Select Committee on BBC Charter Review Minutes of Evidence

Examination of Witnesses (Questions 840 - 859)


29 NOVEMBER 2005Mr Richard Sambrook and Mr Nigel Chapman

  Q840  Chairman: First of all, greetings to you. You have of course given evidence before, but it might be helpful for everybody in the room if you just said who you were and what your role is.

  Mr Sambrook: Certainly. I am Richard Sambrook, I am the Director of Global News for the BBC. My responsibilities are for the BBC's overall strategy for global news across television, radio and on-line. Nigel Chapman is the Director of World Service, with operational responsibility for the World Service.

  Q841  Chairman: Thank you very much. As you know, Norman Fowler, our Chairman, sends his apologies, but I am afraid it is an unavoidable clash of responsibilities. We are, of course, particularly interested—though there will probably be a few wider questions than this—in the area of what has happened since we last saw you, and you will have noticed no doubt that we in our first report did refer to this issue of the change in where the World Service was going to be concentrating some of its resources. I wonder whether we could just start off by you telling us what happened as a result of your recent review. What were the new priorities for the World Service that you decided upon and what was the role of the FCO in all that?

  Mr Chapman: We announced the outcome of the review on 25 October, about a month ago, and it has four elements in terms of new investments. Essentially this is a £30 million investment plan that we are talking about here by the end of this period, so it is a significant amount with reprioritisation and spending review money being used for new purposes. The purposes are essentially to make sure that the World Service operates with the right media in the right countries so that it can have maximum impact, because it is facing really significant competition now in so many places. We came to the conclusion that definitely in the Middle East, to start with, it was no longer going to be viable for us to just to broadcast on radio and provide new media services, we needed also to produce a television service in Arabic, so a central plank of this investment strategy is a 12 hour television service in Arabic. But it is not just that, it is also about improving distribution for radio on FM across the world, it is about improving our new media services, and we have got some very good new media services in languages other than English, and English too, but there was a risk that they were getting out of date and out of touch with the market, they were not up to speed really, so we needed new investment there. We needed new investment in our overseas bureaux and, finally, we needed new investment in marketing because it is great having great services from the BBC World Service but if nobody knows anything about them in increasingly competitive marketplaces then obviously it is very difficult to get listeners' attention. That was, if you like, the new investment strategy. That had to be paid for out of all the funds that we had received in the spending review of 2002 and also in 2004. We had prudently kept some money back from the 2002 spending review to help us with part of that putting in new investment, we obviously had the new money from 2004, but we also needed to release funds from some of the things we already did in order to pay for all this, and that is where the reprioritisation of the language services portfolio came in, because it released something like £12 million by the time we finished that exercise towards what is a £30 million plus bill, so it is a significant proportion of the funds. That is the balance financially and it is a strategy which will take us up until 2007/08 in terms of finance and also sets a long term pathway, if you like, up to 2010, because what it is really saying to government and to our stakeholders is we increasingly need to be a tri-media operator. Operating just with radio and new media alone in many markets will not do the job; it is clearly most pressing in the Middle East but there are other parts of the world too which maybe you want to talk about—Iran would be another example—where I believe that, over time, the BBC will be broadcasting in the relevant languages on television as well as on radio and on the Web. That is the background to the review.

  Lord Holme of Cheltenham: My Lord Chairman, I should declare an interest. I am chairman of a market research company which conducts the BBC world poll for the BBC, Globespan. I am really very curious about the candidates that have to be knocked out in order to provide a potential new service because, when you came to see us last, in your very interesting evidence you were giving us the criteria for measuring success and they certainly included the size of the audience. Under questioning from our Chairman you indicated that trust was a very important measurement and you arrived at a comparison with on-line audiences as well. Let me just take two examples which I know reasonably well, the Czech Republic and Brazil. If the argument is that they do not have the same strategic importance, the first part of the question is, is that an FCO judgment or is it a BBC World Service judgment that they do not have strategic importance? Anybody who looked at the state of the Czech Republic and of Poland and Hungary—all of which I think are going to lose their native language services—you would have to say that first of all they have in the past been very dependent on and have much used the BBC World Service. In fact, I remember going to the Czech Republic immediately after the revolution and being told within a matter of a day by five or six people that the only thing that kept them sane was the BBC World Service during the communist years; yet it would be very facile to assume that the problems are all over and there are now well-established, functioning democracies working in every respect in those countries. In Poland, and in a different way in the Czech Republic, there are a lot of strains still about the settled future of those countries. Then if we could take Brazil, here is one of the most dynamic economies and societies in the world, a young country, where people do not on the whole have much English, unlike the countries of the former Soviet Union where now the young people are learning English, it is true. That is not largely the case in Brazil, however, it has an enormous population, a fast-growing economy with very considerable strains and stresses—in fact, the trust issue which you rate so highly, trust in all institutions in Brazil has fallen a lot. I guess what I am trying to press you on is in the process of advancing Arabic TV are we sure that we are not throwing out some quite important babies with the bathwater?

  Q842  Chairman: If I could wrap up a little bit of that too, really what we are trying to find out is what were the criteria used in deciding which were of the highest relative strategic importance with reference to those two countries?

  Mr Chapman: Let me explain the process by which we evaluated the 42 languages because I think that would make things pretty clear. There were three sets of criteria that we used when we reviewed the 42. First of all, there was what I call relative strategic importance, and you can do some of that by numerical indicators, you can make an amalgamation of population, GDP, strength of the economy, defence spend—there are indicators you could use in each of the country's cases to get a sense of where they sit relative to each other. On the issue of media freedom, which is also another very important criterion, if the BBC withdrew from these places where we broadcast in Czech or Portuguese, what would there be left over? What would people turn to, what would be the strength of the media there—indigenous, national and regional media—but also how far are people already turning to the BBC in English, either through BBC World Service radio or through television? The third area of assessment, if you like, was what was the current audience size and what was the prognosis for the future, was the prognosis good—i.e. it would at least hold its own, perhaps even increase its audience—or would the sheer strength of the competition mean that the audience would ebb away, and what was the trend already in that respect? Obviously, while in every country we do not do audience research every year, we do do audience research pretty regularly in these places and you can see a trend start to emerge. The two cases you cited, on the issue of the Czech Republic the Czech Republic would have scored relatively modestly on strategic importance—against, say, some of the major world countries it would have done modestly well—it would have scored not particularly well in terms of audience and in terms of freedom of information, because if you look at all the indicators about press freedom, the Czech Republic scores on a level not unadjacent to the United Kingdom, so it is hard to make that case—and I have visited myself and seen at first hand. The lack of media opportunity and choice that would have existed in the Cold War years, that is just not the case now: there are many news channels, there are commercial channels, there are State-run channels across television and radio, so it is hard to make out a case that actually the Czech Republic is impoverished in terms of its media opportunities for people to consume independent information. The third area in the case of the Czech Republic would have been size of audience. Actually, the size of the audience for the Czech Republic is not particularly bad, it is okay, it is steady, and obviously FM distribution there has helped. The Czech Republic therefore scores in the middle against quite a lot of criteria, but all these issues are relative of course because if you have a sum of money to invest in international broadcasting you have to make difficult choices and you are making a judgment about it all the time as to whether, in the end, you want to spend £1.5 million in the Czech Republic or whether you want to spend £1.5 million somewhere else, because in a fixed budget that is the reality of the position that broadcasters have to face up to. In the case of Portuguese for Brazil we have not closed down all the services to it. The interesting thing about Portuguese for Brazil and the Brazilian media market is that (a) it is a very, very fertile and rich media market now and there is a lot of choice. Again, I have been there and seen first-hand for myself. Secondly, as a result of that, the World Service audience in Portuguese is very modest indeed now, it is less than one per cent of population. However, the audience consuming the BBC's services on the Web, which is Web news and information, is going rather well, so there the outcome was no, let us not close the whole service, let us withdraw from radio except for short news bulletins which are parts that we broadcast on the web and therefore enable us to get an audience, but let us put more money into the web operation and let us move our staff and give them a decent set of premises in Sao Paulo where they can operate from. That was, in the two examples you gave me, how we came to the conclusions we did.

  Q843  Lord Holme of Cheltenham: If I may ask just one supplementary question on the strategic importance point, clearly by any reckoning Brazil is a country of major strategic importance, so the judgment was that if you can provide this on-line, that would meet the need.

  Mr Chapman: We talk a lot about audience need but there has to be in the end consumption for there to be audience need really, in my eyes. The problem we had with the Brazilian service was that it was not that it made bad programmes, it made perfectly good programmes, but the market just did not need them any more, there was too much other choice, people were not going to listen, and this was despite really good distribution for radio, so it was not that distribution was poor, it was just the fact that in the end the historical reasons that had driven people to listen to the BBC, at a time when there was far less choice and Brazil was going through periods of military rule and so on, those times are not there now, therefore people are not turning to it. In the end I cannot force them to turn to it, we have to be much more thoughtful about it and say in the end there is a better way of getting information to them, the web is the best way in this case. There audiences are going up so actually we are hitting the nail on the head if you like.

  Q844  Lord Holme of Cheltenham: When you said that the Czech Republic was not of strategic importance, is that your judgment or the FCO judgment?

  Mr Chapman: I think it is together because it is a relative thing. I am not saying that it does not have any strategic importance, what I am saying is that when you look across the world at the places where we broadcast in 42 languages it does not get anywhere near the top, it gets in the bottom seven or eight and therefore it starts to become vulnerable to a reprioritisation exercise, inevitably, if you have a limited amount of funds. In relation to the discussions with the FCO, what happened was we did all this work and actually we have, I think, really sophisticated thinking on this, which we then shared with them, and we said as a result of this we are going to propose to close a number of services, and under the Broadcast Agreement with the government, of any complexion, the Secretary of State has to give his or her permission for the opening and closing of services, and therefore Jack Straw had to either agree or not agree as the case may be, and he agreed that it was an appropriate thing to do, given the relevant needs of audiences around the world, given funding issues, given the need to start Arabic television. You are juggling a lot of different balls here and everything is relative here if you have a fixed budget.

  Chairman: In practice it is quite difficult for us to get our minds around exactly what role the FCO plays—I was coming back to the point myself—because you have editorial independence and so on, so that little bit of explanation certainly helps.

  Q845  Lord King of Bridgwater: Can I just clarify that point because in this case you said you took the initiative, you went to the Foreign Office and said "Do you mind if we do this?" On other occasions, for instance the decision to set up an Arabic television service, the Foreign Office are entitled to take the initiative, are they, and come to you and say we would like you to do it, and then you have to decide whether it is feasible for you.

  Mr Sambrook: It tends to work the other way. We take a strategic view of where we believe our services will be most effective, and we have on-going discussions with the Foreign Office through quarterly meetings and ministerial—

  Q846  Lord King of Bridgwater: I understand that. I am really on the point is it always that way round or can it be the other way round?

  Mr Sambrook: To my knowledge and in my experience it is always that way round because the thinking is primarily about broadcasting. I take the view we are best equipped to go to the FCO and say we understand the problems of the marketplace, right, and therefore we on balance think it is better to invest money here rather than here.

  Q847  Lord King of Bridgwater: Can I just clarify a fairly simple point? When we are actually talking about changing to English language, to what extent are the news broadcasts in whatever language it is an identical translation of what goes out on the English service, or are they different broadcasts?

  Mr Chapman: They are different, but given that our primary job is to explore an international news agenda, they definitely take guidance editorially from the World Service English Newsroom, and the World Service English Newsroom is the heart of Bush House and has tremendously high quality standards. The language services therefore take guidance, but they have to be able to turn that material and obviously gather their own material to make the programmes relative to their audiences, so it is a mixture. Sometimes an individual service will do a story which is relevant to that country, but other people across the World Service may not cover it at all, but there will be other major international issues where everybody would be covering it.

  Q848  Lord King of Bridgwater: Moving people to say we have an English service, more people are listening to that now, they will get different broadcasts.

  Mr Chapman: They will get some different broadcasts, yes. The core agenda will be similar but there will be definitely some aspects of regional and national politics or issues which they would not get covered.

  Q849  Chairman: Returning to the point about the FCO and their role in all this, are you really saying—as you have said pretty clearly—that they do not really play a major part, but presumably if they disapproved of what you were suggesting they might suggest a cut in the budget?

  Mr Sambrook: The broadcast agreement between the BBC and the FCO clearly states that no service in the World Service can be opened or closed without the agreement and authority of the Foreign Secretary; therefore, any reprioritisation or any change in the range and scope of our services has to be formally approved by the Foreign Secretary.

  Q850  Chairman: But not necessarily the details inside.

  Mr Sambrook: No.

  Mr Chapman: I characterise it like this: we have a conversation with them about the where and the how, i.e. the where in the world and the how, increasingly around now television, radio and new media. In the old days it would just have been a conversation about radio and that would have been it. The what, what is in the programmes, the editorial content, we have absolutely no conversations about that, that is about editorial independence, that is up to our journalists and editors to work out, particularly taking into account the needs of the audience. I would never have a conversation about an individual programme with the Foreign Office and say "Well, the Chinese service had better cover this story tomorrow", that is not a conversation that would ever happen.

  Chairman: Did you want to follow that up?

  Q851  Bishop of Manchester: My Lord Chairman, thank you, can I just follow your point about China? There was a debate yesterday in the House on the situation of refugees on the Burmese border, and one of the points that was being made in a speech was the increasing significance of Chinese foreign policy, and somebody did say that there was an increasing need for the kind of impartial broadcasting from the West which the BBC World Service is so renowned for. I wondered if you could just say in respect of the conversations about priorities and the kind of countries to which the BBC might broadcast, how far China has been in those conversations, and as, presumably, the opportunities increase in the years ahead, where would the funding be likely to come from in the medium to long term in order to be able to finance the BBC World Service broadcasting to China?

  Mr Chapman: The World Service already broadcasts in Mandarin extensively to China, mainly on news and current affairs, and it also broadcasts to China in English. Both services are delivered by shortwave. The difficulty we have in China—and we are investing quite a lot of money in this area, it is a very important service and there are no plans to cut it back—is that the Chinese authorities have systematically blocked availability to a Mandarin service on radio for many years and they also systematically block access to the BBC's pages of news coverage on the web, both in Mandarin and in English. I am in a position where we are making a rather good service, a very important one in every sense against the criteria we talked about earlier on—strategic importance, lack of free media access where China scores incredibly highly—but unfortunately the people there have a great deal of trouble in accessing it. We have raised this issue, ministers have raised this issue repeatedly with the Chinese authorities, but it is very, very difficult to make progress. They either deny there is a problem, or they say there is a technical problem, or they just do not do anything about it because there is a systematic blocking of these services going on.

  Q852  Bishop of Manchester: But if that blocking were to be removed then you have sufficient resources to be able to broadcast effectively.

  Mr Chapman: I have sufficient resources to broadcast effectively in radio and on the web in terms of a new media service of news and information, I have not got any resources to mount a service on television to the Chinese people. That would be a really significant investment, on a par with the Arabic investment, and if the Government wants us to do that sort of thing then they are going to have to pay for it because there is no way I can afford to pay for that.

  Q853  Baroness Bonham-Carter of Yarnbury: In China you only broadcast in Mandarin.

  Mr Chapman: Yes. We have one programme in Cantonese, for historical reasons, aimed at Hong Kong, but 95 per cent of the output is in Mandarin, yes.

  Q854  Baroness O'Neill of Bengarve: When you make a decision to put less money into radio in regional languages and more into new media, you are presumably also gaining audience in a different age group because it would be people who are used to the new technology, possibly using it at a place of work and so on. Have you done surveys to see, as it were, whom you have lost and whom you have gained in the audience as a result of that aspect of the shift?

  Mr Chapman: Not in the precise detail you are talking about. In some societies where we have invested more money in new media and retained our radio services we tend, you are right, to attract a different sort of audience, which tends to be younger, tends to be more professional and tends to access the new media from work rather than home, but not exclusively so. Our minimum position about audience, is that we want to reach out to decision-makers and opinion-formers, people who are actually going to influence, if you like, the future of that society, so we are definitely getting to a younger group of these people by new media investment. Obviously, we have withdrawn some funds from radio to do it, as in the Brazilian service, and there is a risk that some older listeners to the BBC's Portuguese service will no longer be able to access it. There is definitely a down side to that, but in the end this is the sort of juggling act that one has to do in making our priorities.

  Q855  Bishop of Manchester: Could we begin to focus now on the Arabic plans, and in your helpful letter of 25 October you talked quite a lot about that and referred to the audience research showing 80 to 90 per cent of those surveyed being likely to use BBC Arabic television. There are three areas that I would like to explore: first, the general objectives that you have in mind, and we have Al-Jazeera coming in tomorrow so it will be interesting to hear from them what they feel about it, and then I want to explore about the costs of the 12 hour and then look at what might be the possibilities over a 24 hour service. Could we begin, therefore, by just going a little bit more deeply into the objectives that you as BBC World Service have for a television service of the kind that you are anticipating? What are you really aiming to do?

  Mr Chapman: We are aiming to do a number of things. First of all, it is clear to me that if we are going to have impact in the broadest sense of the word, in the Middle East, with a BBC-funded, BBC-produced service, we need to be on the television; radio and new media alone will not do the job. Why? Because television has become the first medium of choice for news consumption in the Middle East, it is what people turn to first now, ahead of radio and everything else to get their news. So if we are not in it, overall and over time our impact is going to diminish relative to everybody else. It will diminish in a number of ways: it will diminish in the pure number of users, so our reach will go down, and if our reach goes down then our reputation will tend to follow behind it because if we have fewer people to listen it will be less salient, less important and people will give you less credit for it. In terms of the quality of the content, what people are telling us is that there may be more choice in the Middle East now—and Al-Jazeera is an example of that choice—but there is still a place for a television service which has the BBC values running through it, its accuracy, fairness, impartiality, covering a range of views, and there is a high ground, if you like, to be obtained and gained in this market. That is a very strong feeling that comes from the audience research, it is not just that people are likely to use it, they are likely to use it for those reasons, they see there is that gap and they want to use it, they want the BBC to do it. The reason why they want the BBC to do it is because the BBC has a long and distinguished history of broadcasting in Arabic, over 60 years, and they expect and have every right to expect that a television service would offer the same values, the same quality of content that they have grown up with on radio, and in new media in recent years. That is the background to the audience demand, if you like, for an Arabic television service and what we would expect to achieve from it.

  Mr Sambrook: One of the other crucial differences between the proposed BBC Arabic service and Al-Jazeera in Arabic is that Al-Jazeera and Al Arabiya and some other Arabic services are regional, they are reporting the Middle East to the Middle East. The proposed BBC service would be reporting the world to the Middle East, it will have that international perspective and international agenda, and I think that will differentiate it in that way.

  Q856  Lord King of Bridgwater: Done from London by satellite?

  Mr Sambrook: It is going to be partly done from London, but we will also be investing in our bureaux in the region as well, so there will be input from Cairo and other regions.

  Q857  Lord King of Bridgwater: But by satellite.

  Mr Sambrook: Yes.

  Q858  Bishop of Manchester: Coming to the funding then, you have already in your letter and in some of the earlier replies today talked about how closing down various things may release some funding. In terms of 12-hour broadcasting do you feel that that re-jigging of existing funding will be sufficient, or will you require grant-in-aid from the Government? If the latter, is that going to be a good deal for the United Kingdom taxpayer?

  Mr Chapman: To move from the 12 hour, which is what we are proposing at the moment, to be launched in 2007, to a full 24 hour service, would require an infusion of funds from the UK taxpayer. I think it would be a relatively modest amount of money in the overall scheme of things, we are talking about around £6 million extra to move from a 12 to 24 hour service because once you have got the infrastructure and you have got quite a lot of content already, it is not double the money, if you like, moving from 12 to 24 hours, you are doing a top-up in effect.

  Q859  Bishop of Manchester: Can I just clarify that because last time you said that moving to 24 hours would cost about £25 million, so therefore 12 hours is going to cost just £6 million less than that.

  Mr Chapman: Correct, 12 hours is costing £19 million and that is part of the £30 million investment plan, but to move from 12 to 24 hours needs extra investment from the Government, perhaps in a spending review settlement, perhaps outside it, but it would need that in order to move from 12 to 24 hours.

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