Lord Hall’s modest proposal for the BBC

While Charter Review has been marked by a clamour over cuts to programmes and services, less attention has been paid to a BBC proposal which could have equally far-reaching implications.  

Mike Flood Page
2 September 2015

Image: Flickr / Lis Ferla

The BBC’s response to the Government’s Charter Review Green Paper expected within weeks, is slated to include a radical plan from the Director General, Tony Hall to open up “the BBC to more competition”. There are fears it could become a prelude to privatisation of much of the BBC’s programme-making, leaving a shrunken BBC. 

Hall wants to sweep away the existing quota system which reserves 50% of drama, entertainment and features for the BBC’s in-house programme makers. In future all programmes would be opened up competition from private independent producers with the exception of News, Sport, Current Affairs and Children’s programming which will be exempt. The quid pro quo for the BBC’s beleaguered producers is that some two thousand of them will become part of a new “arms length”, “more commercial” outfit, BBC Studios which would be free to compete for work in the open market in the UK and globally.

The aim, according to Hall, is “to drive up standards and drive down costs”; but it is also intended to address the virtual disappearance of a thriving creative sector of small to medium sized production houses that the BBC quota system was designed to stimulate. 

This system established in the last Charter guarantees that 50% of all BBC TV output goes to in-house programme makers; 25% to independent TV companies, and the remaining 25% is open to competition from either. 

However, in the last ten years the independent sector has seen rapid consolidation. We like to boast that we have the best TV in the world. What some viewers may be unaware of is that now much of BBC output is made by a handful of foreign owned super-indies (mainly American), who have swallowed up many of the best British producers in a spate of take-overs and acquisitions. The indie market is now dominated by hyphenated behemoths such as Endemol-Shine producers of MasterChef and Bad Education, Liberty Global-Discovery who make the Call the Midwife and Victorian Farm, and Warner Brothers responsible for Waterloo Road, New Tricks and Who Do You Think You Are?  The only independent UK TV producer of scale left standing is ITV, and that is rumoured to be up for sale. 

The outcome the BBC Trust notes has been “a gradual shift in the balance of power, away from the broadcasters and towards the bigger global producers.” The BBC once the 800-pound gorilla of UK broadcasting, now looks more like a media minnow. 

Tony Hall argues that the way the quota rules work mean a system designed to encourage new ideas and new talent is rewarding old favourites, reducing choice and tying the hands of BBC commissioners and Channel Controllers. 

The BBC Studios proposal aims to tackle another issue. As media platforms proliferate, success in TV today is more and more about creating great programmes. Owning valuable intellectual property is key. That means having the right talent. BBC production struggles to attract the best talent because it can’t offer the right incentives. If a BBC producer comes up with a great idea and the BBC turns it down, they have nowhere else to go. Under the BBC Studios plan they would be free to pitch it to any other broadcaster, UK or global. 

This is the latest stage in a process which began with the introduction of the first BBC independent quota programmes in 1990. Since then the BBC has embraced market values, and the language and practice of consumer choice, efficiency and competition.   

The independent producers’ body PACT has welcomed the opportunity to grab a slice of Bake-Off, or Dr Who, but is worried about the prospect of having to compete with BBC Studios head-on. Chief Executive John McVay complains that BBC Studios might enjoy an unfair competitive advantage by virtue of its close relationship with commissioners and current tenancy of valuable franchises such as EastEnders.    

The unions have expressed hostility to the plan to scrap quotas fearing it may mean cost-cutting and increased job insecurity. They warn that BBC Studios might prove a prelude to outright privatisation. 

This goes to the heart of the issue. What is meant by “arms length” and “more commercial”? Where would the new BBC Studios sit within the Corporation’s organisation chart: in public service or the commercial arm, BBC Worldwide? If the latter might the Government, already eyeing up a possible sale of Channel 4, be tempted to privatise it entirely, leaving a much smaller BBC with even less clout in the market place for bold new ideas? 

What will happen next? 

The regulator, the BBC Trust, supports ending quotas, but has suggested that the Studios proposal would need to be put through its own possibly prolonged regulatory processes. This might be interpreted as kicking BBC Studios into the long grass. This puts the BBC in a bind. Tony Hall has made it clear that the two proposals are a package and can’t be taken separately.

Which way will the BBC jump? We should learn with its response to the Government’s Green Paper. Anyone who cares about the future of British television would be well advised to watch this space.

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