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Three ways to evade Dorrell's controls

Perri 6.,Horsman
Tuesday 23 May 1995 23:02 BST
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Suppose you are a newspaper or television company. You want to build market share and benefit from economies of scale. How do you get around the new rules?

l The simplest way is to invest in media that are not covered by legislation. That means multimedia, the whole range of new-age products and services promised along the information superhighway. Mr Dorrell deliberately left these out, hoping to encourage further investment here.

l You could avoid the ownership restrictions by establishing ingenious links between companies. For example, you could have two kinds of shares in your joint venture, some with voting power and some without. The firm most vulnerable to the ownership rules could take the non- voting stock and reap the dividends none the less. Alternatively, commercial alliances could allow partners to corner a larger market share. You could always go into partnership with a continental European firm that doesn't already fall foul of the rules.

l If it's television you're after, Mr Dorrell has left you a big loophole. Terrestrial television may be off-limits, but cable and satellite are wide open.

Perri 6 and Mathew Horsman

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