The writing on the wall

07 Nov 2018  |  Raymond Snoddy 
The writing on the wall

Ofcom’s block on BBC iPlayer box-sets is a time-consuming distraction that once again ignores the real threat of Netflix, Amazon and Apple, writes Raymond Snoddy

Sometimes small decisions can generate alarming echoes.

You would think that one of the BBC’s more innovative efforts - the iPlayer - was on the whole a good thing and part of any chance the UK’s public service broadcasters have of retaining position and impact in the world of Netflix.

The background numbers are frightening. Netflix is estimated to have more than 10 million subscribers in the UK from a standing start in 2012. Already young people spend more time watching Netflix than BBC programmes, including the iPlayer catch-up service.

Given the scale of the challenge it would seem uncontroversial, in an age of streaming, box sets and binge viewing that the BBC should be able to package some more of its drama series and other programming in the form of box sets.

A modest change surely, a bit more of what the BBC does already and the BBC board decided it did not amount to a material change and therefore not one subject to the delay of a public interest test and with it the possibility that the plan would be blocked.

Ofcom, the communications regulator, did not agree and has decided that the change is indeed material and therefore one requiring the BBC board to carry out the public interest test.

Ofcom said there was a risk that “this increase in viewing to BBC iPlayer could come at the expense of its competitors - particularly other UK video-on-demand services such as ITV Hub, All 4, My5 and NowTV.”

You can be certain that all aforementioned services will scream foul as if their lives depended on it and try to block any extension of the iPlayer.

Ofcom has almost encouraged them to do so.

Yes of course the BBC is trying to increase the audience to the iPlayer. It tends to be what broadcasters do. Not too many deliberately set out to diminish their audiences or hold them exactly where they currently are - something that is anyway impossible in the present hyper-competitive environment.

When is material, material, and how can such a thing be quantified?

Ofcom is just doing its job and is more likely to be criticised for not regulating the BBC half enough than for going too far.

There are still unfortunate echoes from the past.

The communications regulator seems to be dipping into the small change of competition here. No video-on-demand service is going to be brought to its knees by a few more box-sets on BBC iPlayer.

The more penetrating echo is the way the question, and market, is being framed - entirely in the UK context with the possible sufferers defined as the other British public service broadcasters with no mention of Netflix, Amazon or Apple.

Wherever communications regulators meet, two words should be painted on the wall - Project Kangaroo.

The very young may need to be reminded how the UK’s regulatory finest, the Office of Fair Trading and the Competition Commission, killed off a decade ago an innovative plan by ITV, Channel 4 and BBC Worldwide to launch a joint online service.

Who knows what it might have achieved if not for the words of the then chairman of the then Commission, Peter Freeman, that the service "has to be stopped."

The terrible danger was that it might have undermined future competition from other services which did not at the time exist.

By comparison the BBC and its box-sets and when is material material seems like pretty small beer. It is however a time-consuming distraction that carries the threat that the true competitive threat, while being happily acknowledged, is actually being ignored. It also, in effect, puts public service broadcasters at each others’ throats at a time when even Ofcom has been extolling the virtue and necessity of collaboration.

On public platforms Ofcom accepts that since the Kangaroo fiasco “market dynamics” have changed significantly and that the competition framework would have to be taken into account should any future similar project come forward.

The real mystery is not how Ofcom takes its decisions or how it might address a new Project Kangaroo but why no such project has so far been advanced.

Every now and again there is talk of such a thing and references to meetings and then there is silence.

With more UK subscriptions to Netflix, Amazon and NowTV than to traditional pay TV services there is surely a greater need than ever for the UK’s public service broadcasters to get together rather than pursuing their separate interests.

There is Britbox, the collaboration between BBC Studios and ITV in the US and Canada, but surely the international competitive context demands something grander and more inclusive.

If the BBC, ITV, Channel 4 and Channel 5 were able to get together to launch a combined streaming service then it might, just might, have the clout to at least be noticed in a world market that will increasingly be dominated not just by Netflix, Apple and Amazon but by expanding traditional players such as Disney.

The danger is that the UK’s public service broadcasters have such different interests and cultures that an agreement will be difficult.

Channel 4 may want to do its own thing and Viacom may have bigger fish to fry than worry about a Channel 5 co-operation with other domestic UK broadcasters.

Let’s hope they have all entered the tunnel where all border disputes and demarcations are resolved and that they manage to pull off a deal.

The time is late and the odds are against such a deal ever being pulled off but if it is, it will be interesting to see whether Ofcom has learned the lesson of Kangaroo instead of fixating on the harm such a collaboration could do to imaginary others.

As the great box-set public interest test wends its way through the system, Ofcom and everyone else should remember Lord Tony Hall’s warning at the RTS London conference in September - that the UK’s media industry was having to compete against global giants with one hand tied behind it’s back.

“In so many ways - prominence, competition rules, advertising, taxation, content regulation, terms of trade, production quotas - one set of rules applies to UK companies and barely any apply to the new giants. That needs rebalancing,” said Lord Hall.

For some reason he did not mention box-sets.

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NickDrew, CEO, Fuse Insights on 8 Nov 2018
“What's truly frustrating about this debacle is the extent to which the BBC is hamstrung by Ofcom. Box sets have been offered for years by Channel 4 through All4, but when the BBC attempts the same thing, there's suddenly a focus on "oh, but is it fair?". The viewer's preferences are, of course, left by the wayside in this hand-wringing - being able to watch the first couple of episodes of Bodyguard because one had only come to it late is regarded as not in the public interest, it seems. At the same time, Bodyguard is just the latest BBC series now available on Netflix*.
On a related note, the recent Radio Times analysis about the Radio 2 upheaval makes for interesting reading. The BBC made mistakes throughout, but it's apparent how much it ties itself in knots trying to abide by every missive handed down from Ofcom.

*-in some markets, at least. I'd be curious to know what the rules are about BBC exclusivity periods in the UK.”

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