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What now for the BBC?

16 Sep 2020  |  Raymond Snoddy 
What now for the BBC?

Ray Snoddy runs through the numbers published in the BBC’s Annual Report and what it means for the future of the public service broadcaster

The publication of the BBC Annual Report in an age of disclosure of the salaries of “stars” can only mean one thing – an instant row over huge pay cheques often linked to the number of licence fees consumed or comparisons with how much the Prime Minister is paid.

There is no doubt it is difficult to justify £1.36 million a year for Zoe Ball, a huge rise from her previous perch on Radio 1, even though she attracts more than eight million to her Radio 2 Breakfast show, a fall of one million from the previous incumbent Chris Evans.

Around £1.35 million a year for the next five years for Gary Lineker still seems steep, even though the presenter of Match of the Day has taken a pay-cut of £400,000 a year.

But another number leapt out of the pages of the BBC statistics - the fact that 237,000 fewer licence fees were in place in 2019-2020 than in the previous year.

For the Daily Mail this amounts to a “Great TV licence Turn-Off”, while The Times, which put the number at 250,000, wrote of the “collapse” of TV licence sales.

It’s a serious issue because the total compares with only 37,000 in the previous year, following years of growth.

The main reason is an increase of those not paying their licence fees, hardly surprising in the midst of a pandemic with hundreds of thousands losing their jobs and millions fearing they might soon follow. Some young people are also deciding, perfectly legitimately, that Netflix and YouTube is quite enough for them.

The lost licence fees equate to around £40 million a year, and takes much of the shine off the extra income generated by an inflation-linked licence fee.

The big question is what happens next? A really serious recession, arising from a second outbreak of Covid-19 with the main effects of Brexit yet to come, could put further serious pressure on BBC income.

More might simply refuse to pay, encouraged by a raucous campaign on Twitter to “defund the BBC” by refusing to pay the licence fee.

Newspapers such as the Daily Mail, the Sun and The Times are no doubt happy from their own motives to create anti-licence fee mood music by never missing an opportunity to suggest that the licence fee is entering its final years, if not days.

Here, the attitude of the government will be crucial, but alas it’s currently controlled by people who are no friends of a public service broadcaster such as the BBC.

Most of those currently in power are perfectly happy to see a much smaller BBC with a more tightly-drawn public service remit.

Broadcasting minister John Whittingdale has spent most of his political career arguing that the present scale of the BBC represents too great an interference with the operation of a free market in broadcasting.

Some MPs are running around saying that the BBC should be funded by advertising. So you want to destroy ITV and Channel 4 as well as the BBC?

A voluntary subscription just like Netflix is the answer for others. There is no quicker way to turn the BBC into a rump service like PBS in the U.S, a service which, in effect, only the middle-classes could afford to pay for. Fewer people paying equals either increased costs or a much-reduced service.

These are all very old arguments, but it’s as if a whole new generation of MPs have to be re-educated on what the purpose and benefits are of a public service broadcaster, funded by everyone and providing services to everyone.

It is far from clear that many of the current crop of Tories – the sort of people happy to vote for the UK being prepared to breech its international treaty obligations – are prepared to listen to arguments about the future of public service broadcasting.

The acid test may come very soon if, as many believe, the government decides to go ahead with decriminalising the licence fee, without any balancing compensation for the money likely to be lost as a result.

The BBC estimates that the move would cost the Corporation £1 billion over five years and the truth is nobody knows if it will stop there.

Will many more people than expected feel emboldened to use BBC services for free when it is impractical to deny non-payers access and impossible to chase millions of free riders through the civil courts.

This could easily turn into an existential threat to the BBC in its present form, even though - as former Cabinet minister Damien Green has pointed out – a Cummings inspired destruction of the BBC did not appear in the Conservative manifesto in December.

As for viewing and listening figures, the BBC is not doing so badly given the ever-increasing competition it faces.

More than 41 million people a day used BBC services last year - up to 90% a week with 94% tuning in during the height of the virus crisis in March. The iPlayer continued to break its own record with 4.8 billion requests to stream programmes in 2019-2020.

Naturally the Daily Mail puts a different spin on such numbers.

What a scandal, even among the BBC’s most loyal viewers, the over 55s, reach across all BBC channels has plummeted from 93%… ahem to 92%.

The fall of overall audience reach of BBC One was a little more serious at 65.4%, compared with 68% - but scarcely a collapse given the availability of everything from Netflix and Apple to Amazon Prime and YouTube.

There was also a bit of a blow for the BBC in research by Neil Thurman, professor of communications at the University of Munich.

As widely anticipated at the time, the decision to make BBC Three the world’s first broadcast channel to go online only had serious consequences.

Viewing fell by 89%, and even when you include hit series such as Killing Eve and Fleabag shown on BBC Two, the fall was still more than 70%.

BBC director general Tim Davie will somehow have to find the money to reverse the error and begin broadcasting BBC Three again.

Taking a closer look at the £144.7 million a year bill for top stars – a rise of £1.1 million on the year - might be a good place to start.

There is no shortage of emerging talent out there waiting to be given a chance – and most of them will be willing to do the job for less than £1.36 million.

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JohnBillett, Director, IDComms on 17 Sep 2020
“Always a challenge to take issue with the authoritative source Ray Snoddy, but here goes. Ray fails to make any reference to the commercial reality of cost control. The whole commercial ethos of the BBC defies all business mores. It has a virtually guaranteed income with hardly any requirement for cost control - until now. It’s time for the BBC to cut its costs significantly by removing unnecessary duplications and layers of expensive non productive costs and start delivering real value for money. It can then justify a reduced licence fee. Come on Ray. Get off your hobby horse and start thinking positively about cost reductions, just like the rest of us scrambling to stay afloat. Onwards John”