The community television sector has been given the offer of an extra year to find an online business model before losing access to the television spectrum it currently shares with the public and commercial broadcasters. But Sydney community TV station TVS has begun a round of redundancies as its main funder, the University of Western Sydney, pushes the station towards a new model.

In September last year, Malcolm Turnbull used a speech at a conference held by the Australian Communications and Media Authority to announce the impending loss of spectrum allocated to the community TV sector. “The best outcome for community television is that in future it uses the internet as its distribution platform,” he said. But the announcement blindsided the sector — key industry figures and station managers told Crikey they had no idea the government was about to make the announcement. They argued they needed more than 15 months to figure out a way to exist solely online.

The sector launched a public campaign and lobbied the government on the need for more time to figure out a transition.

Crikey understands that last month Turnbull indicated he was open to granting the stations an extra year, on a case-by-case basis. The stations were given until October 31 to let the Communications Department know whether they accepted the offer, which required them to meet certain conditions. In a statement, a department spokesperson said the conditions were “designed … to assist their transition” to online broadcast. While the minister’s office wasn’t able to provide more detail on those conditions, Crikey understands they mainly involve accepting the move to digital broadcast by telling partners and stakeholders they were moving online at the end of 2016 and no longer petitioning for an extension to their licences. The stations are also required to have online streaming models in place by the end of 2015.

Australia’s community television stations operate independently, and all have yet to make formal decisions through their boards about whether to accept the conditions tied to the extension. A meeting of industry body the Australian Community Television Alliance is to be held in Melbourne next Monday, and many of the station managers are anticipating this will be their best chance to confer with other stations. But several of the stations Crikey spoke to indicated they were leaning towards accepting the offer.

“Not that long ago we weren’t sure we’d get anything,” Melbourne’s Channel 31 operations manager Matthew Field told Crikey. “The minister listened — we’re pretty thankful for that.”

Meanwhile, Brisbane’s 31 digital station manager Scott Black described the offer as “better than nothing”. He said that although he expected the station would accept the offer, he had concerns about the conditions attached. Currently, the Labor opposition is saying the sector should be given three years to transition, which is also the Australian Community Television Alliance’s preferred time frame. Accepting the offer would mean locking the stations in to moving online by 2016, which is an election year. “It doesn’t give us much wiggle room,” Black said. “What if the government gets knocked out of office but we’ve signed something saying we’re not going to ask for more time?”

“We’re trying to create a business model, to a deadline, that hasn’t been done in Australia before,” Black added. “We have been putting stuff online, and some of us are already streaming. We’re trying to move forward. But it’s hardly ideal.”

For Sydney’s TVS, the situation is moving quickly. Crikey understands the University of Western Sydney, which houses and funds the station, has decided a radical restructure is necessary at the end of the year. To this end, the three most senior of the station’s six staff have been made redundant in the past fortnight. Several insiders have painted this as UWS moving away from supporting the station. But TVS boss Rachel Bentley, also a senior lecturer in media at the university, disputed that characterisation, telling Crikey this morning that while the station was’t in a position to announce its plans for next year, it would be better to call the changes a “restructure”.

“We have let some staff go. But if we are to fully explore, with backing of community sponsors and UWS, how to be an online channel, we need to internally make a lot of changes.” Bentley has a meeting with the station’s producers scheduled for August 31, followed by a meeting of the station’s board in September. It’s expected a more concrete idea of how the station will change will emerge then.

In a statement, the Department of Communications reiterated that in its view, the future for community television was through online transmission. But, the spokesperson said, provided the commercial and national broadcasters were willing to defer trials of new broadcasting standards until 2017 (their desire for the spectrum has been the department’s reason for kicking community TV off), the minister was willing to give the stations a further 12 months access to the spectrum, “if they are able to satisfy certain conditions by 31 October 2015 that are designed, among others, to assist their transition”.

“Any CTV broadcaster unable to satisfy these conditions will need to cease their terrestrial transmission no later than 31 December 2015.”