Memorandum submitted by Talkback THAMES
TV
ABOUT TALKBACKTHAMES
talkbackTHAMES is one of the UK's largest television
independent production companies. It was formed when two of the
best-known brands in UK television Talkback and THAMES joined
together in February 2003.
With unparalleled production expertise, talkbackTHAMES's
recent programming ranges from The X Factor to Grand Designs;
The Bill to How Clean is Your House; Green Wing to They Think
It's All Over. It produces over a thousand hours of programming
a year across all broadcasters.
talkbackTHAMES has a raft of award winning programming
to its name. In the past twelve months alone awards have included
three Emmy Awards for Stephen Poliakoff's The Lost Prince, a British
Comedy Award and two National TV Awards for The X Factor, a Bafta
for Green Wing and a Grierson Award for the documentary Bye Bye
Happiness.
talkbackTHAMES is the UK Production arm of FremantleMedia.
Drawing on their licensing and distribution capabilities, talkbackTHAMES
is uniquely placed to get the most out of programming internationally
and by extending programme brands into new areas. FremantleMedia
is the global production and content arm of RTL Group, Europe's
largest Television and Radio Company which in turn is part of
the Bertelsmann Group.
INTRODUCTION
Digital technology and the development of new
media are transforming the broadcasting industry as we know it.
Specific recent developments, which already
have or will have an impact on the content industry, are:
— The development of Personal Video
Recording (PVR) technology which allows viewers to timeshift their
viewing.
— The increasing penetration of broadband,
and the increasing speed of broadband networks, which means that
downloading a 45 minute episode of a series takes no more than
five minutes.
— Linked to this, the imminent introduction
of broadband-enabled set-top boxes into the UK market.
— The development of smart video search
engines by Google and other technology companies.
— The introduction of the video ipod,
and the recent deals between some of the Hollywood studios and
Apple to distribute their content on ipod.
— Google's recent launch of an online
video store where users can buy and download television programmes.
— The BBC's Terms of Trade which offer
a 7-day catch-up window on all of its programmes, and the pressure
commercial broadcasters are putting on independent producers to
give them an even longer window.
— The recent launch of mobile television
offerings within the UK.
These technologies have empowered the consumer.
The viewer or listener has moved from an environment of limited
choice and control to one of customised, personalised, interactive
media where they can tailor what they want to watch, when they
want to watch it, and where a range of alternative platforms from
the internet to the video i-pod.
As content creators we welcome the commercial
and creative opportunities that the convergence of media technology
brings. We must harness this new technology to exploit new commercial
and creative opportunities and continue to bring the highest-quality
programming to consumers.
But with unprecedented opportunity, the convergence
of media technology also brings questions. The new world brings
huge challenges for media companies of every size with hundreds
of new content providers including consumers themselves, fragmentation
of audiences and new technologies. We have to learn to adapt and
change in a fast-paced environment where the old realities and
assumptions have shaped our market environment and financial models
are increasingly irrelevant.
Our relationship with broadcasters, distributors,
advertisers, platform operators and viewers must adapt to new
funding models and new economic drivers. We must decide how best
to protect and exploit our value as content creators and participate
fully in the creation of new revenue streams.
We do not know which business models will work
in this new world. We do know that the industry must be given
the freedom and flexibility to adapt and compete. We do know that
a legal framework, which protects the rights of the creator, is
essential to foster growth and encourage creativity within our
sector.
OUR RECOMMENDATIONS
The following evidence will comment specifically
on four areas, which fall under the broad terms of the inquiry:
1. The proposed amendments to the EU's Television
Without Frontiers Directive (TVWF) which proposes a wide minimum
standard of regulation for audiovisual on demand services.
2. Within the Directive the proposed changes
for more flexibility for financing audiovisual content by new
forms of advertising, specifically product placement.
3. The Terms of Trade for New Media Content.
4. The BBC Archive and changes to copyright
law.
1. THE EUROPEAN
COMMISSION'S
PROPOSAL FOR
A MODERNISATION
OF THE
TELEVISION WITHOUT
FRONTIERS DIRECTIVE
1.1 Non-traditional media platforms differ
from television platforms because they offer non-linear content,
such as on-demand films or news, which the viewer chooses to "pull"
from the network. Conceptually then, the level of choice by the
consumer in non-linear services mean that it requires less regulation
and certainly less harmonised regulation.
1.2 The European Commission's draft proposal
to the Television Without Frontiers Directive seeks to apply an
EU wide minimum standard of regulation on audiovisual on demand,
non-linear services.[66]66
PROTECTION OF
MINORS
1.3 The draft revision of the Television
Without Frontiers Directive tabled by the European Commission
seeks to extend some minimum coordination in the field of protection
of minors; and prohibition of incitement to hatred.
1.4 We share the Commission's concern over
these areas. The legal basis in the criminal law for the protection
of minors, however, already exists. Self-regulation and voluntary
measures are flexible and will allow new developments to be controlled
more quickly than with further legislation.[67]67
1.5 Recommendation 1:
TalkbackTHAMES suggest a voluntary seal of approval,
associated with an age rating, for the internet or mobile content
providers which will comply with a set of guidelines. This would
give consumers the guarantee that they can safely watch the content
that has received this seal, as well as create a comfortable environment
for the advertising industry to invest on these platforms.
EUROPEAN CONTENT
QUOTAS
1.6 Section 35 of the Directive 89/552/EEC
states: "Non-linear audiovisual media services have the potential
to partially replace linear services. Accordingly, they should
where practicable promote the production and distribution of European
works and thus actively contribute to the promotion of cultural
diversity.[68]68"
1.7 TVWF's aim to protect European content
providers against foreign competition by imposing quotas on content
is misguided and should not be applicable to new media platforms.
They are a form of unnecessary protectionism, and are increasingly
anachronistic in the world of unlimited choice in which we now
live.
1.8 In a market place vying for audience
share, advertising revenue and subscribers it is right that channels
are able to respond to the preferences of the viewers.[69]69
1.9 The Commission is right not to propose
European content thresholds on new media platforms, and not to
specify how non-linear services should provide access to European
works.
1.10 Recommendation 2:
In the digital world, we need to respond with
technology and creativity rather than regulation. We must trust
the public to control what they watch—having been first
made aware of the contents of the programme to control what they
watch. We do not know which business models will work. It is important
not to stifle the development of a sector with inflexible regulation
which will become quickly invalid and unenforceable.
2. PRODUCT PLACEMENT
2.1 Product placement is the inclusion of,
or reference to, a product of service within a programme in return
for payment or other valuable consideration. It is currently prohibited
under the TWF Directive but the draft revision proposes to liberalise
the rules governing television advertising.
2.2 The new directive lays down rules prohibiting
product placement that misleads the consumer, but permits it provided
it is clearly identified as such, and is subject to appropriate
rules and safeguards for the viewer's essential interests.[70]70
Under the new directive, product placement would therefore for
the first time be explicitly defined with a clear legal framework.[71]71
2.3 Research shows that PVR owners currently
watch around 40% of their TV in pre recorded form and fast forward
the advertisements 77% of the time they are watching. Once all
households have PVRs, this would suggest a loss of around one
third of all commercial impacts. This would have a potentially
serious negative effect on the value of TV airtime, and a more
fundamental threat to the sector.[72]72
2.4 talkbackTHAMES welcomes the proposed
liberalisation of product placement.
Product placement is an important new revenue
stream for content creators and will safeguard the continuation
of high quality content as advertising revenue fragments. For
the first time independent producers will be able to compete directly
for a share of marketing spend.
2.5 A recent Ofcom study found that product
placement which "was relevant to the programme and subtle'
received the highest approval score among respondents asked to
give their approval of future funding types.[73]73
2.6 Recommendation 3:
TalkbackTHAMES recommend that product placement
should:
(i) Be allowed—as long as it does not
infringe on the integrity of the programme content.
(ii) Not be disguised—A solution would
be to identify the use of products in the credits.
(iii) Where an independent producer has sourced
the product placement they should be entitled to keep the revenue
and invest it in content.
3. NEW MEDIA
RIGHTS: THE
TERMS OF
TRADE
3.1 The Communications Act of 2003 recognised
the imbalance in negotiating positions of broadcasters and independent
producers. Parliament, given the quasi-monopolistic position of
large broadcasters introduced legislation which secured the rights
of independent producers to retain international and ancillary
rights in markets such as overseas territories, merchandising
and DVDs separately from initial UK broadcasting rights.
3.2 The new codes and terms of trade established
however did not address the exploitation of content over new media
platforms. Ofcom's Review of the Television Production Sector
is currently considering this issue.
3.3 talkbackTHAMES welcome Ofcom's consultation.
To promote the distinction between public service (broadcaster)
and commercial (producer) exploitation, the BBC is entitled to
a seven day window in which UK license fee payers can access free
certain content on any platform for up to seven days from first
transmission of the programme.
3.4 Despite this broadcasters are exploiting
their market position to bundle new media rights into the primary
package and to hold on to these rights for an unreasonable length
of time. A clear example of this is our current dispute with the
BBC over the new media rights for "The Apprentice".
In keeping with the Terms of Trade the contractual agreement for
the first series allowed the BBC to retain new media rights for
seven days. In the second round of commissioning the BBC has demanded
an unlimited usage of online content (including biogs, interviews,
programme clips and specially shot footage) across all new media
platforms for a five year period.
3.5 Broadcasters may need to extend their
rights to other platforms to hold onto viewers but they should
not be allowed to hang onto these rights for so long that they
squeeze all the value out of them. By demanding holdback rights
for an unreasonable length of time broadcasters threaten the legitimate
right of the independent producer to exploit their intellectual
property in the commercial market. This seems a move backwards
from the intentions of the Communications Act of 2003.
3.6 It is essential that a regulatory framework
evolves in this area which will allow fair commercial negotiation
between broadcasters and independent producers over these new
media rights.
3.7 talkbackTHAMES has recommended to Ofcom
that the following model for a new code of practice could form
the basis for negotiatations between independent producers and
broadcasters over new media rights:
3.8 Table
PROPOSED DIVISION OF NEW MEDIA RIGHTS BETWEEN
BROADCASTER AND PRODUCER
|
| Rights | Broadcaster Window
| Holdback on Producer |
Profit Share |
|
Primary Online
Video on Demand
Mobile/Wireless Transmission
| 1-3 days from tx of relevant episode
| Holdback during License Period should be released on the same principle as Secondary distribution rights.
| 50-50 during LP
85-15 after LP
|
Clip Rights in Broadcast Material
|
Prior to tx (on a promotional basis only)
| Holdback until after 1st tx of relevant episode and perhaps limitation on amount of material eg 3 min clips per 30 mins of programming
| 50-50 during LP
85-15 after LP
|
PRTS
Play-along Interactive TV
| N/A
| None—Simultaneous with tx
| 50-50 with broadcaster tx
85-15 with secondary tx
|
Mobile Technology
Secondary Online
Non-Simultaneous Interactive TV
Clip Rights in Non-Broadcast Material
| N/A
| Holdback until after 1st tx of 1st episode
| 50-50 during LP
85-15 after LP
|
|
3.9 Recommendation 4:
TalkbackTHAMES recommends that a regulatory framework is
established which will allow fair terms of trade for new media
rights.
It is reasonable for broadcasters to retain some degree of
control over rights that are exploited simultaneously with the
programme, but these rights should be limited to those which genuinely
enhance and support the broadcast of the programme (interactive
services, catch-up viewing, telephone voting) and should be restricted
to between one and three days as appropriate.
4. THE BBC ARCHIVE
AND CHANGES
TO COPYRIGHT
LAW
Non-commercial use of content
4.1 We accept that new technologies are inspiring new
forms of creativity. Digital technology has passed the tools of
production and distribution into the hands of the consumer. Thousands
of consumers are actively participating in culture by remixing
their own songs, making their own films and TV programs for personal
non-commercial use.[74]74
4.2 This said, copyright, despite its name is not a right,
but an agreement on the debt owed to the creator by society. It
is right for the individual and by extension the corporation to
make money from the product of its creative and productive labour.
However, the admission of the principle of reward must be pragmatically
balanced with a recognition that creativity is and always has
been fuelled by access to existing knowledge, however embodied.
4.3 The impact of the unauthorised reproduction of creative
content on the music industry has been very well documented. This
is currently being significantly reduced by the introduction of
legal download platforms. As new media platforms develop it is
vital that our rights are extended into the digital domain.
4.4 It is essential that a clear collaboration framework
be put in place with groups representing music, actor and writing
talents to create a similar legal platform for the broadcasting
industry. Without such a framework and platform, there is a real
risk that users will choose an illegal option of accessing content
instead.
4.5 The use of content for personal use is entirely different
from the BBC's Creative Archive. Trialled between September and
December 2005 this offered 5,000 access to around 500 hours of
TV and radio programmes. The content was available to rip, mix,
and share under terms of a Creative Archive Licence.
4.6 The Creative Archive amounts to a widespread free
on-demand usage, which, if allowed to proceed, will significantly
undercut the value of secondary rights in programmes. The BBC
cannot have a permanent free on demand service for programmes
where other people have a genuine commercial interest in exploiting
these rights.
4.7 The BBC has expressed its wish to "look at new
ways to clear the copyright on TV and Radio output so that [...
] the British public can get creative with it.[75]75
TalkbackTHAMES finds the move by the BBC to try to clear copyright
on television and radio output as extremely disturbing. The BBC
should not be exempt from copyright law.
4.8 Recommendation 5:
TalkbackTHAMES is strongly opposed to the BBC Creative Archive.
Any pressure to change the current balance of copyright law to
the detriment of the legitimate rights of the creator should be
strongly resisted. To do otherwise would seemingly benefit the
consumer in the short term, but in the long term it would fundamentally
kill the creative process to the detriment of society.
SUMMARY OF
RECOMMENDATIONS:
Recommendations 1 and 2:
The EC's Proposals for a Modernisation of the Television
Without Frontiers Directive:
Protection of Minors
TalkbackTHAMES suggest a voluntary seal of approval, associated
with an age rating, for the internet or mobile content providers
which will comply with a set of guidelines. This would give consumers
the guarantee that they can safely watch the content that has
received this seal, as well as create a comfortable environment
for the advertising industry to invest on these platforms.
European Quotas
In the digital world, we need to respond with technology
and creativity rather than regulation. We must trust the public
to control what they watch—having been first made aware
of the contents of the programme to control what they watch. We
do not know which business models will work and it is important
not to stifle the development of a sector with inflexible regulation
which will become quickly invalid and unenforceable.
Recommendation 3:
Product Placement
TalkbackTHAMES recommend that product placement should:
(i) Be allowed—as long as it does not infringe on
the integrity of the programme content.
(ii) Not be disguised—A solution would be to identify
the use of products in the credits.
(iii) Where an independent producer has sourced the product
placement they should be entitled to keep the revenue and invest
it in content.
Recommendation 4:
Terms of Trade
TalkbackTHAMES recommends that a regulatory framework is
established which will allow fair terms of trade for new media
rights.
It is reasonable for broadcasters to retain some degree of
control over rights that are exploited simultaneously with the
programme, but these rights should be limited to those which genuinely
enhance and support the broadcast of the programme (interactive
services, catch-up viewing, telephone voting) and should be restricted
to between one and three days as appropriate.
Recommendation 5:
BBC Creative Archive
TalkbackTHAMES is strongly opposed to the BBC Creative Archive.
Any pressure to change the current balance of copyright law to
the detriment of the legitimate rights of the creator should be
strongly resisted. To do otherwise would seemingly benefit the
consumer in the short term, but in the long term it would fundamentally
kill the creative process to the detriment of society.
8 February 2006
66
66 Proposal of the European Parliament and of the Council Amending
Council Directive 89/552/EEC Published 13 December 2005. Back
67
67 UK Government Response to the Commission Consultation on TVWF
Directive 89/552/EEC as amended by 97/36/EC para 33. Back
68
68 EU Directive of the European Parliament and of the Council
Amending Council Directive 89/552/EEC pg 17. Back
69
69 UK Government response to the Commission Consultation on TVWF
Directive 89/552/EEC as amended by 97/36/EC para 21. Back
70
70 EU Press Release: The Commission Proposal for Modernising TVWF.
FAQ's. Ref: MEMO/05/475 13 December 2005. Back
71
71 EU Press release: TV Without Frontiers Reference: IP/05/1573
Date 13/12/2005. Back
72
72 Robin Foster, Partner, Strategy and Market Developments, Ofcom
"Beyond Advertising-Keynote speech to new media markets conference,
19 May 2005". Back
73
73 Ofcom: The Future of Television Funding, September 2005. Back
74
74 "Amateur culture" set to explode. BBC website. 18
July 2005. Back
75
75 <au0,2.5>http://creativearchivebbc.co.uk/archives/the_bbcs_plans/ Back
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