Memorandum submitted by the Writers' Guild of Great Britain

 

1. The Writers' Guild of Great Britain is a trade union with 2,200 members, representing professional writers working in broadcasting, theatre, film, publishing, video games and new media. We negotiate collective minimum terms agreements with the BBC and others which set down the minimum fees and other payments that are made to the writers of television and radio drama and comedy scripts. We estimate that about half our members are either currently working in broadcasting or have previously done so. All these members receive royalty payments when the shows they have written or created are commercially exploited by BBC Worldwide.

 

2. We note that the Committee has announced an inquiry into the commercial operations of the BBC, and as this has a direct impact on the livelihoods of our members, we should like to submit some comments. We shall arrange these under the headings supplied by the Committee.

 

a. The benefits and opportunities offered by the BBC undertaking a range of commercial activities in the UK and abroad

 

Professional writers benefit from the BBC commercially exploiting television programmes in the UK and abroad. Contracts for writers on drama and comedy shows generally include an initial fee, which covers the first broadcast(s) of the programme, plus the right to further payments if and when the programme is repeated by the BBC; shown on another UK channel; shown on an overseas channel; retailed as a DVD or download. Therefore the greater the exploitation the BBC is able to make, the higher the payments to a writer are likely to be. Moreover the payment structure means that the writer of a popular show will receive significant extra payment, while the writer of a less popular show is likely to receive little more than the initial fee - which introduces a strong element of market fairness.

 

Payments by BBC Worldwide under Writers' Guild agreements were over £8 million in each of the past two complete financial years. These payments include international TV sales and DVD sales. Some of the biggest sellers were Jekyll, Mistresses, Primeval, Doctor Who, Torchwood, Gavin and Stacey, Robin Hood, Cranford, Sense and Sensibility and Oliver Twist - all with scripts written by Writers' Guild members. It is worth mentioning that BBC Worldwide does not only distribute programmes made for the BBC - it also handles shows made by independent producers for other broadcasters.

 

The success of BBC Worldwide in selling programmes to other countries not only generates considerable income to this country, but also ensures that UK cultural material is widely available around the world, enhancing the reputation of the UK. The scale of this commercial activity is demonstrated by BBC Worldwide's annual sales convention, held in Brighton every February, which is attended by over 500 buyers and executives from television broadcasters and distributors all over the world.

 

BBC Worldwide also distributes radio programmes by means of overseas sales and the lively audio books market.

 

From the writer's point of view, this exercise not only brings financial rewards but also provides a showcase effect whereby overseas television producers recognise talent and commission work from UK writers for their own shows - this effect is particularly noticeable in the United States.

 

b. The potential risks to the BBC, licence fee payers and other stakeholders

 

There is a risk in the aggressive commercial exploitation of television shows, which is the risk of over-exposure. If a programme is repeated too often the public may grow tired of it and this could damage the prospects of future DVD or download sales, for example, and could also reduce the chances of further programmes of the same type being commissioned. This could be damaging to a writer's income and future prospects. In our experience the BBC and BBC Worldwide are aware of this risk and in the main are careful to manage the exposure of individual programmes and series.

 

c. The extent to which the BBC's commercial activities meet the criteria required of them

 

We support the principles governing all BBC commercial services, which are that they must: Fit the BBC's Public Purposes; Exhibit commercial efficiency; Not jeopardise the good reputation of the BBC or the value of the BBC brand; Comply with fair trading guidelines and avoid distorting the market. We believe that these requirements, and those of the BBC Trust's Commercial Services Protocol, are adhered to quite strictly. In general terms BBC Worldwide meets the basic requirement put on it, which is that it contributes its annual profits of about £118 million back to the BBC for investment in new programmes. This is money that is not available from the BBC Licence Fee or any other source. This is of value to the UK viewer and to our members alike, as it enables the production of new programmes that otherwise would not be made. Without it there would be less UK original material on BBC screens, and less work for professional writers.

 

d. The appropriateness and effectiveness of the governance framework for the BBC's commercial activities

 

It seems to us that the governance framework for the BBC's commercial activities is unusually detailed and strict. That is not to say that it is inappropriate, as it is important that the BBC - funded by the legally imposed licence fee - must be fully accountable to the public, and it is also important that the BBC should not overpower and thus distort the rest of the UK broadcasting and new media market.

 

In this context it is notable that the BBC has, for the past few years, been under constant scrutiny. The revision of the Royal Charter and the renewal of the licence fee settlement this time around were carried out over an extended period and with great thoroughness. All this was in the shadow of the ordeal; of the Hutton report. Currently BBC Worldwide's plans are also under close scrutiny by the Competition Commission and the Office of Fair Trading, at the same time as this Committee inquiry. It is not unreasonable to suggest that such constant scrutiny, calling on considerable time and resources, is unique to the BBC and might even tend towards the excessive.

 

The governance arrangements of BBC Worldwide were rewritten within the past two years, and the organisation is now firmly watched by both the BBC Executive and BBC Trust. We think these new arrangements need at least five years to bed in and operate consistently before a meaningful review can take place or further reforms are proposed.

 

e. The future of BBC Worldwide and other BBC commercial subsidiaries

 

Futurology has suddenly grown much more difficult in the current economic circumstances. Perhaps if there is a deep and long recession it may be reflected in an upsurge in cheap mass entertainment, much as people flocked to the cinemas in the 1930s. This could lead to more popularity for free-to-air services (not just the BBC) and slower growth for paid-for product such as supplied by BBC Worldwide in the UK. However, internationally the demand for programming could improve the opportunities for BBC Worldwide to export UK productions. We do not have any comments to offer on other BBC commercial subsidiaries.

 

f. How the money returned to the BBC by its commercial operations is invested

 

As stated above we understand that the profits of BBC Worldwide are returned to the BBC to fund the development and production of new programmes that would otherwise not be made. We welcome this and would not wish to see these funds diverted to any other recipient or purpose. We do not have any comments to offer on other BBC commercial operations.

 

g. Other areas of interest

 

There is worldwide concern at the widespread illegal downloading and file sharing by individuals and mass piracy of TV programmes, films, music, video games, etc. BBC Worldwide has entered agreements with YouTube, MySpace and iTunes to make UK content legally available as widely as possible. While this is far from a complete solution to these problems, it is a strategy that reduces the incentive for ordinary people to obtain material by illegal means and maximises the chances of income being generated for the BBC - and for individual writers - by the retailing of programmes and extracts or their support through advertising.

 

3. The Writers' Guild of Great Britain hopes these comments will be useful to the Committee in its inquiry. We would be ready to attend and give oral evidence should you wish us to. We thank you for inviting our comments and for taking notice of them.

 

October 2008