The Future of the BBC

[french frank]

If you made BBC subscription channel based, I think you would still get between 5 and 10 million subscribers to BBC 4.

You mean subscribing to a single channel? And more for the other channels?

[Sir Velo]

You mean subscribing to a single channel? And more for the other channels?

Why not? That's barely £6 a month. My Sky subscription for TV alone is approx. £30 a month (excluding all the freeview channels of course) and that is by no means the most expensive package!

If you think about it, if all you watched was BBC 4, this would work out cheaper than the current all in fee. If you followed Sky's methodology for example, you'd have £75 for one channel; £120 for two channels; or £150 for everything. Clearly, detailed budgeting would be needed, but that's the underlying principle.

[Lat-Literal]

There may well be devil in the detail but given what could have happened I am very relieved. An ongoing licence is imperative and the reason is very simple. The BBC is not in essence a competitive broadcasting organisation. It is a national service. So rather than being in the same category as ITV, Sky etc, it is really in the same category as the Royal Family, Parliament, the legal system, the security services, the education system and the NHS. How bizarre then that having dumbed down to be competitive as was urged by our political masters for many years, the new political requirement is in some ways that it should not compete to the same extent. Eh? Well, all the talk now is that it should provide something distinct from the content of those who are rivals to each other in the market. There is talk of a raising of standards and greater inclusion of under-represented elements of the population to support national cohesion. Such objectives could underpin the arguments of any friends of Radio 3. Obviously the Government bowed to pressures. It was on a very different and slightly sinister course but I think as with many things it didn't know what it truly wanted. That has resulted in the pleasingly unexpected. Let it muddle on, I say.

[french frank]

Why not? That's barely £6 a month. My Sky subscription for TV alone is approx. £30 a month (excluding all the freeview channels of course) and that is by no means the most expensive package!

Hmmm. That seems an insane amount to be paying for television, but then, I shan't even apply for a free licence when the time comes if the BBC now has to finance it. If it still came out of general taxation and the BBC benefited by £145, I might have considered it …

You are clearly speaking as someone who has the money to pay out on entertainment and is willing to do so. As with gambling, many others will be paying out what they can't afford.

The figures you quoted are bonkers: depending on how the system worked BBC Four would cost much less than you quote. But, as with Radio 3, the service on average has not merely fewer viewers/listeners, but they watch/listen for a negligible amount of time. People who listen to Radio 3 for, say, 20 hours a week might well find a subscription service very cheap. But anyone who listened for less than 10 hours pw might well wonder whether it was worth it. At the moment Radio 3 has an average of 2m listeners pw - but the average amount of listening is about 6 hours. What percentage of your 2m will fork out for a few hours a week?

BBC Four is in much the same position. On average, a viewer watches BBC Four for 'only a few hours each month' (BBC Trust).

I can't see much of the population picking out all the services it might want to watch/listen to and paying each month/quarter/year or whatever in case there's a programme they might want to watch occasionally. The well-heeled middle-classes might, I suppose, but it might persuade people to rethink their relationship with their TV sets.

[Gordon]

Subscription is a very good scheme for raising and protecting revenues and providing more flexibility for viewers and listeners [the real commercials have to use it] but has been discussed and rejected for Free-To-Air public services in the past as being too complex to manage. On this occasion the decision would/should have been made a very long time ago in order to have it ready and working in time for a new charter [software project???]. There is a bit of discussion in the White Paper along with some viewer feedback.

Subscription is somewhat less reliable as a revenue stream because it can vary at the constant whim of subscribers. “Real” commercials [not ITV] like Sky have to live with that and design their systems to minimise churn. They also have to be profitable and have to make sure that most if not all their content is popular and more than covers its costs or can be treated as a loss leader. It is obvious why they offer Sports and Movies and are prepared to pay top dollar for the rights.

One problem of introducing a new subscription method for the FTA services on Freeview is that over 75 Million TV sets now out in the market have no means whatever of preventing viewing by people who don't have a sub [otherwise known as the Licence Fee]. The FTA Public Service terrestrial broadcasting system we have had since 1922/1936 has always, by definition, been free of access control restrictions. Revenue protection in the case of the licence fee was always a global on-off separate administrative collection system with legal support - ITV is in a good position as long as Advertising revenues hold up but even there there is variability.

"Connected" TVs which have IP addresses and have two way communication with the content source can be checked for location - eg for territorial rights issues - but the IP address could also be used to identify an individual set or box. Viewing on a computer is even better because in addition to the IP address there is flexible software and cookie facility to control access against a database of subscribers - similar to what cable TV companies do. However these are hackable and would need protection. Also a household having more than one computer/tablet etc each having its IP address would need more than one subscription unless the system is flexible enough to bundle computers and other connected viewing platforms together. An extra charge could be made for each added device.

A flexible subscription scheme to allow individual people to choose what they want makes an Access Control system even more complex than a simple ALL On/ALL Off gateway, especially if subscribers want to change their subs from time to time. It needs a tamper proof and secure intelligence in the box. The original commercial company that started Digital Terrestrial TV in the UK back in 1997 - OnDigital - died in 2002 with massive losses because its Access Control system was hacked [allegedly by Sky's Access Control company] and its revenues dwindled. That failure caused Freeview - but a remnant called TopUpTV remains as a pay element on the Freeview platform but you need their box to get at it. In the case of Sky they have much better security via the gate-keeping smart card in the box which has detailed knowledge of the subscriber and Virgin have a similar system of individualising services. Sky spend a fortune protecting that smart card which is part of a heavy duty encryption system - so much so that it has to be approved by state security agencies, GCHQ in the UK.

To add a secure protection system to our current system means designing a simple low cost method of adding flexible Access Control mechanism which means the subs charged would have to cover the cost of this - the service provider would bundle it into delivery costs like broadband modems. Technically it is not clear how to add this facility to a simple TV set but the DVB did, after a struggle with set makers, develop a Common Interface [try a google on DVB Common Interface] for TVs that would accept an external module to deal with access control. How widely that is now installed in modren TV sets I don;t know but the intent was clear ack then. A box containing the secure electronics/smart card would take in the aerial lead and then deliver an HDMI or similar output to the TV, just like a Sky box does, but only those programmes that the subscriber has paid for, and another to a recorder if such a thing is not built in. That box would also need to be connected to the phone line/WiFi so that software updates can be made and viewer habits can be collected and reported - as Sky and Virgin do. Then think about the broadcaster end and the management system needed and then about how you would start such a scheme going on the scale of the BBC's output and consumption. Blank screens?

One could provide at lower licence fee the basics of the public services for free without a box [like FreeSat perhaps] and then if you want more then you have to buy a subscription and get a box. It could be seen as socially divisive to do that in a Public Service, indeed it destroys the whole point of it being a Public Service.

SKy have that technology proven so why not adopt it all for an all new “FreeviewSecure™”? But then you can’t call it Freeview any more can you ? and it has lost its original Public Service role. While we’re at it why not let Sky manage it all too, I’m sure they would jump at the chance?

As a tailpiece to all this and considering that the new charter will run to 2027, by then the mobiles will almost certainly have been given all the spectrum used by Freeview. No more terrestrial TV aka Freeview. Then we'll be getting our TV via subscription anyway but paying the mobile service provider instead. Then where is Public Service?

Already OfCom has allocated more UHF currently carrying Freeview to the mobiles and a big re-engineering project is being planned now to move lots of Freeview transmissions by Q1 2020, with the attendant need for viewers to fiddle with their TVs again and maybe have to get another aerial. One area at risk of wholesale change is around Bristol because Mendip transmitter is one that will need to be modified, as will Oxford and Winter Hill. Interested parties should google "OfCom 700 MHz clearance consultations". There are two, one closes for responses today.

[Lat-Literal]

The problem with subscription is that it doesn't require citizens to fund the BBC. In these times of citizenship tests to minimise the scope for individuals to be at odds with the values of the country, of devolved powers which diminish the sense of broader national cohesion, and of the possibility of leaving the EU which provides platforms for Britain to have a global voice, there is a national need for a distinctive broadcaster to bridge internal divisions and to be a strong voice for Britain across the world. We should all pay for it.

(Well, maybe not the over 75s but everyone else)

[aeolium]

Whilst I can see that that might resolve the problems you perceive in the Licence Fee, I'm not sure how it would deal with the issue of the money paid to the BBC being decided by the Government:

The funding would have to be ring-fenced or hypothecated in some way, with any periodic reviews conducted by, say, a joint committee of both Houses of Parliament (so not entirely free of external control but at least far better than the licence fee level being at the whim of the executive without any parliamentary audit). Finland's system has a ring-fenced charge I think. A hypothecated tax would of course not avoid the charge of being compulsory but would at least be progressive and the poorest would not pay anything.

[vinteuil]

An ongoing licence is imperative and the reason is very simple. The BBC is not in essence a competitive broadcasting organisation. It is a national service. So rather than being in the same category as ITV, Sky etc, it is really in the same category as the Royal Family, Parliament, the legal system, the security services, the education system and the NHS..

... I like your thinking - but it wd lead me to think that the BBC shd be funded from general taxation...

[Lat-Literal]

... I like your thinking - but it wd lead me to think that the BBC shd be funded from general taxation...

That's better than the other non-licence options, yes.

[LHC]

Not necessarily. If you made BBC subscription channel based, I think you would still get between 5 and 10 million subscribers to BBC 4. If you average it at say 10 million subscribers at £75 per head = £750m revenue from subscription alone. Don't forget the BBC sells a great many of its programmes overseas or on DVD etc. Many programmes are also collaborative ventures, so that the BBC does not bear the total cost of production.

I should also add that coming up with a totally arbitrary figure of £75 is proportionately way in excess of the channel's current share of the licence fee.

I think you over-estimate by a considerable margin the numbers who would subscribe to BBC4. Its most popular programme last week was Hinterland, with an audience of about 750,000. Most of its programmes have much lower audience figures, and that's when its content is free to view.

A more realistic estimate of the numbers who would be prepared to pay for its content is probably nearer to 500,000, which wouldn't meet its current costs at your subscription rate.

Another problem with the subscription model you posit, is that popular programmes are likely to be distributed around the channels to maximise the number of channels that people have to subscribe to. If you only subscribe to BBC2 and BBC4, there will inevitably be some programmes that you want to see that will be on the other channels you haven't subscribed to. As an example of how this works, Sky show particular sports across all of its sports channels, so if you only want to see rugby, and have no interest in football, you still have to subscribe to all the sports channels to see all the rugby broadcasts; you can't just subscribe to Sky Sports 2.

[Gordon]

The problem with subscription is that it doesn't require citizens to fund the BBC.....

What if the subscription system is run by the BBC FOR the BBC? Just as the BBC is major part of Freeview, they could have a joint subscription management system.

This isn't what I had intended to post. I have had some trouble this PM with being continually logged off for no obvious reason even in mid type. Then when posting or editing it sometimes being told I was not authorised to post my own piece!!

The problem with subscription is that it doesn't require citizens to fund the BBC.....

That is the heart of this debate. We require "citizens" to fund BBC because we perceive it, and always have, as a "Public Service". It is the notion of that that is being challenged. The White Paper has concluded that that notion isn't yet broken - for the time being. Whittingdale, such a critic as Chair of the Select Committee, has now to fulfil the role of Minister which is quite a different thing. As I said above, the problem for any other form of funding the BBC is that a workable substitute had to be in place at the start of this new charter - despite all the noise no-one did anything about it in good time. Ergo anything but the Licence Fee is dead in the water - until next time or until some major game changer like revoking the spectrum happens and then a new scenario for the BBC opens up. Can we see a change in funding model during this new charter? Possibly. Who will be motivated to move it forward? Why would they? Is there enough public support for getting rid of the LF - any proponent would have to offer a more attractive method? There are loudish voices that do want to do that but I wonder what their demographic is?

[ferneyhoughgeliebte]

The funding would have to be ring-fenced or hypothecated in some way, with any periodic reviews conducted by, say, a joint committee of both Houses of Parliament (so not entirely free of external control but at least far better than the licence fee level being at the whim of the executive without any parliamentary audit). Finland's system has a ring-fenced charge I think. A hypothecated tax would of course not avoid the charge of being compulsory but would at least be progressive and the poorest would not pay anything.

But which of the "every other public services" are so hypothecated? Why should telly be regarded as so important that its funding needed ring-fencing, whilst hospitals, schools, and emergency services were subject to the whims of the Chancellor?

[french frank]

But which of the "every other public services" are so hypothecated?

Effectively, MPs' salaries are hypothecated (under a non-governmental system), since the level is set by an independent authority and we keep hearing that MPs 'can't refuse their increases'.

[aeolium]

But which of the "every other public services" are so hypothecated? Why should telly be regarded as so important that its funding needed ring-fencing, whilst hospitals, schools, and emergency services were subject to the whims of the Chancellor?

That's a fair question, and the only answer I have is that if you are serious about the independence of the BBC - i.e. removing its purse-strings from the executive - then that is the kind of solution you need. Otherwise all talk about the BBC's independence is just that - talk.

[french frank]

My answer was a Broadcasting Commission with the authority of IPSA. And I do think a state broadcaster is in a completely different situation from the NHS, schools &c. where there are local levels of accountability (even with the elected PCCs) - theoretically. At the moment.