Select Committee on BBC Charter Review Minutes of Evidence


Examination of Witnesses (Questions 240 - 259)

WEDNESDAY 9 NOVEMBER 2005

Mr Roger Mosey and Mr Dominic Coles

  Q240  Chairman: Do you think that if cricket goes on to pay TV it is going to have an impact on new young people taking up the game seriously if they do not have access to it?

  Mr Mosey: I think that is a worry. The worry is that cricket as a sport is effectively going to be exclusively live on pay TV, so there will be no cricket available live on terrestrial TV at all. The mix you have got in football at the moment we think is rather appealing for viewers and everyone else. Sky have live Premier League games, we have Match of the Day, we share the FA Cup with Sky, Sky share the Champions League with ITV, so there is a diversity of supply and you have got big terrestrial audiences coming to the BBC for major live FA Cup games. The worry with cricket is that it is absolutely the case that audiences will go down next year because of the pay TV dimension. I do not know, I think the jury is out. We cite and believe there is a pretty interesting precedent in rugby because at one point England rugby was exclusively on pay TV and it went to much smaller audiences. It was interesting that the rugby authorities wanted to come back for the Six Nations and to have all the Six Nations' matches on the BBC.

  Q241  Chairman: You cannot divide up cricket in the same way as you divide up the Premier League, Match of the Day and highlights of the day.

  Mr Mosey: We have a number of options.

  Mr Coles: We look long and hard at this. My team and I had 15 meetings with the ECB when the rights were first being tendered to try and explore a way in which, in the crowded way that the BBC operates, to fit cricket in there. The schedules which were produced overlap with World Cup football, with Wimbledon, with Open Golf, with a whole number of contractual obligations which we took on way back in 1999 and subsequently to fill the holes left by cricket. What we tried to work out with the ECB was whether or not a more flexible approach to the way in which they sold and packaged their rights would actually deliver us the opportunity to take an odd Test match here and there, maybe even a session here when another session went on under Sky, or allow Sky to show everything and we can dip in and out when it suited our schedules, so at least you could still get some visibility for the licence fee payer. At the time we had some very fruitful discussions with them and it may be something to look at for the future. At the time I do not think the ECB anticipated that they would be losing Channel 4 as a terrestrial broadcaster. If we were having those discussions today with Channel 4 out of the picture then I think those discussions could go somewhere. That is why I am encouraged, particularly with our strive to get into digital technology and digital ways of distributing content, that when we sit down with them again to talk about the future we may be in a situation where we can deliver something.

  Q242  Chairman: But nothing can happen before 2009.

  Mr Coles: A commercial contract has been signed. I cannot see that going back.

  Q243  Chairman: We seem to have your pledge that you are going to be fighting it quite hard when it comes to that.

  Mr Coles: We will. We have an obligation to licence fee payers for all significant sports rights, to look at them and to try and secure some of that action for the BBC.

  Q244  Baroness Howe of Idlicote: You have given instances of the various occasions that you have bid for and achieved. How do you define what is a crucial or a major sporting event? What are your tests for arriving at that conclusion?

  Mr Mosey: Some of it is simply numerical. We know that the Olympic Games and the World Cup will get big audiences. If you take Wimbledon, the importance of Wimbledon as a cultural phenomenon as well as a sporting phenomenon to the UK is obvious and Wimbledon has been the premier tennis tournament in the world, it is something that the BBC would want to deliver to terrestrial audiences. We are undertaking a major piece of work at the moment as part of a programme strategy review at the BBC which is assessing which sports we think are developing and which sports maybe need a bit of refreshment so that we can provide a portfolio which is balanced and balances major events and some minority sports as best we can.

  Q245  Baroness Howe of Idlicote: In terms of developing sport, how crucial in coming to your conclusions is the fact that the younger generation may not be interested in sport at the moment? Sport generally is now coming back on to the agenda. It is now even popular to encourage schools to play sport when at one stage it was not at all, it was too competitive and so on. Your role there as a public service broadcaster is in actually engaging with young people as well as those who are already into various games. How crucial is that in your definition of crucial?

  Mr Coles: It is absolutely critical. We do feel we have an obligation to showcase not just the biggest, grandest events but also the more minority public service sports which are struggling to get visibility in an increasingly polarised sports marketplace. What I have found in the last five years is that the funding that is available from broadcasters and from other investors in sport is increasingly focusing on the big events and that is primarily about football but also the big rugby events and the cricket events. There is a polarisation going on at the moment. A lot of sports are going to be left behind. I feel the BBC has a responsibility, through the Olympics coverage, through the Commonwealth Games coverage, through the Grandstand coverage, to continue to serve those sports as well. However, that is within the constraints of where we operate and within the two linear channels in which we operate where clearly they are multi-genre channels and we have to compete for the air space against current affairs, religion, drama and comedy. We cannot have it all, but we certainly do like to punch our weight in to ensure that we are delivering to those sports as well as to the big sports.

  Q246  Baroness Howe of Idlicote: How important will the new technical development be in selling sport? I am thinking of high definition television and so on because that could be quite crucial in the cost aspects of what you are doing. You have described the method of how you are bidding and getting into the marketplace and so on. Could you give us some idea of just how the pattern might change year-on-year and what the actual spend is? In one year you might be bottom of the league with all the other competing pressures.

  Mr Coles: The advantage of running a five-year rolling budget is that it allows us, almost uniquely in the BBC, to plan ahead by up to five years or even further in respect of the World Cup in 2014, for example, which is a great advantage to have. It means that we can take on contractual commitments which give us certainty. In terms of building the blocks that deliver the overall BBC portfolio and delivers to the licence fee, we can build those with quite a lot of certainty and security.

  Q247  Baroness Howe of Idlicote: Let us say we were looking at a graph. How would it look?

  Mr Coles: Crudely, in terms of our spend, in the even years when you have the Olympics, you have the World Cups and you have the European Championship football you spend a lot more than you do in the odd years when you do not have those major events because clearly the major events cost a lot more money and commit a lot more resource to those summer big moments.

  Q248  Chairman: Can you put some figures on it?

  Mr Coles: It adds around £80 to £100 million a year in terms of the step up in a major event year. When you have got the Olympics and the World Cup that is going to significantly increase your spend across sport.

  Q249  Chairman: What would the average be?

  Mr Coles: You are going up from between £250 and £300 million to £350 to £400 million.

  Q250  Chairman: A year?

  Mr Coles: Yes. So you are looking at going up by 25 per cent in a major events year and then coming down by 25 per cent when you fall out of that into an odd year. In terms of a graph of where the BBC spend has gone, certainly since I have been in BBC Sport and certainly during Greg Dyke's time as Director General, he recognised that we were struggling at the time to compete for major sport and he invested a lot more money into sport than traditionally had been invested and that has been sustained, so we have been funded quite well.

  Q251  Bishop of Manchester: The Governors recently endorsed the plan for the removal of your department up North. I am not here to promote or demote the significance of that for the City of Manchester and the City of Salford. What I would like to explore is the significance of that for your department. Were you properly consulted? From your point of view what are the pros and cons? In the end will it produce an even better department? It seems to me quite a crucial time in the history of the broadcasting of sport in this country to be making what clearly will be quite a major physical move at any rate.

  Mr Mosey: I should say that I come from Bradford and so it is moving to the wrong side of the Pennines. I think it is vitally important that the BBC spends its money around the UK and invests in the creative industries around the UK. I have no doubt at all the BBC should be in significant mass in centres outside London. I personally think that Manchester gives us a chance to revise some of the ways we work, to have a new creative environment and also to support local industries and local creativity in the North West and across the North generally.

  Q252  Bishop of Manchester: So some of the rumours that one has picked up from within the BBC and particularly within the department that this is disastrous news is not shared by you?

  Mr Mosey: No. There are mixed feelings about moving to Manchester. Clearly people have homes and families and social networks in London and therefore it is a significant move for people to think about going 200 miles north, I absolutely accept that. I think you have to ask the question the other way round, which is should the BBC spend so much as a proportion of its money in London forever? I think you have to make significant commitments to the regions of the UK.

  Q253  Lord King of Bridgwater: How many people is it?

  Mr Mosey: It is a total of between 1,500 and 2,000.

  Mr Coles: Five hundred will be BBC Sport.

  Q254  Baroness Gibson of Market Rasen: How are you dealing with this in people terms? You have said it is a major thing for someone to be asked to move somewhere else. Are you offering packages?

  Mr Mosey: First of all, on the timescale, we will not make a final decision about Manchester until after we know about the licence fee settlement, so that will probably be some time in April or May of next year. The plan is that we move to Manchester in 2010, so we will have a four-year transition for our staff in which we will ask whether they do or do not want to move to Manchester, offering relocation packages if they do want to move and if they do not want to move there will be deals available to them or relocation within the rest of the BBC.

  Q255  Chairman: Why is it going to cost more or is sport not going to cost more in Manchester because the whole move looks as though it is going to cost more year-on-year-on-year? I do not understand why that should be the case.

  Mr Mosey: These are issues you may want to pick up when you talk to the Director General and the Chairman. I think you have to make an investment in the regions in order to deliver a building that is fit for purpose. We should not under-estimate the fact that any building that has got to have a significant broadcasting infrastructure is quite expensive and actually, if we are dealing properly with people, some of the relocation costs are also significant. I think there is a net spend in the first years of the Manchester project with savings further down the line.

  Q256  Chairman: Do you envisage savings further down the line? After what period?

  Mr Mosey: Over a 25-year period.

  Chairman: That is ambitious!

  Q257  Bishop of Manchester: What about the opportunities that a hub presents? Do you see that there will be values to be gained from being alongside ITV and other independent producers or will that not affect the sports department?

  Mr Mosey: I think it is important that the BBC is part of a community. We would hope that independent producers might consider moving to Manchester and that there might be a media village. We have discussed, for instance if we have a big studio, whether the big studio might be available for other forms of arts and recreation. Also, I like the idea that we should have a degree of public access and public visibility. As you will know if you have seen the open centres we have in Hull and in Blackburn, getting the public involved in broadcasting is an absolutely fundamental role that the BBC should do.

  Q258  Lord Holme of Cheltenham: I would like to ask about listed events. As I understand it the purpose of listing is to give you and other terrestrial broadcasters—or is it other public service broadcasters or is it other analogue broadcasters—a first crack and a protected zone which one could well argue is in the interests of the licence payer and the viewer. Is that going to survive into the digital age which we have heard so much about? Is that system going to work? How will it work?

  Mr Mosey: I think there is some misapprehension about the switch-off of analogue and the effect on listed events. I see it essentially as free-to-air versus pay TV. BBC One in a digital era will still be available to 100 per cent of the population. Subscription television services obviously put a significant barrier for people on low incomes or people who are casual viewers. I think it is £408 a year for the most basic subscription package that includes sports channels. There are people who cannot afford to pay that on top of the licence fee. The second thing, of course, is there are sports events that bring in casual viewers. You may not want to watch of the whole of the Ashes series but you may want to come in for the final day of the Fourth Test and the climatic Fifth Test and that is really a dilemma for people, about whether they have to pay to buy a whole year of sports broadcasting when really a terrestrial broadcaster or a free-to-air broadcaster can bring them in for those major sporting moments.

  Q259  Lord Holme of Cheltenham: Do you think more events should be listed?

  Mr Mosey: I think in a way this is a debate for within the industry and we are keen to take part in that debate. My personal view is that I think it is odd that no cricket at all is listed. If you look at the DCMS letter in 1998/99, there was an assumption that cricket would still be available in some form on terrestrial television. The fact that no cricket is available is an interesting question for debate going forward about should some cricket be listed.


 
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