BBC License Fee Lives For Another Ten Years.
What Then?

Michael Hedges March 14, 2005

The Green Paper on the BBC’s Royal Charter recommends continuing the license fee for another 10 years but suggests an end in sight.

Europe’s public service broadcasters (PSBs) are mightily attached to funding their services through a compulsory license fee on radio and television devices. Most countries rely on such a tax, though there are exceptions, like Spain and, more recently, the Netherlands. PSBs prefer the license fee mechanism to traveling, hat in hand, to budget debates with politicians, often at inopportune moments. Independence from government or, sometimes, commercial influences is the keystone of a public service broadcasting replacing the well-remembered excesses of state broadcasting.

None of this was a problem when state broadcasting was State broadcasting. Independence from government was not an issue. The State was the provider and it provided, as it provided many other services, exactly what it wanted. Broadcasters – slowly - convinced governments – reluctantly – that independence was a good thing. And this new idea – public service broadcasting – could be funded off the State budgets, by a receiver tax, advertising or both. The broadcasters got what they wanted – insurance: budgets could be conceived more than a year or so in advance and no more telephone calls to news editors from politicians “suggesting” the correct “talking points.” Politicians got what they wanted – a new tax.  

None of this is a problem where state broadcasting is State broadcasting. Romanian President Traian Basescu ordered direct telephone lines cut between his office and state broadcaster Television Romania in February to keep the director, who he wanted to replace, “in his formaldehyde bottle.”

Commercial broadcasters – after a few years finding their own audiences and revenue streams – have turned on public broadcasters, coveting their audiences – and the resulting ad revenues. Commercial broadcasters make a case that they, also, provide “public service” content, for which they benefit not a twit from the license fees. Most countries require all broadcasters to allocate a certain amount of time each week to programming in the public interest, whether news, weather or traffic reports. 

The UKs Commercial Radio Companies Association (CRCA) has been most vocal in describing the problem commercial broadcasters have with the BBC. One salient complaint is that the BBC promotes its radio channels via its television channels, at levels and slots commercial stations cannot buy. CRCA announced last week a suggestion that commercial radio owners might work together develop quasi-national “destination programs” to compete with BBC channels which – in total -  attract 54% of the UK audience.

For the BBC, the Hutton inquiry into claims and counter-claims on and about news programs in the run up to the Iraq war was an inopportune moment.

The Department of Culture Green Paper, released March 3, offered the governments policy proposals after a year-long consultation. How the BBC will be governed and what it does are as much at issue as the license fee, made clear when Lord Hutton found the broadcaster out of step with the government’s view of its remit. Secretary Jowell said the recommendations will make for “A Strong BBC, Independent of Government,” the Green Paper’s title.

“The BBC must not be tempted to use the unique clout the license fee gives it to step on the toes of other broadcasters. It should not play copycat. Or chase ratings for ratings sake. Or put legitimate businesses at peril," wrote Ms Jowell.  Public broadcasters have long argued that their remit includes necessarily “popular” programming and that public interest and trust is jeopardized if they are remanded to a strictly public service “ghetto.”  Commercial broadcasters – the more vocal being Rupert Murdoch and Kelvin MacKenzie – want the BBC off their playground.

A White Paper will be released later this year, after more public consultation on the Green Paper, and will outline specific government policies regarding the BBC’s Royal Charter.

The Swiss Parliament recommended (March 10) spending more license fee money on private broadcasters as debate on the revised Radio and Television Law drew to a close. Swiss residents pay the highest radio and TV licensee fee in Europe, €292 per year. Public broadcaster SSR-SRG receives 96%, the rest – about €28 million – subsidizes needy private broadcasters. The new provision would raise the subsidy to €35 million.

In none of the Swiss debate was the possibility of dumping the license fee raised, although several Parliament members questioned SSR-SRG DG Armin Walpen’s Porsche, BWM and hotel expenses at media conferences. For its part, the Swiss public broadcaster said it would not ask for a license fee increase this year.  The high tariff is justified, said SSR-SRG deputy DG Daniel Eckmann in an February 26 interview with Berner Zeitung, because SSR-SRG “does not compete with Trubschachen or Bonaduz, but Berlin, Paris and Rome.”

 

 

Mass Transit in Bonaduz

The twists and turns of technology may have more to do with ending the license fee than all the best efforts of commercial competitors and political enemies.

Last April German PC owners, those without TV sets, started receiving bills for a license fee payable to the public broadcasters. From the first of this year the Swiss collecting agent for radio and TV license fees began to levy an additional tax on PC owners equipped with broadband connections and media players. The UK Culture Minister’s Green Paper suggests a tax on PCs is on the horizon as listening and viewing migrates to new devices.

Another funding model for the BBC was suggested in the Green Paper: subscriptions. The thought strikes terror in public broadcasting. But as an earlier government report revealed, in 2004 subscription revenue for media in the UK exceeded advertising, suggesting that consumers will pay for what they want. 

Responding to the Green Paper in a BBC On-line interview, National Union of Journalists general secretary Jeremy Dear said the license fee is “vitally important” to journalists to preserve their independence from both government influence and “commercial pressures that other broadcasters have.”