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16|08|07

Ofcom begins Market Impact Assessment of the BBC's proposed Gaelic Digital Service

Ofcom has today published the Terms of Reference for its Market Impact Assessment (MIA) of the proposed Gaelic Digital Service and is seeking input from stakeholders on the likely impact to any relevant commercial products and services.

The BBC is proposing to launch the channel, broadcasting for up to seven hours per day, seven days a week and including 1.5 hours of original programming.

The launch has been made possible after the BBC Executive and Gaelic Media Service concluded a co-funding agreement. Content will come from the BBC and a variety of other sources.

Public Value Test (PVT) Process

The BBC Charter requires that all new or substantially changed BBC services should be subject to a Public Value Test (PVT) by the BBC Trust.

The PVT consists of a Public Value Assessment done by the BBC Trust, and a MIA carried out by Ofcom. The MIA is intended to ensure that the BBC’s new services are consistent with the development of a vibrant and dynamic commercial sector.

Ofcom’s initial consideration of the Gaelic Digital Service proposal suggests it will not raise significant issues. As such Ofcom is consulting on a simplified approach where it is hoped the MIA will be completed in less than the standard three month timeframe. The closing date for responses is 7 September 2007, with a delivery date to the BBC of 26 September 2007.

Subject to the completion of this PVT by Christmas and the approval of the BBC Trust, the new service is expected to launch before the end of March 2008.

Gaelic Digital Service

The Gaelic Digital Service will be the BBC’s first UK public service to be substantially funded by a party external to the BBC. Its £17.9m annual running cost will be made up of £10.1m from the Gaelic Media Service and £7.8m from the BBC. £2.5m of the BBC spend is new expenditure on Gaelic.

The Service will also benefit from promotion and programming from Scottish Media Group (SMG) to the value of £1.2m over three years from 2006. This is in return for a reduction in the amount of Gaelic programming SMG is required to broadcast in peak-time under the terms of its Ofcom licence. The Gaelic Media Service has also purchased SMG’s entire archive of Gaelic programmes for the new channel.

At least half of the programme funding provided by the Gaelic Media Service will be spent in the independent sector. It is hoped that up to half of non-news and current affairs for the channel will also come from independent producers, subject to a sufficiently developed Gaelic production base.

The channel will initially be available on satellite, broadband and cable. It will then become available on digital terrestrial television in Scotland as digital switchover progresses. Thus it will be available nationwide by 2012.

Ends.

Notes for Editors and CSEs

1. The BBC Trust's Public Value Test has three components. The first is a Public Value Assessment, carried out by the Trust. The second is a Market Impact Assessment, carried out by Ofcom to terms agreed jointly by the Trust and Ofcom. These run concurrently. The third is the Trust's consideration of both assessments: the Public Value Test, resulting in the Trust's provisional conclusions which it publishes for consultation before reaching its final decision.

2. A press release was also published by the BBC Trust. It can be found at http://www.bbc.co.uk/bbctrust/news/press_releases/2007/gds_pvt.html

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