Memorandum submitted by Voice of the Listener
& Viewer (VLV)
Voice of the Listener & Viewer (VLV) welcomes
the inquiry by the Select Committee for Culture, Media & Sport
(CMS) and is glad to respond. In the comments below VLV has responded
to the specific questions set out in the inquiry's terms of reference.
VLV has also identified other areas for further examination. These
include the future remit of Channel 4 and the future of radio,
see paragraphs 7 and 8 below.
1. THE PROSPECTS
FOR MAINTAINING
PLURALITY IN
PUBLIC SERVICE
BROADCASTING IN
THE DIGITAL
AGE
1.1 VLV considers that plurality in public
service broadcasting will become even more important in future
as a counter-balance to the increasing concentration and globalisation
of the ownership of commercial media companies. Plurality will
also be important as new technology brings opportunities to use,
adapt and deliver content across different media. Despite the
growth of web-based, satellite, cable and broadband services,
television and the brand names of the five terrestrial public
service broadcasters will, in our opinion, remain an irreplaceably
important element in the media landscape for the foreseeable future.
1.2 In recent years we have seen how a programme
broadcast on a national radio or television channel can still
engage the public interest and inflame opinion. We have also seen
how easily and quickly the media landscape can change following
BSkyB's purchase of a significant holding of shares in ITV plc.
Since BSkyB is both the monopoly supplier of satellite services
in the UK and the dominant owner of UK newspapers, with a growing
interest in radio and new media, there is a real risk that its
purchase of 17.9% of the shares in ITV plc could threaten the
present plurality.
1.3 In programme policy terms, the purchase
could well affect ITV's long-standing tradition of providing a
wide range of diverse, high quality, original programming, including
UK produced drama, regional programming and children's programmes.
1.4 ITV is now also the owner of Independent
Television News (ITN), the provider of news for the ITV network
and Channel Four. ITN is the only national competitor for BBC
News. Although Sky currently provides an excellent news service
for the UK, since Sky is not governed by a public service remit,
it bears no obligation to maintain its news service and is at
liberty to drop it, should it decide to do so, for whatever reason.
In our view, it is essential in the interests of British democracy
for the BBC to have a powerful terrestrial competitor for its
news services. See paragraph 5.1 below.
1.5 It is obvious that the economics and
conditions of the public service broadcasters will change in future,
especially after analogue switch-off. The UK media market will
become even more competitive, with a variety of new screen-based
information, news and entertainment services. Yet we believe that
there will still be a demand for trusted television services and
content, and that these will retain the potential to colour public
opinion and influence our culture, society and democracy. New
regulation and public intervention or funding may be required
to sustain them but if the political will is there we believe
that ways will be found to meet the situation.
1.6 Viewers and listeners want high quality
programmes and content, irrespective of delivery platform or broadcaster.
They do so because the UK enjoys the benefit of an 80 year tradition
in which the ethos of public service broadcasting has been dominant.
Examples from abroad, including Australia and Canada, show how
quickly that key quality and range of programming can be lost
when that public service ethos is lost to a more market-led approach.
We must not allow this to happen in the UK as we move into a digital,
multi-channel future. Thus the BBC, Channel 4 and S4C must be
sustained as public service broadcasters and incentives found
to encourage other UK broadcasters to provide competition across
the board and so prevent monopoly provision in any genre of programming.
2. THE PRACTICALITY
OF CONTINUING
TO IMPOSE
PUBLIC SERVICE
OBLIGATIONS ON
COMMERCIAL BROADCASTERS
2.1 The commercially funded public service
broadcasters—ITV, Channel 4, S4C and Five—have recently
experienced volatility in their finances. Advertising has been
in recession and each broadcaster's income has suffered. However,
all are now reviewing their strategies prior to digital switch-over.
Each has created new digital channels which are distributed terrestrially,
by satellite, cable and broadband. The new ITV and Channel 4 channels
rely heavily on repeats of archive material. Five, with its very
small archive is relying on bought in acquisitions, mostly from
the USA. It is early days yet to gauge the success of Five's new
channels but the others appear to be quite successful. The strong
brands and quality content resonate with viewers and it is notable
that the most popular channels broadcast by Sky are normally those
of the terrestrial public service broadcasters or those which
carry a large percentage of content originally created by them,
even though that material is in many cases more than 30 years
old.
2.2 As members of Ofcom have frequently
observed in meetings with us, it is becoming increasingly difficult
to "oblige" commercial broadcasters to provide programmes
and services which are not in their economic interest. As competition
increases in future, life will become more difficult for broadcasters
funded mainly by advertising and they may be tempted to reduce
the range of their programming in order to minimise the risks.
VLV therefore believes that if audiences are to continue to have
access to the full range of free-to-air content laid out in the
2003 Communications Act, the introduction of incentives may prove
a more effective method than the imposition of obligations which
cannot be met.
2.3 In the run-up to switch-over, we consider
that the existing PSB obligations are proportionate, and do not
impinge too heavily even in the increasingly competitive market.
The audience needs and appreciates the choice of programming thus
provided.
3. THE VIABILITY
OF EXISTING
FUNDING MODELS
FOR ITV, CHANNEL
4 AND FIVE
3.1 We are not qualified to judge the viability
of existing funding models for ITV, Channel 4, S4C or Five. In
S4C's case, however, we note that following the report by Professor
Roger Laughton in 2004, and the recent overhaul of its programme
strategy by its new Chief Executive, S4C now seems to be confident
about its future.
3.2 ITV is a strong brand with an extremely
valuable archive of high quality content. ITV is also a highly
profitable company which attracts very large audiences when it
provides high quality programmes and innovative formats. As ITV's
dedicated digital channels seem to be proving successful we believe
the channel is starting to overcome some of its recent problems,
whether those were due to the advertising recession or its own
mismanagement.
3.3 Five is a relative newcomer which has
widened choice for viewers. It now seems to be finding its feet,
despite losing share in the past year. Five has been disadvantaged
by its late launch, lower reach and poor reception in some areas
but as it has the weakest remit of the public service broadcasters
we hope that once the UK switches to digital and that handicap
ends, the channel will find a way to remain viable.
3.4 VLV recognises that the existing funding
model (based mainly on advertising revenue) of ITV, Channel 4
and Five may not be sustainable and that new sources of funding
may need to be found. However, we believe it essential, in the
public interest, that a full and open debate about new funding
methods is conducted in public in the immediate future in order
to ensure that the quality and editorial integrity of programming
is maintained.
3.5. It must be realised by all involved
that commercially funded broadcasting does not operate in a "free"
market. The economics of production and distribution are different
to other goods and the commodities being traded are not the programmes,
but the viewers and listeners who enjoy them. Commercial broadcasting
is about delivering audiences to advertisers. Public service broadcasting
is about delivering programmes and services to audiences. Moreover,
since broadcasting is still the main source of news, information
and entertainment for most people in the UK, important aspects
of citizenship, culture and democracy are involved. For these
reasons we consider it imperative that public policy interventions
continue to be made (on existing and new platforms) in order to
safeguard and sustain these services for future generations.
4. THE CASE
FOR PUBLIC
FUNDING OF
BROADCASTERS IN
ADDITION TO
THE BBC
4.1 We believe it is most important for
the BBC to have competition from other public service providers
in all areas of programming. There is already strong competition
from unregulated cable and satellite providers but these are not
competing on a level playing field. We do not consider that any
of these non-UK based commercially funded companies should receive
public funding because there is every risk that they will pick
and choose the most profitable genres, only to drop the programming
when they no longer consider it attractive. We would not support
any move to "top-slice" the BBC licence fee or to add
a levy on top of it in order to provide funding for commercial
broadcasters to make "public service" programmes.
4.2 We do, however, consider that if in
future the terrestrial PSBs: ITV, Channel 4, Five and S4C find
it economically unviable to continue producing PSB content, there
may be a case for continuing to provide some public subsidy in
order to maintain a plurality of ownership and the wider choice
of original content the PSBs provide. In the past the terrestrial
channels have benefited from a lack of competition. They have
also enjoyed the free use of spectrum and we consider that this
subsidy should continue. We also consider that it might be in
the interest, not just of viewers because of the valuable extra
choice of content they provide, but also of the nation, for these
services to continue.
4.3 ITV and Channel 4, especially, play
a valuable economic role, both in providing jobs for workers in
the UK creative industries and for their contribution to the British
economy through their export earnings. The UK is second only to
the USA in the economic value of its media exports. The intangible
benefit that these exports create by exporting British culture
and promoting British interests, services and products to the
world, should also be taken into consideration. Under these circumstances,
we believe there may also be a case for introducing tax breaks
or other fiscal measures to help maintain the viability of UK
media companies.
4.4 VLV believes that the maintenance of
Channel 4 and S4C as PSBs is essential to provide plurality, and
competition for the BBC. If it becomes necessary to provide some
sort of public funding to sustain the programming defined in the
2003 Communications Act, VLV would be supportive, so long as the
process was transparent and value for money assured. VLV also
believes (see 4.2 above) that public policy intervention may be
required in the future in order to maintain the PSB programming
defined in the 2003 Communications Act.
5. THE FUTURE
FOR KEY
AREAS OF
PUBLIC SERVICE
MEDIA CONTENT
SUCH AS
NEWS PROVISION
AND CHILDREN'S
PROGRAMMING
News
5.1 We consider it essential to the future
of British democracy for a plurality of UK news provision to be
available to UK viewers. While BSkyB provides the excellent and
much-valued Sky New service, Sky has no obligation to maintain
that service or to provide a range of news items which covers
national and international issues, politics, commerce and industry.
Sky News needs only to be impartial in what it presents.
5.2 There is a danger that unless there
is a strong national competitor for the BBC, the opportunities
for political pressure on the BBC could become intolerable, both
in the way in which its news is presented and in the way its news
agenda is set. This applies as much to stories which the newscasters
decide to follow as to those they do not, for instance, during
an election campaign when staged photo-opportunities are used
to obtain media coverage.
5.3 As a group representing the citizen
interest in broadcasting, we believe it is vitally important for
the news agenda to be set by independent newscasters, not by politicians
or other powerful groups.
5.4 We believe it is important for the nations
and regions of the UK to have plurality in their news services.
At present only ITV and the BBC provide news for the nations and
regions; Sky provides only international and UK news. ITV, however,
may not continue to provide regional news after digital switch
over.
5.5 The BBC has an extremely tight remit
with regard to news, we consider this should be carried across
the PSBs and that, if necessary, ways should be found to help
enable them to fulfil the remit. If it is found that news operations
cannot be made financially viable in future, we believe that cross-subsidy
and other methods of allocating independent public subsidy should
be found to enable them to fulfil it. (see 4 above.)
6. CHILDREN'S
PROGRAMMES
6.1 VLV has been concerned for more than
a decade about growing threats to the quality, range, diversity
and origination of programmes for children available on commercially
funded terrestrial channels in the UK. We will not repeat all
the arguments and facts supplied by Save Kids' TV, of which VLV
is a member, but we agree wholeheartedly with the case it has
made to you.
6.2 ITV has an excellent record of providing
high quality programmes which could compete with the BBC. Five
also has an excellent record of providing original programmes
for pre-school children. Both are now threatened by competition
from the unregulated satellite and cable channels whilst at the
same time facing a loss of advertising income due to the recent
ban on the advertising of high fat, salt and sugar products.
6.3 The UK is the most competitive market
for young viewers in the world—23 dedicated channels target
British children—but most are the offshoots of foreign owned
corporations which broadcast mainly American content, much of
it animation. These channels provide entertainment which many
children enjoy but little content reflecting their own rich, cultural
heritage of language, literature, values and environment. Since
homes with children have a higher penetration of multi-channel
television than those without, many of these young viewers are
regularly exposed to the consumerist values of the more commercially-focused
foreign channels and growing up with a "Disneyfied"
view of the world, rather than their own history and culture.
6.4 The BBC is doing an excellent job both
on its terrestrial channels and with its two daytime dedicated
channels CBBC and CBeebies. But the BBC needs competition to keep
it on its toes and to provide an alternative view and source of
high quality content. Children are the most important viewers—they
are the future of our nation. They need, and have a right to enjoy,
the same wide range of programmes as adults: high quality programmes
which are made for them in their own cultural idiom, which reflect
their own localities, culture and values, and which put their
interests above those of overseas advertisers and producers. We
consider that in return for other advantages which the PSBs will
continue to enjoy, for instance, the "must carry" rules,
plus prominence and favoured positioning on the EPG, ITV, especially,
should be encouraged to continue providing a range of original
indigenous programming which meets the needs and interests of
young viewers across the UK. ITV should also be able to cross-subsidise
if necessary a range of original, indigenous programming which
meets the needs and interests of young viewers across the UK.
There may also be a case for assistance to be provided by the
proposed public service provider, should the PSP become a reality.
7. PROGRAMMES
FOR THE
NATIONS AND
REGIONS
7.1 The nations of the UK already enjoy,
and should continue to enjoy, distinctive high quality services
which meet their particular needs and interests, including news.
(see 5.2 above)
7.2 Although the ITV regions were based
on the functionality of the analogue transmitter network rather
than areas of cultural interest, we believe there is a case and
desire for programmes which showcase regional identity and talent.
Society and communities need prrogrammes which not only reflect
the culture of the locality but also when broadcast nationally,
help the nation to experience and understand its various parts.
7.3 Research published by Ofcom in 2005
appeared to show a relatively low appreciation of regional programmes
but we believe some of the viewing figures may have been affected
by the lower quality of the programmes caused by lower budgets,
and to inconvenient scheduling. The provision of programmes which
reflect and help to create understanding between different groups
in society is a fundamental principle of public service broadcasting.
It needs to be encouraged even though we appreciate that the smaller
audiences involved will affect the economics of such programming.
8. THE VALUE
OF THE
PUBLIC SERVICE
PROVIDER CONCEPT
AS ADVANCED
BY OFCOM
8.1 VLV is in principle open to suggestions
for the creation of a new Public Service Publisher/Provider (as
outlined in the Ofcom review on Public Service Broadcasting and
set out for consultation on 25 January 2007). Such an organisation
could—if properly regulated—add capacity for innovative
public service programming, and provide competition for the BBC.
8.2 The success or failure of the PSP will,
in our view, be determined by the nature of its remit, funding
and organisation. In particular, the following questions are central
to the debate:
— Where will the PSP be funded from?
Can it be guaranteed, for example, that the BBC's licence fee
revenue will be protected from so-called "top-slicing"
in order to support the PSP? Or from the imposition of a levy
which would muddy the lines of accountability and cause resentment
among licence-fee payers.
— Does the government, or Ofcom have
a preference with regards to the PSP's remit? If so, what is it?
What research will be carried out to inform the remit?
— How will the PSP be administered?
Who will appoint its members? What criteria will it use for allocating
funds?
— What will the relationship be between
the PSP and existing broadcasters with public service obligations,
such as ITV, Channel 4, S4C and Five?
— Will the PSP be required to source
programming from independent producers? If so, to what extent?
— To whom, and by what means, will
the PSP be accountable? In particular, by what benchmarks will
its public service provision be assessed?
9. THE CASE
FOR PUBLIC
SERVICE MATERIAL
ON NEW
MEDIA
9.1 VLV believes it is imperative that the
UK should take the lead in the provision of public service broadcasting
across new media, taking full advantage of the opportunities these
technologies offer for targeted local and minority programming,
interactivity, and access to archival material.
9.2 VLV wishes to emphasise its support
for the role the BBC has played in this process to date. The BBC
has innovated in terms of the quality and depth of its web coverage—building
one of the most popular and respected web sites in Europe—and
on-demand radio, and looks set to do so in the future with televisual
and archival services.
9.3 In doing so, the BBC not only broadens
and strengthens its own public service offering, but by acting
as a trusted guide drives demand in the sector- establishing potential
markets for commercial broadcasters, and setting benchmarks for
quality and delivery of services.
9.4 On this basis, it is the view of VLV
that the BBC should be supported in developing its online services
as necessary. In addition, we believe that alternative funding
mechanisms (perhaps including the proposed PSP, or other financial
incentives) should be used to encourage public service provision
from other organisations working in new media.
10. THE FUTURE
REMIT OF
CHANNEL 4
10.1 The committee has asked for views on
the funding of Channel 4 but not about the future remit of the
Channel itself. VLV considers that the present remit of Channel
4, which includes serving audiences which are not well served
by other broadcasters and requires it to innovate and take risks
in its programme making, serves the audience well. In future,
in an even more competitive globalised market, we believe this
remit will prove even more valuable as some channels well find
it difficult both to serve minority audiences and to take risks
in their programme commissioning.
10.2 Despite occasional controversy, Channel
4 has proved a valuable and irreplaceable addition to the UK broadcasting
ecology. Its future should be assured in the interests of British
culture and democracy. VLV considers that there may be a case
for extending Channel 4's remit in future to include gaps which
may arise in PSB output before and after digital switch-over.
Possible genres, for example, might include children's programmes
and regional programming.
11. RADIO
11.1 We note that the Committee has not
included Radio in its terms of reference. We would therefore like
to draw its attention to the valuable role that radio plays in
the ecology of UK media. As with television, radio not only brings
pleasure to millions of people daily, but (BBC Radio especially)
makes a unique contribution to the PSB content of new drama and
music and in fostering original comedy. Radio also plays an important
role in exporting British culture, ideas and music to the rest
of the world. As with all other media, radio has not been replaced
by television or other new media services but is now enjoying
a renaissance because of its ease of portability and transmission
across new delivery platforms.
Voice of the Listener & Viewer (VLV) is an
independent, non-profit-making association, free from political,
commercial and sectarian affiliations, working for quality and
diversity in British broadcasting. VLV represents the interests
of listeners and viewers as citizens and consumers across the
full range of broadcasting issues. VLV is concerned with the structures,
regulation, funding and institutions that underpin the British
broadcasting system. VLV does not handle complaints.
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