Examination of Witnesses (Questions 140-159)
PACT
27 FEBRUARY 2007
Q140 Chairman: It is not the case
that it is going to disappear. We have two dedicated channels,
CBBC and CBeebies, plus quite a lot of content on the main terrestrial
BBC network. Your case is essentially that the BBC, however good
it is, is not enough?
Mr McVay: Yes. The BBC itself
would be the first to say that they do not want to be placed in
a monopolistic position, because they do not believe that is healthy;
they believe that plurality is important, as we believe it is.
Clearly, if the BBC is the only place for children's television
to exist then a healthy independent sector is not going to exist
because an independent sector, as it is constituted presently
in the UK, has been based on providing UK children's programming
across all the broadcasters. If it is solely on the basis of the
BBC, we will not have the healthy sector that we have managed
to build up over the last decade. Going back into the 1970s and
1980s, when independent production first started to become a reality,
we have had children's programmes here which have been successful
on both ITV and BBC. One of the great things about UK children's
programmes was the period in the 1970s and 1980s when the competition
between the BBC and ITV was so incredibly strong and both broadcasters
were trying to out-punch each other to provide incredibly strong
programmes, the sorts of programmes that many people grew up with
and the sorts of programmes that they watch with their children.
If the BBC is the sole provider we will not have the same varied,
diverse and healthy market for children's programmes, and, as
good as the BBC is, and they are very, very good, they cannot
possibly supply all of the types of programming which presently
children can enjoy.
Q141 Paul Farrelly: John, I am sure
you will not mind me revealing your doing your job with "behind
the scenes" lobbying.
Mr McVay: It is my job.
Q142 Paul Farrelly: We met last when
we were discussing the ITV request to reduce its children's broadcasts,
and, thankfully, very soon after that, Ofcom denied the request.
Mr McVay: That was the Committee,
I think.
Q143 Paul Farrelly: Yes; otherwise
ITV's broadcast of children's programming would have paled into
even more insignificance compared with the explosion of quiz television
that we are seeing at the moment, about which we have been very
critical. Where do you see the roots of the crisis, as you call
it, in original, UK-commissioned children's television in this
country; what is driving it?
Mr McVay: It is very hard for
any commercial broadcasters to make a return on the money they
have to spend on children's programming, so for many years ITV,
and Nigel Pickard, who used to be Head of Network, would defend
this on children's, it loses the money, so of course, what they
will do, because of their commercial focus, is to say "How
can we get rid of the genre that is losing us money and replace
it with a genre that makes us money?" That is the natural,
commercial instinct, to do that. The question is, as part of a
PSB offering, should they spread the risk a bit more and still
invest in children's programming, in the full knowledge that it
is not going to make them a return, because actually that is our
core PSB duty that is placed on them. It is no surprise that they
will seek to exit children's programming and it is no surprise
that the restrictions on food advertising will be used as a smokescreen
in order to justify that as well; that is the commercial reality.
I can understand it, from a commercial point of view; the question
is, from a public service point of view, is that the right thing
to do: we do not think it is. We have campaigned, and we are still
lobbying Ofcom just now because Ofcom have yet to take a view
about ITV's licence going forward and we do not know what the
situation is with that. It is not surprising that the finances
are driving a commercial broadcaster to exit genres, or to move
into genres which give them a return, that is their commercial
instinct; it is not a quality issue.
Q144 Paul Farrelly: It is the demise
of the duopoly and the more channels the better?
Mr McVay: Yes. I think, on ITV,
the other thing I have got some sympathy with is that there is
now more children's programming available to children than ever
before. The question is, is the mix of that what we want; most
of it is acquired, most of it is merchandise-based, and because
it is acquired it bypasses the regulation, so a lot of channels
can provide a lot of acquired programming, hundreds and hundreds
of hours, at a very low cost, compared with ITV's position, which
is where they have to invest in original programmes. That is why
we think, with a fund, if we did move to some sort of centralised
fund, which could spread across all the platforms, you would get
more high-quality British children's programming everywhere, rather
than in just one place.
Mr Watts: Since the beginning
of this year, I think you would probably know, ITV has avoided,
so far, broadcasting its eight hours of required children's programmes
a week and has been broadcasting only two hours a week, which
it is broadcasting on Saturday and Sunday mornings. During the
weekday, on ITV1, where traditionally children's ITV has been
residing for the past 50-odd years, they have been running repeats
of Inspector Morse and Midsomer Murders and it will
come as no surprise to you that, in terms of commercial ad revenue,
that is generating more ad revenue for them than the children's
programmes which traditionally were in those slots. Obviously,
when this argument is played out, presumably ITV will be saying,
understandably, that they cannot support children's programmes
because they can replace it with other programming which is less
expensive and generates more ad revenue.
Q145 Paul Farrelly: I cannot possibly
follow all the kids' programmes that my little ones are watching,
so what you have said is that ITV at the moment are avoiding their
requirement?
Mr Watts: Not technically.
Mr McVay: They are not required
to say to Ofcom which slots in the day they will transmit, it
is over the year, so they can play catch-up in the year.
Q146 Paul Farrelly: They can average
it out?
Mr McVay: They can do that, yes.
Q147 Paul Farrelly: That is a technical
loophole.
Mr McVay: That is allowed under
the Communications Act.
Q148 Paul Farrelly: Is it a loophole
which should be closed, do you think?
Mr McVay: I think you close that
loophole if you go down the road of saying that you must spend
X amount per annum on original children's programming; then you
should say, "Well, if we're going to do that, where are we
going to see it?" I think those two things go together. If
you are not going to do that then it is going to be pretty hard
to say where they should transmit it.
Q149 Paul Farrelly: We will see very
little now but come the Easter holidays there will be more?
Mr McVay: You might find an awful
lot, yes. In the school breaks, you might find that large parts
of the schedule have children's programming.
Q150 Chairman: ITV are under huge
financial pressure, which is one of the purposes of this entire
inquiry. Given the Government's intervention in removing a considerable
source of their advertising revenue for children's programming,
so forcing them to continue to broadcast a set number of hours,
when actually, economically, it is not going to be profitable
for them to do so, it is probably not the right route. Therefore,
would you prefer your solution, of some kind of financial help?
Mr McVay: Yes; the two routes.
You do something which is a legislative, regulatory intervention,
requiring investment in programming and where you can see it,
which I agree has got many issues for commercially-funded broadcasters;
or, if you do agree that we need to have children's programming,
what is another way to do it. That is why we have put both positions,
because they are both options, and certainly I would anticipate
the Communications Act will come up for review some time in the
next two years, as the tensions within it start to overheat. What
we are trying to do is position a debate and an argument for Parliament,
and indeed for society. We will be releasing our research today
to the press, because we think one of the voices that was not
heard clearly on the issue of children and children's programming
was the voice of the parent. Another interesting statistic from
our survey, and I know this because I have got three boys, one
of the first things I do with DVDs is go out and buy the DVDs
I loved as a child to show them to my kids. I may be the last
generation which is going to be able to do that, because if we
do not have British children's programming my kids will not have
British children's programmes to show to their kids; and 77% of
parents felt that was a really important part of their family,
sharing their fond memories of their programmes with their children.
Indeed, when the BBC relaunched Dr Who I was more excited
than my kids, and it was because I was so excited that they got
so excited. I think there are some important things here about
our families and our children, and if we are not careful we will
lose them.
Q151 Paul Farrelly: Let us not forget
The Clangers, Chairman.
Mr Watts: And the clappers on
The Clangers.
Q152 Chairman: Having spent Sunday
sitting through Charlotte's Web, actually I can see some
advantages.
Mr McVay: Hopefully, we have not
had any clangers today.
Q153 Mr Evans: I think, like Philip,
the whole situation is mad anyway, with this advertising stuff.
They will be blindfolding children going round supermarkets next,
because that is the ludicrous extension of where we are going
on this. Do you know of any international examples where they
have banned or controlled advertising amongst children's television,
and has this had a similar impact?
Mr Watts: Yes; there are a number.
Sweden is a famous country which is always held up as one in which
no advertising of any shape or form is permitted around children's
programming. I am not an expert on the children's obesity rates
in Sweden but it might be worth somebody having a look at it.
There are countries where funding is available to support and
encourage investment in children's programmes where advertising
restrictions also apply. Australia is a good example of this and
Canada is a good example of this, where there are advertising
restrictions around children's programmes in certain sectors,
and in Australia and Canada there are very, very healthy funds
or tax breaks or incentives which for some time now have successfully
been stimulating production of children's programmes.
Q154 Mr Evans: Do you think this
is just a general malaise and that perhaps the advertising restrictions
add to the malaise, that if there were no restrictions coming
in there would still be a problem with children's television?
Mr Watts: Yes.
Mr McVay: Yes. For a few years
now, we have been discussing the creation of some sort of fund
previously around children's animation, because there was a real
issue with that, because animation is a very expensive way of
production. What we saw about a year and a bit ago was that there
was a whole move within children's where we felt that was not
just one type of production process, or genre, which was under
threat, it was an entire genre in itself which was coming under
pressure.
Q155 Mr Evans: Let us give it five
years then; let us fast forward five years: ITV?
Mr McVay: No children's.
Mr Watts: Channel 4, no children's
for some time; Five, less. Five invests probably about £4
million-£6 million a year in children's original programming
in this country. They are also obviously under pressure because
of the food and drink restrictions. Nickelodeon, which is the
only notable one of the cab/sats which has any kind of visible
investment, gains something in the order of about £4 million-£5
million, but obviously they are feeling the pinch too because
food and drink advertising restrictions will affect them also.
We believe that what will happen, actually in less than five years,
is that we will go from a situation of about £35 million
a year, invested by the commercial broadcasters in public service
broadcasting of children's programmes, down to something like
£5 million.
Q156 Mr Evans: Do you think any of
this has got anything to do with the migration of youngsters onto
the internet, and do you think that you will see provision of
children's entertainment, call it what you will, we are talking
about quality entertainment here, that it will migrate to the
internet and that may get round some of the commercial difficulties
which exist currently?
Mr McVay: The problem we know
with all the internet aggregators and providers is that none of
them puts money into original content; that is not their business,
they are not commissioners and it is very expensive to set that
up. You can see, at this stage in their business, they are not
really going to set up an entire commissioning team for content.
I think what the internet does, and I know this from my own children,
is that where you have got great programming on television, which
is a call to go and do something on the internet, cosies or something
else, it is a fantastic way to get them into multi-platform. There
is nothing to stop programmes in the future being available to
children downloaded from a children's internet portal, there is
nothing to stop those, and I hope to see those things happening.
What is very clear, going forward, is that people will not be
watching television as much as they have watched it in the past,
but I think there is still a place for great children's content
to be made available to British children, and if that is through
the internet, mobile 'phone, PSP, whatever it is, I think that
is all to the good.
Q157 Mr Evans: They will be fairly
indifferent as to how they get it, as long as they get it?
Mr McVay: Yes. I think the platform
is just going to be a fact of life; we will use different platforms
for where we are, what we are doing, what we are interested in.
The question is how you get the content there in the first place.
Q158 Mr Evans: I am just interested
as well that if this migration does happen to different sorts
of platforms, either with product placement or indeed the advertisers
sponsoring things on the internet, that is one way of them getting
round it?
Mr Watts: Yes.
Mr McVay: Whether they will be
as interested in what we would see as PSB children's programming
or not is another matter.
Q159 Mr Evans: In the meanwhile,
they will have seen the destruction of children's television on
the traditional platform?
Mr McVay: Yes.
Mr Watts: Some producers are trying
to find interesting ways to transport some of their programming
onto the internet so that whilst the child has watched the programme
on air then they can go and play off air on the internet. There
are programmes out there which are being developed which you can
find, a limited number but there are some where this notion of
multi-platform is being developed, but there is no commercial
model right now. Nobody has worked out how to turn a form of off-air,
internet entertainment into a commercial model; it is all free
access.
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