Examination of Witnesses (Questions 160-169)
PACT
27 FEBRUARY 2007
Q160 Chairman: Does Pact represent
the games production companies?
Mr McVay: No, we do not. They
have their own games trade association, called TIGA.
Q161 Chairman: Is there a case perhaps
you see in the future, given that there is a sort of slow coming
together of all these different media, that you might?
Mr McVay: We have been holding
very useful discussions with them about common issues. I think,
critically, for governance, going forward, we are very keen to
make sure that the role of content producers and IP creators is
clearly understood, because it is a major part of the UK economy,
it is growing faster than most other parts. Indeed, the independent
sector, from our recent survey, is growing at 9% year on year.
I was in LA in November and on the front of USA Today was
"Brit formats rule networks," which was very useful
as we were going round all the US networks at the time.
Q162 Alan Keen: You seem to have
no doubt about being in favour of some public funding for children's
broadcasting, but when it comes to the Government's intention
to look at the possibility of distributing public funding wider
than the BBC you have got reservations and the top-slicing you
fear for. Could you expand on that?
Mr McVay: I will be very honest,
we are quite conflicted on that, because I represent drama producers,
factual producers, entertainment producers and children's producers,
so, in a sense, if you top-slice are you robbing Peter to pay
Paul, so where does the money come from, are you robbing the licence
fee-payer from a drama budget in order to fund something else.
I think that is a difficult judgment call, particularly for me,
when I say it. I think it is an issue about the top-slicing argument.
I suppose the other point about that is if you use the top-slice
to fund ITV to make children's programming, are you just rewarding
ITV shareholders, because they have pocketed that money in the
past. I think that is a difficult argument as well.
Q163 Alan Keen: What are the dangers
though of top-slicing the BBC's money and distributing it more
widely?
Mr McVay: One, I think, if you
did top-slice, if you did go down that route then what is the
mechanism for that. Certainly, from where we sit, we would like
to see much of the market involved in that, rather than having
our, what is often mooted, arts council of the airwaves type approach.
I think the more you move it away from the realities of the television
market and television audiences the less likely you are to get
a good return on that investment. I think the mechanism is an
important one on that. The other point is, if it came out of other
programme budgets then other producers are not getting the budgets
to deliver quality programming which BBC licence fee-payers quite
rightly expect they should get.
Q164 Alan Keen: If somehow I could
force you to say yes or no to taking any money from the BBC, what
would you say at this moment?
Mr McVay: I would say, no, at
this point in time, until we were really assured about where it
came from within the BBC, what it is used for and how it is going
to be delivered.
Q165 Alan Keen: If you were not allowed
to wait, if you had to say now, you would say, no?
Mr McVay: I would say, no, at
the moment.
Mr Watts: I would say, no, too,
because the notion of anything which comes out of programme budgets
surely basically just means that the BBC have less money to spend
on quality programmes, so it just goes down one column and goes
up the other, and that does not seem to make sense.
Mr McVay: I think our key issue
is, particularly in children's programming, leaving aside other
PSB genres, we are more interested in trying to argue that there
needs to be a strategic intervention which adds to the pot rather
than it is the same pot. I think that is the question.
Q166 Chairman: Which brings us neatly
on to Mr Richards and the PSP; is that something you find more
attractive?
Mr McVay: We argued, during the
Philip Graf review of BBC online, that the BBC should be required
to commission more content externally because this would help
build up the skills and creative knowledge for delivering content
on broadband, or, at that point, as it was called, the internet.
I think the PSB could be a sort of Channel 4 moment, whereby if
there was an intervention it could establish within that platform
a different PSB sensibility than what may be delivered by the
market. Again, I think that is a question for taxpayers and Parliament
to decide if we want that. If you look at the way television will
be received in the future, we are convinced certainly that it
will be through broadband by 2015; that space is unregulated,
although Ofcom may have a view about that going forward. There
will need to be some place in that new platform which is unregulated
and huge, in terms of the content available, where you maybe find
things that the market would not provide, so there may be a Channel
4 moment in there. In that respect, we are quite interested in
it, but we are not quite sure whether we are there yet. I think
what Ofcom have done, in terms of having a discussion about it
and teasing out the issues, is a very good way forward, because
it allows everyone to try to test that and see if it is something
we do value and something we think should happen, and then, again,
what is the cart and what is the horse.
Q167 Chairman: Also it comes back
to how you pay for it?
Mr McVay: It does, yes. I would
rather start from the position of is it something we value and
then work out how we pay for it.
Q168 Chairman: The last time you
came to see us we talked at some length about the rights, and
obviously there has been quite a lot of progress since then. Five
have said to us that one of the things they see is the most important
way in which they can provide public service material is via new
media platforms, and of course they are constrained from doing
so by the rights. Obviously you fought hard that essentially rights
should rest with the producers, rather than broadcasters, after
a fairly short period. Do you have any sympathy with Five's concerns
that they are restricted from doing that?
Mr McVay: I am a bit surprised,
because we have granted Five the use of rights to build up their
VoD and broadband services, and we will share in any revenues
that they generate from those services. I think it is a reasonable
position where, if you own a right and someone wants to exploit
it, you should get a return for that, obviously they should make
some money from it as well, otherwise why would they do it, but
they are absolutely in a position where they can acquire those
rights. We have agreed with them a certain VoD window for their
programming so they can monetise it, but there is nothing to stop
them going forward if they think there is a programme, like CSI,
or something else, which they acquire from America. If there was
British programming they thought was a "must have" there
is nothing to stop them negotiating commercially with a producer
to take those rights and then exploit them.
Q169 Chairman: Obviously having to
pay an additional sum to do so?
Mr McVay: Yes, I think so, in
the same way that we have to pay Tarrant, we have to pay actors
and everyone else who has got a right in the programme. If broadcasters
exploit something, I think it is reasonable for them to pay rights'
owners when they are exploiting that content.
Chairman: I do not think we have any
more. Thank you very much.
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