DMB0045

Written evidence submitted by TalkTalk

This is TalkTalk Limited’s submission to the House of Commons Culture, Media and Sport Select Committee’s pre-legislative scrutiny inquiry into the draft Media Bill.

TalkTalk recognises the fundamental role that British Public Service Broadcasting eco-system, and the wider media industry, plays in our nation’s life. We support the government’s aim of updating the rules surrounding how the British public – our customers – access trusted news, and entertainment that reflects the diversity and strength of our country, nations and regions – and we support the empowerment of PSB prominence in the bill.

As an internet infrastructure company, much of the content that this legislation seeks to regulate is delivered through our connections, and will increasingly do so, as the future of Internet Protocol television (IPTV) beckons.

To be successful, we believe that it is key that the Media Bill recognise and protect the successful partnerships between the organisations producing content, including public service broadcasters (PSBs) and radio stations, and the organisations ensuring that content reaches its audience, such as internet service providers (ISPs), television selection services (TSSs) and radio selection services (RSSs). We believe that the Bill does so but should be more explicit in facilitating the sharing of PSB and internet radio content with the relevant services who will now be obliged to give them prominence, in a way that promotes innovative development of customer facing experiences.

For the PSBs to truly benefit from prominence, it needs to be delivered at scale. Scale is driven by innovation in user experience and physical product, as well as access to great content, and these elements all must work together to give the best possible experience.  Therefore, for PSBs to truly benefit from prominence, the regulatory framework cannot restrict innovation, and must allow TSSs to continue to deliver experiences that customers will want to choose.

On a wider level, we would also like to draw to the attention of the Committee issues within the internet infrastructure ecosystem, including a lag in take-up of full fibre to the premises (FTTP), that we believe may hinder the successful achievement of this bill’s prime objective: guaranteeing that audiences can continue to access high-quality PSB and radio content, in an increasingly online nation. The already growing remit of Ofcom as a content and infrastructure regulator – soon to be expanded to cover online safety - should also be borne in mind.

Public Service Broadcasting

Are proposals allowing a Public Service Broadcaster to meet its remit by online programming as well as linear appropriate?

Since 2012, TalkTalk has worked directly with the PSBs. We co-founded YouView, along with BT Group, Arqiva, the BBC, ITV, Channel 4 and Channel 5, to provide access to free-to-air digital terrestrial television (DTT), as well as TVon demand and IP-distributed linear channels through broadband internet connections.

Ofcom’s 2022 Media Nations report outlined how, whilst overall broadcast TV viewing had declined from 61% in 2020 to 59% in 2021, broadcasting video-on-demand consumption has grown, increasing by an average of three minutes per person per day compared to 2020. This is a trend that we have clearly observed through our work with YouView, and in our own consumer’s behaviour patterns.
 

We therefore strongly support the ability of the broadcasters to meet their PSB remit through online programming as well as linear programming, as a necessary reflection of changing consumer behaviour.

Video-on-Demand

Do the proposals in the draft Media Bill create any risks to UK’s desirability as a market for VoD content?

Our TalkTalk TV customers expect easy discovery and access to streaming video-on-demand services, just as much as to PSB video-on-demand services. The bill should make sure that it enables TSSs to deliver a customer-centric experience, including allowing for personalisation, in a way that is balanced alongside, and not impeded by, PSB prominence. If the balance is not right, then the commercial impact will fall on the TSSs who will struggle to agree viable commercial terms with subscription VOD providers.

Radio

Are the obligations on radio selection services proportionate?

Radio programmes are broadcast as audio-only TV channels, and as such TalkTalk TV makes these radio programmes available to our customers. For internet radio programmes to truly benefit from prominence, the regulatory framework cannot restrict innovation, and must allow radio selection services to continue to deliver experiences that customers will want to choose.

General issues

Is Ofcom able to deliver its new and updated obligations set out in the draft bill?

In addition to the new responsibilities proposed in the draft Media Bill, Ofcom is gaining new powers to regulate user-to-user services and search engines under the Online Safety Bill, and we are concerned that the increasing focus of the regulator towards content regulation and the systems and processes of content presentation, may prevent agile, flexible, and consumer-oriented regulation of the vital telecommunications infrastructure which carries said content.

Given the significant new responsibilities that Ofcom will acquire under the draft Media Bill, we would welcome the Committee giving serious consideration to the future of Ofcom as one regulator and assessing the options of separating content from infrastructure regulation into two separate bodies.

Is the draft bill flexible enough to address future developments in audience habits and new technology?

The next major change in television infrastructure will be the eventual switch from digital terrestrial television (DTT) towards internet protocol television (IPTV): instead of TV being transmitted by aerial, it will all be transmitted over internet broadband.

TalkTalk stands ready to facilitate this transition, although when the time comes any scenario will have to be based on different internet service providers’ abilities to plan for the necessary increase in peak network capacity.

For this reason, we would call on the final Bill to recognise the need for internet service providers to retain the ability to innovate with transmission technologies to cost-effectively carry PSB content at high quality to their customers, and that technological preferences would not be mandated in return for content provision.

Does the draft Bill provide sufficient protection for those without internet access or who prefer to use broadcast services?

Our experience in the field of internet connectivity supports concerns that, despite having access to new connectivity technologies, consumers do not always choose to take them up if they are not aware of the benefits. For example, a recent report we commissioned from Frontier Economics showed that, by 2030 (the government’s target-date for 100% full-fibre roll-out), as many as 33% of people who have access will not have taken it up for four main reasons:

1)      Reward: migration does not create a ‘feel good factor’;

2)      Loss aversion: consumers risk avoiding what they have;

3)      Ease: customers avoid thinking about migration;

4)      Social proof: consumers don’t see others migrating

One of the clear societal benefits of full-fibre take-up will be the ability of PSBs to transition from broadcast to benefit from internet enabled distribution.

As explained above, the prospect of an imminent transition to internet protocol television makes full fibre adoption – and a clear understanding of its benefits across society to ensure that adoption – even more important. We are therefore calling on the government to commit to a programme of activity focussing on full fibre adoption in the same way it has for rollout, including a cross-government taskforce, adoption targets and a public information campaign to reassure and convince people to sign up to gigabit-capable connectivity, including full-fibre.

The learnings from the rollout and adoption of Fibre to the Cabinet are also important to remember. Even once FTTC technology was available nationwide, adoption was very slow, so it was necessary to introduce interventionist measures such as vouchers and forced migration. We should learn the lessons from this transition to avoid a repeat in the case of FTTP.

Are there any issues missing from the draft Bill within the scope of public service broadcasting, video-on-demand or radio?

To date the key constituents of the broadcast industry (e.g.: broadcasters, content platforms, device manufacturers, ISPs) have benefitted from the open co-development of technical standards underpinning the delivery of PSB content and metadata to customers (as encapsulated in the DTG Dbook). While recognising that the shift to internet delivered services changes much of the underpinning technology, we would ask that the Media Bill ensure that the specification of such technologies continues to be open to the co-development of all constituents affected by the Bill for the benefit of the UK Media industry (in this regard we note the work of members of DVB and HbbTV in specifying and implementing DVB-I across European nations). This is an important aspect of promoting innovation, allowing the focus of our investment as a UK TSS to be in customer experiences that build upon the uniqueness of the UK industry rather than in localised modifications of technology otherwise commoditised at the global level.

Do you have any recommendations for additional or amended drafting to the draft Bill?

As outlined above, TalkTalk respectfully suggests that the Select Committee consider amendments to the Media Bill that seek to meet the following objectives:

• For PSBs, as well as internet radio services, to truly benefit from prominence, the regulatory framework cannot restrict technical or customer-experience innovation that drives the scale for that prominence and must allow both television and radio selection services to continue to deliver experiences that customers will want to choose.
• Fairly reflecting the reality, that whilst it is right that PSBs obtain prominence in the UK’s fast developing digital content environment, there is a clear expectation from consumers that they can easily discover and access a range of streaming service content via a discovery interface that reflects their evolving usage patterns and expectations. We would therefore welcome a clarification that the prominence provisions for PSBs will not prevent TSSs ability to innovate around content presentation, nor technical distribution technologies, in order to deliver a compelling TV customer experience that also delivers commercial value.

As well as, on a wider level, encouraging the government to better support the imminent transition towards IPTV:

• By setting industry targets and leading a public information campaign on the benefits of full-fibre take-up.
• By encouraging industry to adopt standards that guarantee free and fair access to internet protocol television metadata and streams, facilitating the work of ISPs to ensure that PSB content can be transmitted without hindrance.

Should the Committee wish to invite us to give oral evidence to expand on these points, we would be happy to do so.