Could the BBC be forced to share the licence fee?

The funding model which underpins thousands of journalists’ jobs has been thrown open to debate by culture secretary James Purnell’s suggestion that licence-fee funding should be made available to other public service broadcasters.

Addressing last week’s Oxford Media Convention, Purnell did not question the need for public service broadcasting, but he asked how it might be retained in a digitally converged, competitive market.

In this, he did not rule out the possibility of the BBC being forced to share the licence fee with other public service broadcasters such as Channel 4 and ITV.

The BBC is concerned its already tight licence-fee settlement will be further reduced. BBC Trust chair Sir Michael Lyons argued that the market already provides some plurality in public service broadcasting without the need for further intervention, using Sky News and Sky Arts as examples.

Top slicing

He said that top slicing the licence fee would undermine BBC’s accountability to its audience and threaten its ability to fulfil its public purposes.

But Purnell’s speech appeared to sweep aside any sense of entitlement the BBC might have felt, as he said: ‘Do we think it’s sustainable for every penny of the licence fee to go to a single organisation in an industry which now has very many providers, not just a handful?”

His announcement came as BBC journalists weigh up strike action over 2,000 proposed job cuts prompted, in part, by the latest licence-fee settlement. Within the current group of public service broadcasters, Channel 4 stands to gain the most from new funding as it already faces a funding crisis caused by digital switch over and increased competition.

Chief executive Andy Duncan is set to unveil his creative vision for the broadcaster in a digital age in March.

A spokesman for the channel said: ‘Channel 4 is not at this point asking for a hand out from the licence fee. Outside the BBC, Channel 4 is the most important public service contributor. We want to carry on playing that role. In order to ensure we continue to make an impact in the emerging media landscape we are going to need some new form of public support to replace the gifted analogue frequencies we have had since we were launched in 1982, but which will effectively disappear in 2012.”

ITV would surely welcome funds to boost its regional news budget which it proposes to slash from £90m to £40m, reducing the number of regional news programmes from 17 to nine.

It will take a keen interest in Channel 4’s prospects, too; ITV chairman Michael Grade told a Royal Television Society conference last year that the rival broadcaster would be better going private than continue on public subsidy.

The National Union of Journalists wants to see the BBC retaining its licence fee and has set out a number of proposals, including a levy on commercial broadcasters, to raise funds for public service content elsewhere.

‘If a solution isn’t found that provides an alternative to BBC news programming, news will wither on the vine – first at the [commercial] competition and subsequently at the BBC,’said NUJ broadcasting organiser, Paul McLaughlin.

Technology journalist Bill Thompson, who set up The Guardian’s website, has suggested a more dramatic solution to the PSB conundrum is needed, claiming that the television licence will not survive the next charter renewal in 2016.

He said: ‘Charging a TV licence fee to own receiving apparatus will be more of an absurdity than it is these days. I don’t see how the Government in eight years’ time will be able to support it.’

Serious issue

At the Oxford Media Convention, Thompson suggested public investment in broadband delivery was needed, saying it was necessary to get universal access to the content before debating what that content need be.

‘The media industry is not taking this issue seriously enough,’he said. ‘It’s almost as if the newspaper industry said, ‘we don’t care what happens to the railway systems or the road networks, I’m sure our newspapers will get distributed, maybe it will be magic’.

‘They are ignoring the fact that they want to provide all of these services to many people, but unless they get engaged in the question of how to provide high-speed access, whatever cool stuff they come up with isn’t go to reach the market.’

Anthony Lilley, chief executive of digital media producer Magic Lantern, and who sits on Ofcom’s content board, said the interested players needed to go back to why public service interventions were necessary.

He added: ‘There’s nothing special about television that makes it any more capable of doing public service delivery than other media necessarily.’

This opens the door, not only for commercial broadcasters such as Sky, but any media company that could show it produces public service content. ‘What’s most fascinating about the broadcasting industry is that it thinks it has a monopoly on being a public service industry,’said Lilley.

‘I’m not sure when libraries or when the education system stopped being public service and they’re both involved in ideas and media and how they benefit our society.

‘The fact that it has been delivered in part through broadcasters does not mean broadcasters have an monopoly on the idea.”

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