Ofcom: BBC cannot be sole public service provider

Broadcasting regulator Ofcom said today that between £145 million and £235 million of ‘replacement public funding’is needed by 2012 to maintain public service broadcasting outside the BBC in the post digital TV switch-over world.

The proposals follow audience research which found that nine out 10 Britons do not want the BBC to become the only provider of public service broadcasting. The research claims that three quarters of viewers would pay up to £3.50 a month for PSB services on ITV, Channel 4 and Five.

This means that Ofcom has now ditched as an option the possibility that the BBC would be become the only source of subsidised public service broadcasting post 2012.

Ofcom says that current affairs, nations and regions programming, challenging drama, scripted comedy, and drama and factual programming for children are becoming increasingly commercially unattractive. This has been made worse, Ofcom says, by the deteriorating advertising market this year.

Ofcom said today that Channel 4 will need extra funding of £60 to £100 million by 2012 if it is to maintain investment in public service content.

To keep public service TV at current levels in 2012, Ofcom estimates that public funding of £330 to £420 million will be needed – of which £185 million will come from existing subsidies.

Ofcom said that future funding for PSB outside the BBC could come from: the licence fee by maiking use of the £130 million per annum surplus currently being used to pay for digital switch-over; the BBC’s commercial wing BBC Worldwide; giving PSB providers privileged access to the airwaves; some form of communications sector levy.

Ofcom has proposed three possible models for how public service broadcasting will be provided post 2012:

  • Evolution model: The BBC, ITV1, Channel 4 and Five continue to have PSB obligations. ITV1 to focus on content made in the UK and international news. Additional funding needed for nations and regions news. Channel 4 to have extended remit to provide public service content across platforms, with additional funding. Five to focus on broadcasting programmes made in the UK, in particular children’s programming and news.
  • BBC/Channel 4 model: BBC and Channel 4 receive public funding and regulatory assets. Channel 3 licensees and Five lose their PSB status and benefits. Funding for local news and children’s content opened to a wide range of potential providers.
  • Competitive funding model: Funding to provide public service content to complement the BBC would be opened up to competition. A wide range of providers (in addition to ITV1, Channel 4 and five) such as online providers, multichannel broadcasters, or other types of media organisations, could all bid.

Ofcom’s consultation on the future of PSB closes on 4 December 2008. Ofcom expects to publish a final statement in early 2009.

To read the full consultation document click here: Ofcom’s consulation on public service broadcasting

Government and Parliament will make a final decision on the future funding of PSBs and, if appropriate, legislation by 2011.

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