MADRID, May 7 (Reuters) - Spain's Telecinco TL5.MC said on Thursday it welcomed a government plan to cut advertising at state TV, but was not sure if it would mean short term advertising revenues would be transferred to private companies.
“It’s a longer term for me. In the medium term when the economic situation in the market recovers we will (see) a positive effect on the private broadcasters revenues,” Telecinco’s general manager Massimo Musolino told a conference call after first quarter results. [ID:nL7525915]
“It is a very positive change for the sector,” he said.
Shares in private TV companies Telecinco and Antena 3 A3TV.MC have been rallying on hopes that their advertising revenues will rise once state TV is no longer touting for the same business. Some analysts doubt this will be the case.
The funding shortfall -- around 500 million euros ($666.1 million) -- at state TV will be covered by charges on revenue at TV and telecoms firms, something long rumoured which could be approved by Spain’s cabinet as early as this week.
Musolino said the government’s funding proposal for state TV would be broken down with 45 percent coming from direct subsidies and 20 percent coming from fees charged to media and telecoms firms for use of the broadcasting spectrum.
Another 24 percent would come from a 0.9 percent levy on telecoms firms' revenues -- such as Telefonica TEF.MC -- while 10 percent will come from private TV firms which will pay 3 percent of their revenues.
The remaining 1 percent will come from commercial activities at state TV.
The move aims to counterbalance the removal of advertising at the public TV corporation, this year expected to bring in about 477 million euros. (Reporting by Robert Hetz; Writing by Elisabeth O’Leary; Editing by Sharon Lindores)
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