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Tenth Anniversary Lecture contributed by World Affairs Group, chaired by Geoffrey Catchpole
John Clark, Board Member of ‘Voice of the Listener and Viewer Ltd’ (VLV) on
29 October 2003
The speaker is a retired businessman (whose business was unconnected with broadcasting), who is Chairman of a VLV committee. He is involved because he believes that broadcasting can enrich our lives and stimulate our curiosity through ‘educating, informing and entertaining’. He believes that the ‘estimable BBC World Service is Britain’s best ambassador’, as he has observed at first-hand in many developing countries.
He warned that ‘‘Broadcasting is in danger of narrowing its scope, as it gives way to an increasingly competitive environment. Science and literature are being squeezed to the margins. New communication technologies, instead of expanding horizons, increasingly deflect content to the popular, the "reality", the celebrity-based programme seeking sensation’’.
VLV began in 1984 when Radio 4 was likely to become just a news service, successfully campaigning against that. Since then its activities have widened to encompass television and newer broadcasting services, seeking to safeguard the ‘‘quality, diversity and the independence of broadcast programmes’’. It has responded to all-important consultations since 1984 and has become an essential reference point ‘for all major bodies involved in broadcasting’. By request it has become involved in Europe and the World Trade Organisation, ‘which undermines the concept of public service broadcasting under the umbrella of free trade’. VLV seeks to ‘raise awareness of the critical role that broadcasting plays in shaping national and community life and structure’.
After the BBC had pioneered public service broadcasting, reputedly protecting ‘integrity, creativity and diversity’, a commercial network was set up to provide an essential competitive element. ITV, with a base of shareholders, was supported by advertising but had many franchises. Later, Channel 4 was added as a not-for-profit organisation and had a clearly defined public service remit. The Independent Broadcasting Authority (IBA) regulates commercial channels through prior approvals for diversity and plurality.
Satellite and digital possibilities brought changes. Rupert Murdoch soon achieved control of UK satellite services, free of regulation beyond licences. The 1990 Communications Act opened the door for BSkyB with its mix of sport and film and run by a media tycoon who owns two UK newspapers that influence UK politics. Now, research shows that the Internet, with its potential for transmission, content variety and interactivity, has achieved more viewers than television.
The Communications Act of 1990 threatened public service broadcasting by undermining the regional structure of ITV; subsequently in 1996 Channel 5 was introduced with a loose public service remit. The IBA was replaced by twobodies – the BBC Board of Governors and the Independent Television Commission (ITC) for commercial television. The Acts permitted the former ITV franchises, which had guaranteed plurality of ownership and regionality, to be condensed into two companies. While regulation was still considered desirable, popularity was becoming a dominant factor. When new technology gave more opportunity for choice, the Treasury sought income from the auction of territorial digital services. and deregulation was urged. Meanwhile, the ITV franchises had been reduced to two companies – Carlton and Granada.
Against this background a new Communications Act was proposed. The draft Bill sought a competitive environment, with self-regulation and some public service obligations. A parliamentary review committee, headed by Lord Putnam, made many amendments acceptable to government, but only a VLV campaign through the House of Lords secured a public service commitment which equalled that of securing competition. Models of the Financial Services Authority (FSA) and the Broadcasting Complaints Commission were proposed for ‘Ofcom’ by those supporting self-regulation, but these are regarded by VLV as unreliable, since post-facto regulation has never been effective.
The biggest problem, however, concerns ownership. Hitherto, cross-media and foreign ownership (outside Europe) has not been permitted, but a government policy advisor proposed thatthese should be allowed, to stimulate innovation and new investment, after the fiasco of ITV with respect to digital services. This will allow any foreign owner to buy ITV and Channel 5 and the VTV argued that while US ownership would thus be permitted, the US does not allow foreign ownership of its services. Moreover, popularisation rather than public service would dominate, and investment would, in fact, be minimal.. Cross-bench peers argued strongly but unsuccessfully against foreign ownership.. The merger of Carlton and Granada was favoured on cost-cutting grounds. As
Independent Television News (ITN) could now be bought by ITV, that too might come under foreign ownership.
In July 2003, the Act was passed with little public concern while other news dominated. Neither the Press nor the BBC publicised the ownership issue. An Office of Communications (Ofcom) was set up to cover telecommunications, commercial radio and television, spectrum regulation and broadcasting standards, but not the Internet (thought too difficult to regulate). The BBC Board of Governors wasto be involved only with general complaints and the approval of new channels.
The BBC had been allowed to increase the licence fee over five years in order to pay for digital transmissions, on condition that savings and sales were also made, which were achieved. VLV is critical of the incursions into commercial areas, which has resulted in the pursuit of ratings and marginalisation of public service broadcasts, although it recognises the success of BBC online services. The commercial sector wants the BBC to confine its activities to areas where commercial services fail and the BBC now has to defend its claims for licence fees when its commercial earnings are increasing. The public concern after the Hutton Inquiry may reflect on BBC impartiality and objectivity, which would have both national and international implications. The BBC Charter is due for renewal in 2006, so before that the issue of whether the BBC Governors or Ofcom should regulate the BBC will be much debated.
Considerable trivialisation is now evident in BBC programmes. The speaker believes that it follows, rather than leads, the ‘youth market’ and he claims that ‘programmes are now determined by focus groups rather than by creativity and imagination’. Further, the education services are now placed under entertainment services, as are science and arts programmes. Since the BBC sets the pace in programme making, the whole industry is affected. Under ‘BBC World’ there is an American network called ‘BBC America’ that carries advertising and its publishing arm exploits BBC programmes. The Conservative Party wants ‘BBC World’ to be sold, but the VLV would rather that the BBC confined its commercial activities to broadcasting. The commercial sector envies the very successful BBC online services now, which the speaker believes are ‘informational, educational and entertaining’, as they should be.
Turning to the central issue of regulation, the speaker agreed that Ofcom seems a logical development, but pointed out that it is responsible to the Secretary of State, whereas the BBC is responsible to Parliament. Ofcom’s ‘Content Board’ has independent people and leading industry figures and VLV’s discussions with it so far look promising, but these are early days. It maytake t five years for Ofcom’s value to be assessed.. The VLV wants the new Charter to contain a clear statement of regulatory responsibility, but resists the suggestion that the BBC be subject to Ofcom at such an early stage. The BBC receives£2.2 billions from the licence fee, while Sky gets over £3 billions from subscribers. Commercial broadcaster’s claims need careful scrutiny also, since there is little innovation and there are many repeats, often of former BBC or ITV programmes. Sky News attracts only 3% of the news audience. So although the Gilligan affair and the licence fee will get much attention over the next two or three years, judgements need to be objective and balanced. In the view of VLV, the licence fee should remain.
The speaker concluded by reviewing what he had not covered in his talk. Radio listening, particularly by the over-thirties, is increasing. There are considerable developments possible through the growing use of mobile phone, cable and broadband services and the conversion of all television users to digital broadcasts by 2010 involves at least the 90 million television sets currently in use. The personal video-recorder permits the omission of advertising and the time-shifting of programme watching. All of these technological developments and the issues discussed have significant social implications not covered by the talk. Research shows an increasing desire for interactivity and one suggestion that this reflects a turning away from community gives food for thought. Broadcasting should not be seen simply as a commodity, since most people in Britain are influenced by it. The principles underlying public service broadcasting should be observed.
Questions raised in the following discussion drew a variety of answers from the speaker. Commercial broadcasters’ concerns about the risks involved in starting an online service allowed the BBC to secure government funding (now nearly £90 millions), for online activities on which the VLV is being consulted. Public consultations on the various aspects of the Act and Charter renewal may be limited to online responses, since that form is now common, but the situation is unclear. There are, however, various formal ongoing consultations involving the BBC and two government departments with respect to the Act and the new Charter. Because parliamentarians are strongly influenced by the Press, there are doubts about democratic accountability, but that is the system and it must be used, although in practice the more disinterested Lords offer the more objective debates. Ministerial support for foreign ownership ignores the likelihood of American owners re-importing UK-made programmes, thus escaping the 50% prohibition of US imports.This will result in the supply of US-style programmes only, which will increase revenue abroad, rather than new investment in the UK.. Radio is also under similar threat from the Act. Whether the Content Board of Ofcom will be able to preserve public service broadcasting is in question, since its executive essentially reflects competitive phone service interests, and it is ultimately responsible to the Ofcom Board.