1.  The news media have a vital role in a democracy. They report the news from home and overseas; they expose injustice; they challenge government and officialdom and they set out a huge range of views. Our concern in this inquiry is how to ensure the news media can continue to fulfil this role and in particular to examine the impact of ownership on the news media. A media concentrated in too few hands could have the effect of limiting the freedom of expression and diversity of view which is the hallmark of a democratic state. This report examines whether ownership has become more concentrated, what impact ownership can have on news and what options are open to the Government to ensure that the British public has a proper choice of accurate and high quality news.

2.  Throughout most of the twentieth century people relied on newspapers and a limited number of radio and television channels for their news. However, technological advances including the advent of the internet and new electronic means of distribution have resulted in a proliferation of news sources. News is now available on a multitude of websites, some run by traditional news providers and some run by new incumbents or even by individual "bloggers" who comment on the news and occasionally even break stories. Satellite, cable and now digital television has increased the number of television channels and in turn the number of news channels. At the same time increased choice has fragmented news audiences and advertising revenues and news providers have had to create new business models in an uncertain environment.

3.  While there has been a proliferation of ways to access the news, there has not been a corresponding expansion in professional journalism. The market pressures faced by news organisations have led many to scale back on investment in journalism and news gathering. Much of the news available on the internet, on the new television channels and elsewhere is repackaged from other sources. The number of specialist correspondents seems to be shrinking rather than growing to keep pace with new trends in news provision. Foreign correspondents have been cut back by most news organisations.

4.  Media ownership is regulated differently to ownership of most other business activities because of the media's place in a healthy democracy. They provide the range of voices and opinions that informs the public, influences opinion, and supports political debate. Regulation to ensure a plurality of media ownership is therefore particularly aimed at ensuring a diversity of news provision. Media mergers and acquisitions are currently subject to a special regime of regulation above and beyond general competition law. Specifically they can be subject to a test of their impact on the public interest.

5.  As for content, the regulatory requirements for broadcasters are fundamentally different to those for newspapers. Broadcast news, on both television and radio, has traditionally been provided either by the publicly funded BBC or the commercial Public Service Broadcasters (PSBs) who have received indirect subsidies in return for undertaking certain programming duties, such as children's, news and regional programming. Government and Parliament are able to influence the quantity, scheduling and quality of broadcast news on the PSBs. The industry has a statutory regulator, Ofcom, although the BBC is still responsible for regulating most aspects of its own content through the BBC Trust. Even the new broadcast news providers, who do not have PSB status and are not universally available, are licensed by Ofcom and are required to meet statutory obligations of impartiality. The diversity and quality of broadcast news is thus affected not only by ownership regulation but also by statutory regulation of content and standards.

6.  By contrast the UK has never had statutory regulation of newspaper content or standards. The only way that a diversity of voices in newspaper news has been regulated is through ownership regulation. This report examines both media ownership regulation and the regulation of content and standards of broadcast news.

7.  The emergence of the internet as a source of news has brought a new and largely unregulated medium into play. Producers of online content are subject to the same broad legal duties as print publishers. However, internet content is produced across the world and the impact of these liabilities is constrained by national jurisdictions, providers outside the UK's reach do not need to comply with UK rules. The challenge of regulating millions of content providers and millions of access points around the world adds to the practical difficulties of regulating internet content, even if it was deemed desirable. Regulating the ownership of internet news providers is complicated by the international nature of the web and many of the organisations that provide news websites.

8.  Before focusing on the ownership of news media we started our inquiry by examining current trends in news production and consumption. It is important to understand the context in which media companies are operating before examining ownership patterns.

9.  The membership of the Committee is set out in appendix one, and our two Calls for Evidence are at appendix three. We received valuable written and oral evidence from the witnesses listed in appendix two. During the course of our inquiry we visited New York and Washington DC to look at news provision and regulation in the United States. We wish to put on record our warm thanks to all those who have assisted us in our work.

10.  Our Specialist Advisers for this inquiry were Professor Steven Barnett, Professor of Communications at the University of Westminster; and Professor Mike Feintuck, Director of the Law School at the University of Hull. We have been very fortunate to benefit from their expertise.