National Union of Journalists—written evidence (BFF0010)
House of Lords Communications and Digital Committee inquiry into BBC future funding
The National Union of Journalists is the voice for journalism and journalists in the UK and Ireland. It was founded in 1907 and has more than 30,000 members working in broadcasting, newspapers, news agencies, magazines, book publishing, public relations, photography, videography and digital media.
How will new technologies and consumer habits change the future broadcasting landscape?
- The NUJ agrees with the committee that the broadcasting landscape is changing rapidly — characterised by intense competition, rising production costs and changing viewing habits.
- The past decade has seen a huge switch in viewing and listening habits, as audiences have started to use “on demand” services to watch and listen to content, rather than simply consuming it in a linear way (watching programmes live as they are broadcast).
- The BBC has constantly been an innovator in supporting and developing new technology. Without its Research and Development operation, we would not have had teletext, digital TV and radio growth would likely have been much slower, as would the introduction of subtitles, high-definition TV and Nicam Stereo. Each of these projects saw considerable investment which have since benefitted other broadcasters.
- The BBC i-player is one of such innovations and BBC Sounds, for audio content, has proved another winner. The BBC is seeking to further develop i-Player by providing exclusive live events such as the Copa America football tournament and the Bellator MMA (mixed-martial-arts) events. Crucially, both platforms are free to air and do not require an additional subscription. Maintaining such universal services will be critical to ensure that all audiences can access a diverse and meaningful set of programmes. In particular, the BBC provides news, learning and regional content that the likes of Netflix do not. Furthermore, limiting quality drama and entertainment only to those who can afford subscriptions would marginalise the poorest in society.
- There will undoubtedly be a challenge as technology develops even further. Already, the BBC is faced with having to duplicate its core TV services on three digital platforms – Freeview, Sky and Virgin. Continued funding from the license fee will be critical to maintaining a universal service, accessible by the vast majority of the population.
- Any suggestion that a subscription model for the BBC would provide consumers with better value for money is false. As there are no conditional access systems on TVs, and not all homes pay for superfast broadband, it would not be possible to have a service that everyone could subscribe to until the 2030s – that would undermine one of the key tenets of public service broadcasting, universality.
- Critically, the BBC supports the vital infrastructure for free to air TV via aerials (Freeview) and, indeed, saved Freeview from possible collapse when digital TV was first developed. A similar position applies to radio, with the BBC helping to fund the upkeep and development of FM and DAB transmitters, which also benefits the commercial radio sector. Notably, the existing network of transmitter sites has allowed community radio and Local TV to utilise existing transmitter masts for their own operations.
- In hindsight the Competition Commission’s 2009 decision to block Project Kangaroo, a joint venture between ITV, Channel 4 and BBC Worldwide to collaborate and provide UK-originated TV content to the nascent UK video-on-demand market, was a big mistake. Kangeroo’s “successor”, Britbox, now has half a million subscribers in the UK, according to Carolyn McCall, ITV’s chief executive, and 1.7m outside the UK. It has been reported that there are moves for further collaboration between the PSBs on BVoD. The broadcasters have apparently discussed the development of a single free streaming app that would aggregate all their live broadcasts and on-demand programming in one place, accessible via a single sign-on. The Britbox subscriptions are dwarfed by those of the huge American corporations such as Netflix, Amazon Prime and Disney.
- Ofcom research (published August 2021) recorded that UK subscriptions to streaming services climbed by over 50 per cent last year to reach 31 million; this meant that by September 2020, three in every five UK homes were signed up, compared to 49 per cent a year earlier. More than half of UK households had taken out a Netflix subscription. Nearly half of UK adults now consider online video services to be their main way of watching TV and film with many people watching BBC productions such as The Line of Duty and Peaky Blinders on Netflix, possibly unaware of their provenance. In 2021, 50 per cent of adults said they had a smart speaker in their home.
- But when it comes to news, the top news sources across all platforms were BBC One, 62 per cent, ITV, 42 per cent and Facebook 36 per cent (Ofcom News consumption in the UK, 27 July 2021).
- Comparisons between the BBC and Netflix are specious – they are completely different beasts. Will Netflix still be here in 100 years? Most probably not. Clearly the BBC has to respond to the competition, but year-on-year cuts mean its income for UK services is already 30 per cent lower in real terms than it was 10 years ago. The National Audit Office (NAO) reported (December 2021) a 22 per cent increase in repeats on BBC 1, due to cuts and Covid and a 12 per cent real-terms reduction in BBC content spending between 2016-17 and 2020-21. The BBC made annual savings of 1bn with a forecast of £971m to be made in 2022. The NAO found that of the posts cut, 35 per cent had been frontline journalist roles. This presents a problem when competing against the huge budgets of competitors. It also provides the case for the BBC producing drama and programming focusing on themes and subjects closer to home. While the American companies make tremendous dramas, they are clearly rooted in American culture and values.
- In its fourth annual report of the BBC covering April 2020 to March 2021, Ofcom says: “The BBC offers the widest range of genres and invests heavily in the UK creative sector. This distinctive and original UK content is at the heart of how the BBC appeals to all audiences and meets its Mission and Public Purposes. As it pursues its strategy to focus on high-impact content, in the light of increasing competition for audiences and budgetary pressures, the BBC needs to maintain its commitment to original UK content.”
What is the purpose of a national broadcaster?
- The BBC is where UK citizens go to hear or watch news of national importance such as the declaration of wars, conflicts, coronations, and pandemics. It is where we come together to celebrate royal weddings, celebrations of the Queen’s platinum jubilee, the funeral of Princess Diana, general election results, Danny Boyles’ extravaganza showcasing the UK’s history and culture during the opening ceremony of the London Olympics and other flagship sporting events. Netflix may show the sumptuous The Crown drama, but it does not cover real-life coronations.
- On 1 October 1939 Winston Churchill gave his first broadcast on the recently created BBC Home Service. His later wartime speeches bolstered morale, with more than half the adult population tuning in with the nation coming to a virtual standstill. During the pandemic, the British public again flocked to the BBC to watch the Prime Minister and his scientific advisers as they explained the effects of the virus and the government’s response. The public service broadcasters all earned praise for their reporting of Covid-19 and providing trusted public information, but it was the BBC, among the UK's TV news providers, which ranked top at 78 per cent for providing the best news about Covid-19. Ofcom research [Understanding audience perceptions of the BBC during Covid-19] found that almost a third increased their use of BBC news since the start of the first lockdown, six in ten respondents felt that the BBC had done well in providing educational/learning programmes and two-thirds of adults rated the BBC highly for providing entertaining and engaging content. Across the week beginning 23 March 2020, more than 44 million people in the UK tuned into BBC TV Network News. Virtual church services were aired on Sunday mornings and religious reflections from various faiths were broadcast whilst places of worship were closed.
- “Many respondents felt the BBC’s heritage is in news, and that this is their core connection to the BBC brand. With heightened demand for up-to-date information and the regular occurrence of government briefings, a lot of respondents turned to the BBC as their ‘go-to’ source of news during the pandemic. When those who said they were using the BBC more since the pandemic were asked why, many cited the provision of trustworthy and reliable news as key factors,” said Ofcom in its report on the BBC and Covid.
- A national broadcaster can help us understand the world we live in, by providing engaging content which explains our history, society and the different cultures which make up UK society. A national broadcaster can be a cornerstone of a healthy democracy and a pluralist society.
- The BBC’s remit and public purposes include: sustaining citizenship and civil society; promoting education and learning; stimulating creativity and cultural excellence; representing the UK, its nations, regions and communities; and bringing the UK to the world and the world to the UK. That is why its universality must be safeguarded and why it needs to be sufficiently funded to carry out its remit. As a national broadcaster it has a role in improving social cohesion, with Ofcom saying that public service broadcasting should support a tolerant society through the availability of programmes which reflect the lives of different people and communities within the UK: “This will encourage a better understanding of different cultures and views and sometimes bring the nation together for shared experiences,” it said.
- BBC local radio plays a major role in representing regions and communities. Its 40 radio stations and regional television reflect life from communities across the UK. The lax regulation of the provision of local radio station news has led to its virtual demise in the commercial sector. In 2019, Global Radio replaced the 40-plus local breakfast shows across its Capital, Smooth and Heart networks with just three nationwide programmes hosted from London. Bauer has folded almost 50 regional radio outlets into a national network. Towns and cities across England have lost their own distinctive commercial local radio stations, now replaced with largely syndicated programmes made in London, hundreds of miles from the communities they serve. Local radio comes into its own during crises such as Covid-19 or floods when they provide literally a live-saving service for local communities. But local radio is also there for when the sun is shining, connecting people in their county or region; for many lonely people, local radio is their friend. Local radio offers MPs the opportunity to discuss local issues and publicly respond to constituents’ concerns. The latest round of cuts to BBC local radio has led to single presenters covering longer hours. The national BBC radio stations play a major role in informing the UK’s citizens about domestic and foreign politics and current affairs while showcasing culture, the arts and contemporary music.
- Launching the BBC’s nations and regions plan in March 2021, Tim Davie, BBC director general, said: “Our mission must be to deliver for the whole of the UK and ensure every household gets value from the BBC.” This plan includes shifting its creative and journalistic centre away from London over the next six years. He has announced plans to redistribute its spending around the UK, with at least an extra £700 million outside London by 2027/28.
- Ofcom found the BBC to be successful at bringing audiences together in large numbers, for instance through high-quality drama, news, and live events. The latest series of Line of Duty had record ratings; the final episode had an average audience of 16.4 million people. Live events such as the Euros 2020 and entertainment such as Strictly Come Dancing regularly bring viewers together for a shared experience, it said.
What principles and priorities should inform the choice of the BBC’s funding model? And how would any alternative funding models affect what the BBC can provide?
- As the BBC celebrates its 100th birthday, it increasingly needs a stable funding model and an end to the relentless cuts if it is to fulfil its remit as a public service broadcaster. The NUJ believes it must remain a universal service, adhering to its core values and free from political interference.
- Research from KPMG shows that every £1 of the BBC’s direct economic activity generates a total of £2.63 in the economy; and 50 per cent of the BBC’s economic impact is outside London, compared to a sector average of 20 per cent. In 2019, the DCMS estimated that the creative industries contributed £115.9 billion to the UK, accounting for 5.9 per cent of its economy. We need to have a BBC which challenges, takes risks and continues to act as a driver to this vital sector of the economy.
- All democracies require balanced, impartial news coverage which do not depend on the personal prejudices and foibles of media moguls, commercial pressure to appease shareholders or government interference. Any funding model must therefore protect the BBC from editorial interference and maintain its independence.
- Bold assertions about the end of the licence fee model ignore the reality that extensive studies have not yielded a better model. However, regardless of how the BBC is funded, and alternative models exist, the key issue is to preserve the principle of universality that underpins our public service broadcaster. A subscription service in no way achieves that. Those Reithian principles of informing, educating and entertaining are as important today as they have ever been. To undermine that would be an act of cultural vandalism and the NUJ hopes the public will rally to support the BBC and understand its unarguable value to our society.
How should the BBC change over the next five years to adapt to evolving consumer habits and needs - and what does the corporation need to do to prepare for the future in the longer term?
- A major task for the BBC is to reach out to young people and make itself relevant. While more than half of ten-year-olds have their own smartphone, almost all 15-year-olds have one, giving them access to content on YouTube and Netflix and to their friends via WhatsApp, Snapchat, Instagram and TikTok. While the BBC cannot blindly follow the latest trends and fads determining which platform or app is popular with young people, it must play to its strength, providing content they want to watch. It needs to look at ways to transform the CBeebies into the TeenBeebies.
- Moving BBC Three from digital to terrestrial was a step in the right direction. The channel has always targeted 16 to 24 years olds and was the home of hit shows like Normal People, Fleabag and Killing Eve. There needs to be more joined up thinking between traditional platforms and new media. New media can drive viewers towards traditional TV and vice versa.
- The BBC must continue its policies and meet its own targets to increase diversity in its workforce so its programming and the news stories it selects reflects UK society which is becoming increasingly diverse and will continue to be so. Large parts of the UK don’t feel the BBC is relevant to them. More is being done to rectify this and local radio in particular has started to attract listeners from social and economic backgrounds that had started to drift away from the BBC. But a diverse workforce needs to be more than just about skin colour or ethnicity.
- The BBC must continue to travel in the direction of offering content on demand and develop new formats, such as 360 filming and Virtual Reality, to make news reporting exciting and immersive. BBC Sounds and the iPlayer have both been a success and have helped retain and attract some of the younger audience, but the BBC was late to realise this was the direction of travel. It needs to be ahead of the curve in whatever may come next. It's also lagging behind in allowing viewers access to its archive material. Sky for example has a vast amount of its back catalogue and boxsets easily accessible. The BBC’s back catalogue is vast in comparison yet very little of it is easily available. It needs to tap into that vast back catalogue and make it readily available.
- The BBC must continue to be able to provide first-run original UK programming. To do this it has to invest and attract the best writers, directors and actors. It has had some notable successes with Fleabag, Norman People, In the Line of Duty and Peaky Blinders. It must be prepared to take risks with all areas of output from dramas to documentaries. It must also be willing to give the next generation of talent opportunities and showcase up and coming talent in all areas of output both on screen and behind the camera.
What actions and consultations are needed from the government to inform its future BBC funding plans?
- It is vital that the public are consulted on any future funding plans for the BBC. They must not feel that whatever replaces the licence fee is another tax imposed on them. It is important they are made aware of what services they are paying for and what good value the current fee is. Any replacement needs rebranding. It is still known as the TV licence despite it providing so much more than that – radio, online, iPlayer, BBC Sounds, the Proms, BBC education and so much more. Even a 5 per cent rise in the price of the current licence fee would only translate as an extra £7.95 a year, or an extra 63p per month. When this is compared to the other TV packages it is clearly a bargain. More must be done to convince the public that the BBC belongs to them and that they have a stake in how it is run and the decisions it takes. One possibility is public representation on the board.
- The government could play a greater role in supporting the BBC. The BBC is a huge global brand, and many countries are envious of the services it provides. Throughout the world the BBC is seen as a benchmark of quality and integrity; in 2020/21 489m people tuned into the BBC every week. The World Service is seen as an essential part of the UK’s soft power, but more importantly in a world increasingly dominated by despots, its reports continue to shine a light in parts of the world where a free press does not exist. Its language services now reach 313 million adults weekly. This is of huge benefit to the UK and is something the NUJ believes should be funded directly by government, rather than by licence fee payers.
- The government is often highly critical of the BBC and in recent times let it be known (through a briefing by former adviser Dominic Cummings) that the BBC was going to be “whacked” and would lose its TV licence. The present Culture Secretary Nadine Dorries said in an interview in Sunday Times magazine: “There is a problem with groupthink at the BBC, and I don’t think those people think they are left or they are right. I think they just believe they are absolutely right about everything. And they have a world view and a view of the UK, which is, I think, sometimes very wrong.” It was her decision to freeze the licence for two years at £159 until 2024, after which it will rise in line with inflation for four years. Tim Davie, BBC director general, said this would leave the corporation with a funding gap of £285m by 2027. She did however row back on a Tweet which suggested it would be the “last” TV licence settlement. The NUJ believes the BBC’s detractors must be careful what they wish for. A pared-down BBC would leave the UK less informed and culturally impoverished.
- Many of the BBC’s most popular programmes are made by independent production companies. The abolition of or a smaller BBC could see many of those companies go out of business and lead to jobs being lost. Those companies, big and small need to be part of any consultation. The pandemic illustrated what a vital role the BBC plays in helping to educate, entertain and inform children. It was a life saver for many parents stuck at home during the lockdown. Teachers, head teachers and teaching unions should be consulted about the role the BBC can play in education.
- It is important that future funding plans are not able to be influenced by the government of the day. There must be an agreed formula going forward. Any new funding mechanism must guarantee the BBC a rising income and should not require periodic settlements. The present system has allowed the licence fee pot to be used as a piggy bank for successive governments to fund projects such as roll out of broadband and the ill-fated Local TV initiative.
- Any new funding formula should be progressive, whereby you pay more depending on what you can afford. This could be based on income or something like a fixed percentage of your annual council tax bill could go to the BBC. Research should look at the cost implications of providing free licence fees for the poorest households. This would contrast sharply with the cost of Sky, Amazon or Netflix which does not provide any discounts for those on low incomes.
- Any replacement funding mechanism must be cheap to collect. One of the reasons why the licence fee has continued for so long is that it is relatively easy to administer and costs ‘only’ £119m a year to collect.
- The government needs to ensure that sections of the population are not left behind when new technology is introduced or would become required to have access to TV. Research in the Office for National Statistics paper Exploring the UK’s digital divide found that in 2018 there were still 5.3 million adults in the UK, or 10 per cent of the adult UK population were described as “internet non-users” as they had never used the internet or not used it in the past three months. The same paper found that across all age groups, disabled adults make up a large proportion of adult internet non-users. Many parts of the UK, particularly rural areas, have patchy or no broadband.