openDemocracyUK

Panel three: the public service media content that merits support in the digital future and how this can be funded

David Elstein gives a blow-by-blow account of the third panel of the recent symposium of the Public Service Broadcasting forum
1 July 2010

Panel: Clare Enders (Enders Analysis), Helen Shaw (Athena Productions), Sunny Hundal (Liberal Conspiracy), Tony Curzon Price (openDemocracy)

CE gave an overview of the PSB environment.  This was not just TV – radio PSB is actually more heavily consumed, and is an important part of BBC reach.  What about media beyond the BBC?  Commercial radio is in poor shape, with revenues down to £500m, and 200 of the 300 stations never profitable.  Only a few of the independent local radio stations, and the few national stations, make money.  ITV, Channel 4 and five are collectively minimally profitable.  Since 2005, all media businesses have been in decline.  Beyond the Ofcom arena, national newspapers are barely profitable, even if regional newspapers still make some money, despite a 50% decline in classified and local advertising.

CE concluded that the market was barely surviving, and its delivery of PSB genres was in steep decline.  The positive value of spectrum in exchange for PSB supply had ended two years ago.  As a result, we need independent new supply and licence-fee funded PSB, which underpins democracy, more than ever.  The three tectonic plates of UK TV were drifting apart.  The advertiser-funded sector was in decline, both cyclical and structural, such that the 3% compound increase in the value of the licence fee created a growing chasm: a dangerous imbalance for the commercial sector.  The BBC’s espousal of DTT has persuaded the commercial PSB sector to follow into that technology, but they are still making losses there, and the commercial radio sector has made similar losses on its DAB investment.  Meanwhile, the third tectonic plate, pay-TV, is experiencing a 5.5% compound annual growth rate, and the BBC is struggling not to completely dominate the radio sector.

Steve Hewlett asked about the government’s stated hopes that de-regulation would come to the rescue of local media.  CE thought this was largely based on ignorance.  There was no pot of local advertising money sitting waiting.  Nor was there any trickle down from public sector spending to the commercial sector.  This was not an issue of regulation – it was simply a dream to imagine there were local media companies in the UK just waiting to be allowed to merge.  The US analogy was misleading.  The US has a population of 300 million, compared with our 60 million, and advertising revenues of $60 billion compared with our £3 billion: so a much higher ad revenue per head of population, as well as higher viewing hours per capita.  The US has a very different broadcasting history, and very different programme licensing systems.  US states are real economies.  Localities are distinct and distant – whereas in the UK she commuted weekly between London and Scotland.

CE noted that local newspapers in the UK had an average readership age of 55 – and even national newspapers had an average of 45 – so it was not surprising that their circulations had been in steady decline for a decade, as the Internet freed people from their localities.  Frodo and the shires is a Tory dream.

HS reported to the symposium on the state of PSB in Ireland, north and south.  As she said, “we know more about you than you know about us”.  She had worked for BBC Northern Ireland as well as for RTE radio.  Ireland is just very different from the UK.  Everyone in Ireland can receive UK channels.  RTE – unlike the BBC – was equally dependent on advertising and the licence fee, having been as high as 66% dependent on advertising before the licence fee had been raised and indexed, once the political class had re-engaged with RTE.  Having done road shows all over Ireland, she could report that everyone outside the UK was in awe of the BBC’s power and influence. 

HS explained that new legislation in Ireland had introduced a single regulator, and the emergence of a sound and vision funding scheme stemmed from the justifying of the licence fee increase.  50% of radio listening is local radio, not RTE.  The contestable fund was originally a one-pager in 2003, which just said that anyone could bid for 5% of the licence fee.  Specific types of content were sought, and BBC N Ireland could also bid, as they were visible to 90% of the population.  Likewise, Radio Ulster was excluded, as it failed that test.  Originally, RTE was hostile, but 80% of the £60m so far awarded has gone to RTE projects.  This is largely because the main commercial station, TV3, does not want to transmit the specified types of material in peak time.  51% of the radio cash has gone to community radio, which has been transformational.  Ireland now has an indie radio production sector, which has helped keep a commercially-minded RTE up to the mark. 

HS conceded that top-slicing was risky, and that 10% was probably the upper limit.  Building up the Broadcasting Authority of Ireland was a good way of maintaining a barrier against ministerial interference.  She also recognized that, without other money being made available, there was a danger of indies becoming over-dependent on the contestable fund.  Equally, in a recession, any kind of commercial investment becomes high risk.

SH said he had spent the last 15 years creating content for the web.  Liberal Conspiracy is the biggest left-wing blog, offering commentary on national and local politics and news.  The commercial imperative for such blogs is to build a community of regular returners to specific content.  These types of sites need to be interactive, so they are really a different model from broadcasting.  Originally, such communities were built round interests, but there were now personal communities on Twitter and Facebook.  The question was, how do you get that kind of blog known?  How do you push content out?  Huffington Post, with 20 million regular readers, is more popular than the New York Times website, with 17 million, despite having far less content.  Social media have now integrated with blogs, such that Twitter is the biggest source of clicks, followed by Facebook.

SH cited the Sun story about England tops being banned as an example of how the blogosphere worked.  It turned out that the original story was false, but 2,000 bloggers had turned the topic into a larger story that had not really run in the national media.  In his view, the question for the BBC was whether its brand would continue to be relevant enough in 10 or 20 years to justify the licence fee.  In the Internet world, aggregators are dominant, but he did not see that BBC content created a sense of community.  In his view, BBC content should be distributed for free to third party websites – in fact, all public service content should be distributed that way.  Currently, blogs like Liberal Conspiracy could only access BBC content laboriously, whereas US equivalents, like Talking Point Memo constantly recorded US cable and treated it as a common resource from which to spin off discussions.  This is how the BBC would be kept alive for another 20 years.

CE (amid general objections) protested that the BBC originated content which BBC Worldwide was tasked with using to raise additional funds.  SH insisted that the blogosphere was not in competition with the BBC: only trying to make it relevant – that is why giving away content made sense.

TCP noted that the BBC had indeed adopted new technology and the social media: that was not where the threat to its future lay.  The threat came from social changes.  He had only come into contact with the BBC from age 11, so was unusual: perhaps as a result, he does not own a television and does not pay the licence fee.  He can obtain any BBC content he needs to see through the i-player and radio.  He thought the phenomenon of magpie voluntarism showed there were “many publics”, and openDemocracy served one: that of people around the world who were independent, globally-minded, thoughtful and interested in the way democracy was unfolding.  Did this mean that openDemocracy was “public service”?  He saw such myriad organisations as like golf clubs: so where was the market failure that required a mandatory payment for PSB?

TCP asked what the nature was of the “public good” that the BBC purported to be that required special treatment.  After all, openDemocracy was a public good, a community good, telling the story of the world, capturing what Frank Field had described as the “spirit of English idealism”.  What was the narrative that the BBC represented?  Does the BBC reproduce its public?  As a means of funding this version of Britishness, the licence fee is mad: mandatory clubs are not clubs at all.  The i-player is not available outside the UK: how can that represent Britishness?  So, for instance, in the World Cup, the BBC struggled with its coverage because Britishness could not be represented by the England team. 

Steve Hewlett asked what types of content could justify public funding.  TCP said it depended on what kind of story you are telling.  For instance, to tell the story of democracy, you need to be independent and internationalist.  Above all, public funding can only be justified by a clear narrative.  He could not see how the BBC could deliver “the truth”, when it was so powerful, and monopolistic in its claim to public funding.  In reality, was it any more authoritative than Sky News?  You shouldn’t hand all the public funding to a single body – that was the madness of the licence fee.

SH noted that he was not seeking any public money, but the coverage of such issues as the 55% majority needed to change a government was an example of what Liberal Conspiracy did as public service.  He was simply interested in looking for non-bureaucratic ways of raising income.

TCP agreed: it was up to people to take responsibility for the funding of their own communities of interest.  Voluntary payments of £50 or £100 a year would allow those who couldn’t pay to continue to gain access.

CE pointed out that that was what newspapers do: sell content to 30 million people for up to £1 a day, but then provide that content free online.

John Dickson said that everything SH had been talking about was now happening on the Internet.  What had this to do with traditional media?  Look at the Gaza flotilla story. The Jerusalem Post had reported that 15 Twitterers had broken that story.  As for re-distribution of BBC content, Springwatch (on BBC2) was an interactive project.  What needed funding?  Look at the information clearing house, where there were 700,000 on the RSS feed, and 50,000 paying customers.

Sue Robertson (five) wondered whether RTE had stopped doing any types of programming themselves that could now be financed by the fund.

HS replied that RTE have to demonstrate “additionality” to their self-financed output to secure any funding: bids had to be for content that would not otherwise have been made.  Overall budgets had been affected by the decline in advertising, so there was more room for PSB.  She also pointed out that in the face of the cash downturn, RTE’s staff took a 5% pay cut and the DG took a 25% pay cut.  All RTE talent salaries are posted on-line.

Lis Howell (City University) wondered whether local sponsorship could help fund content.

CE was doubtful, in that what you were looking for was sustainability, which is what democracy needed – voluntarism was not enough.  She said she was in the Richard Hooper camp in terms of defining PSB narrowly, but was not sure about contestable funds – she wanted sustainable models, in London and Edinburgh, and elsewhere.  That said, she was aware that The Scotsman loses money.  Collectively, we spend too much on distribution and transmission, when what we need most is reliable finance.  In theory, content excellence should lead to barriers to entry, to maintain income.

SH was confident that the Internet would deliver sustainable economic models without subsidy.  The Daily Kos had five subs on $70k, and Talking Point Memo had just hired a team of journalists.  Local media need to understand how content is distributed.  Twitter is our life blood.

Steve Hewlett intervened to declare an interest as the former chairman of Channel M, which he thought might have got to break-even despite a very high cost base – if it had been lower, it might have survived, given the leverage of the Manchester Evening News.  It was not as expensive as ITV, but not as cheap as it should have been.  In his view, the IFNC model might well have worked.

Anthony Barnett wanted to go back to the question of the BBC.  Is it a monopoly?  If so, why was its reporting so suspect on issues like the database state and Parliamentary expenses?  He cited the instance of the Convention on Modern Liberty, which the BBC had refused to cover, at the same time as its licence fee campaign was using the slogan “we know where you live”.  Perhaps the controversy over its own managerial expenses had explained why the BBC followed, rather than led, in the Parliamentary expenses story.

Sylvia Harvey thanked openDemocracy for mounting an event that provided so much material to think about, even though she was shocked to hear that TCP did not have a television: not because this was wrong, but because on average people in the UK spent 25 hours a week watching television.  She had hoped that gaining understanding of the world involved more than personal experience.  It was a puzzle to her that he could question the need for the BBC when he sampled so little of its output.

Leon Mott (consultant) recalled from his time working for the BBC in Parliament reporting on the David Mills case during the negotiations for a licence fee settlement, even though his wife was Secretary of State.  His observation was also that websites had little compunction about ripping off BBC news sites (Sunny Hundal said no, they just provided links – it was a symbiotic arrangement!).

David Elstein (chair, openDemocracy) wanted to thank the panellists and the highly engaged audience in session 3 for their contributions.  He could not resist expanding the points that Anthony Barnett and CE had made.  The dangers of the BBC becoming the overwhelming recipient of public funding for content was illustrated by the episode where the BBC’s head of editorial policy had decreed that no BBC outlet, TV, radio or online, could make further reference to the sexuality of Peter Mandelson, after Mathew Parris had outed the Secretary of State in a BBC programme.

Richard Hooper had referred to the possibility of the BBC being funded by voluntary subscription.  TCP had submitted a Freedom of Information Act request last October to the BBC, asking for any reports or research the BBC had commissioned on this subject in recent years.  Answer there has been none,  and we are now 8 months past the normal deadline for a response.

Finally, as CE had said, local TV stations in North America had discreet populations to address.  They also had the ability to buy “sustaining” programming (TV series in second run, or new Oprahs) on a station by station basis, around which they could build their local coverage.  This was simply not possible in the UK, where a local station would have to buy such programming at national prices, which were prohibitive.  Jeremy Hunt’s vision of 5 local TV stations in Birmingham, England (to match the 5 in Birmingham, Alabama) was a non-starter.

DE was grateful to all participants in the symposium, on the panels and in the audience.  We had had a fantastic day, and he was overwhelmed by the quality of the debate.  His only regret was the £25 fee - £250 would still have secured good value for money.  He felt there was a huge amount to digest, and was delighted that, thanks to the videographers from City University, all the proceedings would soon be available on the openDemocracy website, where anyone – including Sunny – could steal it under our creative commons policy.  He wanted to offer particular thanks to Lis Howell for organising the facilities at City, and to Steve Hewlett for his masterful chairmanship of all three sessions.

End of session three. Read and watch session one and session two.

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