its state subsidies, from €300 million to €260 million. Even, the transmission of the Spanish Football League has been put into question. RTPA, the Regional TV in Asturias, is meeting creditors following the Regional authority’s cancelation of a subsidy of €13.2 million.

Several Regional stations have decided to stop their satellite transmissions to save money. The Regional channel in Extremadura, west of Spain, has just announced that it will drop its International version of the channel, so far available through Astra to 190 countries, from December 31. Other Regional channels in Aragon, north east of Spain, Asturias, in the north, or Valencia, in the east of the country, have also suspended their satellite broadcasts through Astra or Hispasat. With this measure, Aragon TV, for example is saving €1 million, 2 per cent of its budget. RTVV, the Regional channel in Valencia, has announced plans to reduce its staff and some other measures to cut costs as it is one of the most indebted Regional TV channel with a debt of €1.100 billion, followed by Madrid-based Telemadrid with a debt of €250 million.

Overall, the existing 13 state-owned Regional channels in the country have a debt of €2,500 million, with an average cost of €84 per home, according to a report from the consultancy firm Deloitte. Over the last year, their financial situation has got worse with ad revenues falling significantly, from €900 million in 2008 to hardly €250 million in 2010 and only €153 million in the first nine months of 2011. Regional Governments are also cutting their subsidies, from €851 million in 2009 to E808 in 2010.

With the new Government, the Regional TV model in Spain is set to change. The new Administration is for the privatisation of these public TV channels and even the creation of a single Regional TV channel with a nationwide distribution and with Regional broadcasts at certain times. Another alternative is applying the RTVE’s model in the Regional TV channels and ban them from broadcasting advertising. In any case, the new Administration will have to change the Regional TV law to reorganise the Regional TV map and pave the way for a new consolidation in the sector.

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