Broadcaster shuts as Spain local TV boom faces bust

Video camera's screen as journalists gather in Palencia Workers at a Spanish television channel fought against its closure Wednesday after authorities said it was financially doomed, the latest casualty of Spain's regional cash crisis. Five years after the busting of the real estate boom that hurled Spain into recession, analysts say the closure of Valencia broadcaster RTVV could herald the bursting of another bubble: Spain's 17 regional television stations.
Leaders of the eastern region defended their decision to shut down the public television and radio service RTVV, saying they were forced to do so when a court ruled the company could not fire 1,000 workers to try and stay afloat.
Regional President Alberto Fabra, of Spain's governing conservative Popular Party, said the shutdown was "non-negotiable".
"The court ruling leaves us no other option but to close down the station because we cannot bear the cost," Fabra told reporters on Wednesday.
"We do not have the 40 million euros required to take back those 1,000 workers, because we need that money to maintain education, health and social services," he added.
Unions and political opponents scorned the government's explanation.
"Playing off public television against essential services is shameful," said the regional leader of the opposition Socialist Party, Ximo Puig, in a statement, alleging the closure was politically motivated.
The secretary of the works council representing RTVV workers, Jose Alcaniz, told AFP: "The ruling demands the reinstatement of the workers and we are going to use all political and judicial means to achieve that."
Tuesday's announcement to shut the channel primarily affected the broadcaster's total 1,700 staff and audiences in a region of five million people, but it echoed the impact of spending cuts in Spain's public services overall.
Fighting to stabilise the public finances, Spain's central government has imposed tough budget targets on the 17 regional authorities. Under the latest central government targets, they must make eight billion euros in savings in 2014 and 2015.
Valencia is the most heavily indebted of the regions, having spent big during a decade-long building bubble and struggled after the boom went bust in 2008.
Its debts in late June equalled nearly 30 percent of its gross domestic product at 29 billion euros.
Analysts warned that other regional broadcasters could go the same way as RTVV.
Its closure sets "a serious precedent which puts at risk the existence of regional television stations in Spain," warned Manuel Campo Vidal, president of the non-profit Academy of Television Arts and Sciences.
Fernando Cano, editor of media news site prnoticias.com, warned that "exactly the same thing could happen in Madrid," with the regional channel Telemadrid. It faces a similar crisis and is seeking to lay off 861 of its 1,170 staff.
Alcaniz said he expected the legal proceedings needed to shut down RTVV to take at least two months, "and in that time we will certainly stop it", with the channel expected to function normally in the meantime.
He echoed the allegations of political motives behind the closure.
Cano said that the reliance on public funds of the regional channels, which flourished in the decade-long boom from the late 1990s, undermines their impartiality.
"They have only survived because of public subsidies and they have grown thanks to them and to regional governments that have tried to use them as a political tool," said Cano.
"This situation was predictable because the television stations are deep in debt," Cano said, adding that advertising revenues have fallen 60 percent since 2007.
"Ninety percent of the budget of these television stations came from the region, which is ultimately state money, so this model is unsustainable."
Source: AFP