Some time ago I posted on the announced privatization of RAI, the Italian public service broadcaster. In 2004, the Gasparri law reforming the audiovisual sector in Italy opened the way to a partial privatization of RAI which was to take place (after some delays) before the end of this year. Privatization of the public broadcaster has been a highly controversial issue, both within and outside of Italy. There were fears that Prime Minister Silvio Berlusconi would use the privatisation of RAI to gain an even firmer grip over Italian media.

Well, with Italy, one never knows and last Friday privatization plans were brought to a halt. The FT reported that plans have been suspended as a result of the announcement made by the broadcaster�s director general Alfredo Meocci that RAI would make an �80 million ($96m, �54m) loss next year.

Mr. Meocci warned that, unless structural changes are made, Italy could end up with a �piccola Rai� (small RAI). His recipe for improvement is quite simple: more money. He suggests an adjustment of the licence fee to the public service mission and a change in current advertising limits, so that RAI can compete in the market. In return, he is ready to implement accounting separation to achieve more transparency. How considerate.

Is an inefficient and likely anticompetitive public broadcaster a better option than yet another Berlusconised media outlet? I guess so.