Broadcasting regulator Ofcom has published its first set of proposals designed to safeguard the future of public service broadcasting, with radical suggestions on providers and funding including top slicing the licence fee.
The Ofcom report is the first of two looking at ways to safeguard the future of public service broadcasting in the light of digital switchover due in 2012, the declining value of current funding to commercial broadcasters and the rise in number competing platforms for public service content like online.
Ofcom found that although the range of needs public service broadcasting seeks to address is expanding, the amount of what it called ‘implicit funding’for the commercial public service broadcasting was down by a quarter, around £130 million in real terms. Ofcom predicted this would be down £300 million by 2012.
Ofcom said that while the BBC had flexibility to evolve to changing audience requirements, commercial broadcasters did not and nor was there current funding for others who provide public service content.
It proposed four future models of funding. The first suggests that the current commercial public service broadcasters, Five, ITV and Channel 4 retain that role but but ‘evolve”, getting either more funding or have less public service responsibilities.
Under a second proposal, the BBC would get all the public service funding.
A third would allow funding for the BBC and Channel 4 with ITV and Five losing their PSB role. There would be limited competitive funding where the BBC and Channel Four were not providing public service content in an area. Last month Channel 4 put forward its case for public service funding, after it said it would be in deficit of £100m by 2012.
The final option opens up competitive funding to everyone, with the BBC retaining a core role in certain areas.
Proposed methods of future funding include direct public taxation, reallocating the licence fee funding currently ringfenced for digital switchover schemes, altering regulation to allow access to the broadcasting spectrum at below-market rates and giving public service broadcaster status to additional channels, or by introducing industry taxes similar to those currently proposed in France.
The BBC has already raised its opposition to the idea of top slicing the licence fee to allow other broadcasters access to public monies. The corporation is due to make its case to retain its special status over the next few months, beginning with a series of speeches by high profile talent like Sir David Attenborough and Stephen Fry on the future of public service broadcasting.
The National Union of Journalists has expressed concern that the idea of top slicing has tended to dominate the debate because the alternative models are technical and complex.
Ofcom found that the BBC is seen as the cornerstone of public service broadcasting but audiences have identified key areas they expect more than they currently receive currently from the five channels – particularly regional and children’s programming.
The five main channels still account for almost two thirds of television viewing but their overall audience share has fallen by 17 per cent since the last Ofcom review in 2003.
Ofcom said that decline was much greater among 16-24 year olds and ethnic minority groups, who turn to digital channels and the internet for public service content.
Ofcom said in the medium term between 2011 and 2014 regional services on ITV could become ‘increasingly unsustainable even at a reduced level”. Channel 4’s medium- to long-term commitment to current affairs, international news and factual programming would come under ‘significant pressure”. Commercial broadcasters would therefore need clarity about their long term roles by 2011.
Ofcom wants legislation in place by 2011, well before the expiry date of current commercial broadcasters licences in 2014. Channel 4, which has already set out its arguments for retaining its public service broadcaster status, has today called on Ofcom and the government to act even earlier to introduce legislation.
Ofcom has also called for submissions on ITV proposals to reduce its regional news services. It identified a need to retain plurality of provisions in Wales and Scotland
Phase two of the Ofcom review is due in the autumn will evaluate the four possible models and the issues around nations and regions provision, Channel 4 funding and potential intervention in interactive media.