The BBC Licence Fee Settlement

It’s still really hard to quite get my head around how the BBC licence fee settlement plays out.
The quickest way to get a handle on what the BBC is being asked to do, is to read the letter to the BBC Trust from the DCMS website.
The key elements of the statement are:

  • The licence fee remains at its current level for the next six years (until 2016/2017), at £145.50
  • The BBC will fund the World Service, taking over from the Foreign Office.
  • The BBC will part fund S4C from 2013, although that channel’s budget will fall by 25%.
  • The BBC will fund BBC Monitoring, taking over from the government.
  • The BBC will fund a pilot rural broadband rollout.
  • The BBC will fund some local TV services.

I suspect that many at the BBC are still trying to get their heads around what this all means, although it’s fairly straightforward that this means a 16% reduction in costs. This isn’t nice, but is possibly better than expected, especially given the rumours surrounding the BBC having to fund the licence fees of the over 75s.
The real game-changer has to be the BBC taking on funding of the World Service. Currently the World Service broadcasts in 32 languages around the world on a wide range of platforms. If you’re someone like me, you tuned your Sony shortwave radio into the World Service to hear what was going on, and then perhaps you slightly surprised to discover the British news only played a small proportion of what the service talked about.
The BBC World Service is an invaluable public face of Britain around the world. While some may think that it’s a leftover from our Imperial past, I simply don’t believe that this is the case.
While the BBC paying for the World Service simplifies some of those conversations I’ve had with people from other countries when I try to explain that the Government doesn’t run the BBC (aside from the World Service) – something that’s sometimes not clear to people who come from, say, Italy. Overall, it endangers continued support for some of those valuable services. That means Persian, Chinese, Arabic, Spanish, Somali, Urdu, Kyrgyz and many more. The problem comes when the BBC is next trying to save some money. The licence fee paying proportion of the Kyrgyz speaking audience is likely to be very small. It becomes very hard to support that service when its largely directed into another part of the world. I’m sure that BBC Trust members and Mark Thompson currently have no desire to cut it, or any other service. But what happens when the next savings have to be made? It’d be less noticeable than reducing the hours of childrens television or making less Sunday night drama.
The S4C funding is more complicated, and I suspect that there’ll be legal challenges to what this funding settlement suggests. I’m not Welsh and I don’t speak Welsh, so I’m not in position to say whether it’s a good or a bad thing – although clearly nobody likes seeing their budget cut. S4C has been in some trouble recently, and I know viewing figures aren’t great. Of course a lot of that is due to fundamental changes surrounding digital TV. In the analogue world, most viewers in Wales watched some S4C even if they didn’t speak Welsh, since it was home to Channel 4 programmes too (indeed, when I lived in Bath, I used S4C as a kind of Channel 4 + “a bit – maybe a few hours, maybe a day” service to catch up with shows you missed).
BBC Monitoring is a great service, but if the licence fee is paying for it, then it really demands that licence fee payers actually get access to what they’re collecting and collating. Currently it’s data is available to the Government and private subscribers. If I’m paying for it, then I should have access to it. And that might break the service’s funding model.
Rolling our rural broadband is very important, since without full activity, it does mean that people are discriminated against in a technology economy, based solely upon where they live. But getting the BBC to pay for it is really shifting cash out of other ministries costs as part of the whole spending review. While broadband can and does deliver digital media, there’s no doubt that this is using the BBC licence fee for anything the government feels like. The problem is that next time there’s an agreement to be made, anything and everything – broadcasting related or not – will be looking towards that cash.
But the biggest waste of money, even if it’s the smallest actual amount, is the £25-30m that the BBC is being forced to spend on local television initiatives. It just seems ill-thought out on so many levels. This is Jeremy Hunt’s baby. He’s been looking at ways to build local television stations for a while now, although it’s hard to see how this will work. Just over a million pounds each, for twenty services, is basically nothing in television terms. Even in a world of Flip cameras and editing in iMovie, that’s not going to go very far. I’ll be honest – I don’t understand how these services will work. Nobody has really thought through the logistics of EPG positions. In any case, in the second decade of the 21st century, we should surely be looking at IP delivery. There’s no bandwidth for these services on Freeview since it’s a model nearly completely based on nationwide coverage, and now that YouView has been approved, and with services like Google TV and Apple TV meaning that getting IP delivered programming on your television is easier than ever before, this seems like the natural home. At this point, you have to ask whether it actually needs to be state supported. While I think that Hunt’s previous comparisons of Birmingham, UK with Birrmingham, Alabama were utterly bogus, US television is able to support local news services in major markets. London should be capable of supporting a service – perhaps piggybacking on what ITV does regionally. However, I don’t see why the state should be subsidising these services. The state doesn’t support commercial radio or local newspapers. So why TV?
I suppose that we should be thankful that the BBC has not seen its costs cut further, and that probably explains why they’ve agreed to what they have done. But it does leave a very uneasy taste in the mouth.
These are my personal views and do not reflect those of my employer. The settlement letter linked to above does mention BBC National DAB rollout plans.


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