Joint Committee on The Draft Communications Bill Appendices to the Minutes of Evidence


Memorandum submitted by the Directors Guild of Great Britain


  1.1  The Directors Guild of Great Britain is an independent trade union for professional directors across the arts and media industries. DGGB members, are likely to be significantly affected by the contents of "the draft Communications Bill" and the outcome of the Joint committee's inquiry. The DGGB welcomes the call for evidence and provides the following information to improve the level of debate of the inquiry.

  1.2  Directing is central to the success of the British broadcasting industry. Directors are content providers as well as consumers and members of the public and their role in creating original production, within the context of the forthcoming legislation, has an important role in fulfilling the governments overall aims of diversity, plurality and a dynamic and competitive broadcasting economy.


  We welcome the appointment of Lord Puttnam as Chairman of the Joint Committee and note the Joint Committee expects to concentrate the inquiry on the following themes:

1.   The proposed structure, functions, duties and powers of OFCOM,


  (i)  OFCOM's accountability to Parliament;

  (ii)  OFCOM's proposed relationship with the BBC;

  (iii)  the relationship between OFCOM and the Secretaries of State;

  (iv)  proposed statutory provisions relating to OFCOM's dealings with its stakeholders;

  (v)  the regulatory impact of OFCOM's work and its charging structures;

  (vi)  the proposals relating to the Consumer Panel; and

  (vii)  arrangements for transparency in the work of OFCOM[52]

  1.1  It is noted that applications are already being invited for the Chair of the new regulator for the entire media sector—OFCOM—which will implement the new regime set out in the Communications Bill.

  1.2  This new watchdog is potentially the most influential body there has ever been in our cultural lives. The Bill covers issues, which will significantly affect British culture and democracy. While charged with maintaining innovation, work of distinction and a plurality of voices we are concerned that it is still not clear how the Chair & six non-executive OFCOM members will be appointed, nor how the public's interests, and those of creators such as directors, will be represented.

  1.3  Specifically we are also concerned as to how the board's different areas of interest will be divided up between broadcasting specialists, telcoms specialists, and consumer interests. It is disappointing that creator's interests are not specifically referred to in the draft legislation but presumably they are included in the use of the term "broadcasting specialists". The Bill is silent on whether these specialists will have the necessary overview of all public interest obligations. Therefore we are unable to see how in practice the current proposals can claim to secure and protect the public interest in the digital future.

  1.4  We note the proposal for OFCOM to take an overview of public services broadcasting and comment on performance—although it is not yet shown how this is to be achieved in practice, particularly as some of the regulatory proposals as they apply to the BBC are still to be implemented by changes to the BBC Agreement not the Communications Bill itself. It is submitted that further consideration should be given to retaining the present system of dual regulation in the UK which distinguishes between the commercial sector and the public sector, not least because of the increasingly different needs and expectations of the two sets of broadcasters.

  1.5  On our understanding the proposed single regulator OFCOM will be answerable jointly to the Department of Trade and Industry and to the Department of Culture Media and Sport. However we are concerned that the majority of responsibilities for broadcasting will be given to the DTI, which is mostly concerned with commerce and competition policy which may be at the expense of existing and future cultural considerations.

2.   The proposed framework for the promotion of a dynamic and competitive communications and media market in the United Kingdom


  (i)  proposals relating to media ownership;

  (ii)  proposals relating to electronic communications networks and services, including access provisions, must carry/must offer provisions and the development of the broadband infrastructure;

  (iii)  investment in the communications and media market;

  (iv)  proposals relating to the use and management of the radio spectrum;

  (v)  the proposed competition powers of OFCOM and their relationship to the powers of the Office of Fair Trading, the Competition Commission and the European Commission; and

  (vi)  striking the correct balance between the wider interests of the consumer and the provider[53].

  2.1  The Government's general approach on media ownership is not accepted by the DGGB. In particular the Government's policy reasoning is not accepted (namely that competition law will appropriately address issues of concentration, efficiency and choice to make markets work as efficiently as possible, and to encourage new entry). We do not agree that the regulatory framework provided by the rest of the Bill will maintain the diversity, quality and impartiality of broadcasting content.

  2.2  The DGGB is very concerned about the unexpectedly wide deregulatory scope of the proposed legislation. It is noted that one of the policy considerations for deregulating Media Ownership has been that "Communications markets are fast moving, with high levels of technological innovation".

  2.3  However the Government's claim that "The future is uncertain and the need for ownership rules may be reduced"[54] (emphasis added) is not sustainable. Indeed given the uncertainty of the future it is strongly suggested that a more cautious regulatory approach is required. Therefore the Bill's emphasis on lighter regulation and more reliance on competition law are not at all reassuring given the significant social and cultural considerations involved in the broadcasting medium. [55]

  2.4  It is submitted that market dominance is potentially bad for quality and creativity and the current proposals are likely to make various kinds of dominance more likely to occur. The UK's trade in audiovisual services, while continuing to grow, faces an increasing competitive international market dominated by the USA. The UK also faces a growing trend towards concentration of media ownership with seven large multinational corporations being dominant in the market.

  2.5  We are deeply concerned that established investment and broadcast of high quality British drama, documentary and film programming will be placed under threat with ownership from outside the EU. The draft bill must be amended to change the current position. Particularly when the proposals are not reciprocated by the USA and it is important to note that the USA itself imports less than 5 per cent foreign television with strict rules preventing foreign ownership.

  2.6  It is submitted that opening up ITV to potential ownership by large vertically integrated American concerns could lead to even more US imports with significant follow on effects for British television (including fewer quality UK dramas). Not least because it is cheaper to import ready made programmes from America than invest in original production in the UK (even though most viewers prefer domestic programmes). [56]Indeed the Bill in its current form could narrow the range of programmes and reduce the level of innovation by creating more uniformity thereby undermining future opportunities for creative talent including directors and others.

  2.7  Within the context of the Inquiry Panel to Investigate British Television Exports the DGGB submitted that the UK's significant balance of trade deficit and increased expenditure on acquisitions was predicable. Indeed the Report of the Creative Industries Taskforce Inquiry into Television Exports noted the UK spent a "greater proportion of our television budget on acquisitions than Germany, Italy or the Netherlands (a reverse of the position in 1991)." [57]

  2.8  As the Creative Industries Taskforce report noted, of the many new channels broadcasting, only a small number invest in producing their own programmes. Whereas the majority depend heavily (almost exclusively) upon cheap, mainly American, imported programming to fill the available airtime. This lack of investment in original programming indicates a short term approach, which places instant returns above sustainable growth. The Trade deficit suggests that positive regulation is needed to invest in UK originated material. In the longer term this will attract and retain audiences as well as developing their channels as exploitable resources.

  2.9  The changes proposed in the Bill will significantly impact on the future ownership of Channel 5 and ITV, which in turn raises specific concerns about content regulation. It is submitted that more not less content regulation is required if additional investment is needed in the UK.

  2.10  Mark Thompson, Channel 4 Chief Executive, has expressed concern that Channel 4 could be squeezed for revenue between C5 & ITV, if they go for all programmes with an audience of 5 million or more thereby undermining C4 advertising base, its commercial platform funding its Public Service Broadcasting obligations. There currently are no proposed specific rules on the cross promotion on terrestrial television on any cable/satellite/newspapers owned by the same group. Concerns arise again regarding market dominance if in the purchase of TV rights, for example, a single player dominates pay TV and also controls a terrestrial channel; in the selling of television advertising space; or in cross promotion from terrestrial TV to newspapers to pay TV and back again.

3.   The proposed statutory framework for content regulation

  Including the definitions of:

  licensable content, broadcasting and public service broadcasting. [58]

  3.1  It is noted that one of the key aims of the Bill is to "retain a diversity of content from a plurality of sources." Specifically that the regulatory framework provided will supposedly "ensure that any increased concentration of ownership does not dilute the quality, diversity or impartiality of broadcast content"[59]

  3.2  While we welcome the requirement on OFCOM to establish and maintain a "content board" nevertheless we are not convinced it will be able to ensure that the public's interest in the nature and quality of television programmes will be strongly represented within OFCOM's structure.

  3.3  It is submitted that the bill has not balanced the cultural objectives of the UK broadcasting industry with the demands of the market driven telecom's industry (ie "Content" and "delivery" or "carriage" issues along with "public" and "private" issues are all separate). OFCOM will clearly need to maintain formal distinctions between these issues. Yet it is still not clear what form of representation the UK creative community will have on OFCOM.

  3.4  With potential ownership coming from outside the EU, there are no adequate safeguards to ensure new owners would maintain the established investment and broadcasting of high quality British drama, documentaries and film programmes. Broadcasting legislation should clearly state and ensure that our framework is designed to reflect British creativity and talent, our multicultural diversity and social values.

  3.5  What rules are there in the draft legislation for all channels to encourage investment in UK drama, documentaries, and above all feature films? For example, cable and satellite content could be regulated, via investment obligations, as is already the case in Canadian/Spanish/Italian/French law to re-invest 3 per cent of advertising revenue or 5 per cent of turnover.

  3.6  Will OFCOM be responsible for cable and satellite channels regulations and not the Department of Culture Media & Sport?

  3.7  Will OFCOM be given a general oversight/monitoring/implementation/reporting responsibility for the EU Television Without Frontiers Directive?

4.   The place of nations, regions, localities, communities and interest groups in the proposed framework[60].

  4.1  UK legislation should reflect British creativity and talent, our multicultural diversity and social values and the draft bill should clearly state this. National drama, documentary, feature films and TV films all play an important role in developing and reflecting a sense of local, regional and national identity, character and cultural diversity as well as ensuring a strong audiovisual industry that is competitive nationally and internationally.

  4.2  The primary responsibility of British Broadcasters is to make a diverse range of high quality programmes, which satisfy the needs of the domestic audience. British audiences must be allowed to see programmes that are made for their own consumption, not for a homogenised global culture. [61]

  4.3  In May 2000 a gathering of film professionals from every continent in the world concluded the following statement: [62]

    —  "Recognise that cultural diversity, particularly in the audiovisual media, deserves to be protected nurtured and supported throughout the world;

    —  International forums and processes, including those focusing on international trade, must respect the need for nations to protect, nurture and support that diversity;

    —  Governments should be invited to consider policies necessary to support the diversity of cultural expression. At the international level, there is an urgent need for the negotiation of a new international instrument on cultural diversity to address issues related to cultural products in all their aspects. This could be adopted within the United Nations as a legal framework which would subject the WTO to respecting universal rules";

    —  A permanent international Forum should be created to serve as a platform for open international dialogue and discussion on the issues of cultural diversity, involving civil society, governments and industry and all those concerned with the preservation of cultural diversity;

    —  Reaffirm the European Union position that audio-visual matters must not be put forward for discussion within the WTO.

5.   Further Inquires[63]

  The Directors Guild welcomes the joint committee's assurance that it will finalise its decisions on the remaining hearings in light of written submissions received by the given deadline. We therefore expect directors' concerns to be included in these continuing inquiries.

June 2002

52   Joint Committee on the Draft Communications Bill Press Notice 2 Call for Evidence; Public Hearings (16 May 2002). Back

53   Joint Committee on the Draft Communications Bill Press Notice 2 Call for Evidence; Public Hearings (16 May 2002). Back

54 (The Draft Communications Bill-The Policy "Media Ownership paragraph 9.1.5). Back

55   Voice of the Listener and Viewer. Spring 2001 Back

56   "New Future of Missed Opportunity? Reactions to the draft Communications Bill 2002" Westminster Media Forum. Stephen Barnett Professor of Communications, University of Westminster. Back

57   Report of the Creative Industries Taskforce Inquiry into Television Exports, 1999, for the Inquiry Panel to investigate British Television exports. Back

58   Joint Committee on the Draft Communications Bill Press Notice 2 Call for Evidence; Public Hearings (16 May 2002). Back

59 narrative/550810.html (The Draft Communications Bill-The Policy "Media Ownership paragraph 9.1.7). Back

60   Joint Committee on the Draft Communications Bill Press Notice 2 Call for Evidence; Public Hearings (16 May 2002). Back

61   DGGB Submissions to the Inquiry Panel to Investigate British Television Exports 12 July 2000. Back

62   Valencia Statement on Globalisation and Cultural Diversity, Forum on Globasisation and Cultural Diversity, the Challenge to the Audiovisual Industry, Valencia, Spain. 22-24 May 2000, Organised by Fundacion Valencia Tercer Milenio and ADC Nouveau Millenaire, under the patronage of UNESCO and the support of EU Commission and Valencia City Council. Back

63   Joint Committee on the Draft Communications Bill Press Notice 2 Call for Evidence; Public Hearings (16 May 2002). Back

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