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21|01|09

Ofcom unveils public service broadcasting blueprint for the digital decade

Giving audiences the programmes they value
Taking advantage of the digital world
Making public service broadcasting sustainable

Video briefing

A blueprint for sustaining and strengthening public service broadcasting for the next decade was today published by Ofcom in its statement Putting Viewers First.

The new approach is set out in a series of recommendations to government and Parliament. It will ensure that people are able to watch programmes they value highly, based on what audiences told Ofcom in the largest-ever programme of opinion research on public service broadcasting.

It will also ensure that high quality content will be available on-demand on digital television, over the internet, on mobile devices as well as in the TV schedules.

The priorities

The main recommendations are:

The BBC. Keep the BBC, funded by the licence fee, at the heart of public service broadcasting in the UK with a role in pioneering the development and take-up of content across new digital platforms. We reject top-slicing the BBCs funding for programmes and services.
Commercial networks. Free up ITV and Five as strong commercial networks making entertaining, engaging UK content including national and international news, but with limited public service commitments.
News. Guarantee choice of broadcast news in Scotland, Wales and Northern Ireland and in the regions of England by planning for a new way of delivering news through consortia funded by competitive tender.
Channel 4. Create a strong, alternative public service voice to the BBC, with Channel 4 at the heart, preferably though partnerships, joint ventures or even mergers. A new remit, governance and accountability will be essential.

In addition:

Childrens programmes and programmes for the devolved nations. Consider funding for content for children and for programmes other than news for the devolved nations, if other recommendations do not sufficiently meet viewers needs and if resources can be found.

Why the UK needs a new public service broadcasting model

The recommendations take advantage of the opportunities created by the revolution in digital media, including the use of broadband and mobile networks to distribute content.

The blueprint also addresses profound structural changes in the commercial broadcasting sector, such as digital switchover and pressures on television advertising, which will create a shortfall of up to 235 million per year by 2012.

If this is not addressed, programmes such as regional news, current affairs, UK childrens programming and some types of drama and documentaries will in the future only be available on the BBC.

Ofcom has set out a series of detailed options designed to ensure this does not happen:

Future role for ITV plc and other Channel 3 licensees

Short term

Given these changes, Ofcom has today decided to adopt the changes proposed in its September 2008 consultation to allow a restructuring of ITVs regional news in England and the Scottish Borders.

This will ensure that ITV prioritises programmes that audiences value the highest, such as peak time regional news coverage and original UK content.

In response to the consultation Ofcom has modified its original proposals in relation to the quota for factual non-news programmes in Northern Ireland.

Longer term

Ofcom wants to support investment in the wide availability of high quality original programming and UK and international news.

Ofcom proposes to position Channel 3 services as commercial networks with a limited public service commitment. Modest licence benefits should be balanced by appropriate obligations on a sustainable basis.

Maintaining Fives public service broadcasting commitment

Ofcom recommends that Five should continue to broadcast national and international news and original UK content. In the longer term Fives obligations would be much more consistent with the proposals for Channel 3.

Delivering news in the devolved nations and English regions

The BBC has offered to share its regional news infrastructure and picture access with ITV this represents an important development. Ofcom will consider whether this raises editorial or competition issues and whether it would put regional news on a sustainable footing in the in the long-term.

However, given the risks and uncertainties, Ofcom believes that the Government should plan for an alternative way of securing regional news for the devolved nations and English regions from 2011.

This could be delivered by independent news consortia, funded through competitive tender and with a broadcast programme slot preferably on Channel 3. Total funding required could be 30-50 million a year.

A strong public service alternative to the BBC

A new organisation, with public purposes at its heart, should be established; Channel 4 is well-placed to be central to this. It would have a new remit to deliver news, current affairs, programmes for older children, programmes made outside London and a full range of digital media content.

This could be created by forming partnerships, joint ventures or mergers between Channel 4 and other organisations. These could generate new value through cost savings, synergies and new opportunities for growth.

One option would be for Channel 4 to form a new relationship with BBC Worldwide, the BBCs commercial arm. Another option could be for Channel 4 to merge with a commercial organisation, such as Five. Any partnership would need to maintain and strengthen delivery of the public purposes.

Partnerships should complement market provision and ensure economic sustainability, accountability, choice and competition. New governance and accountability arrangements would be essential.

Scotland, Wales and Northern Ireland

If resources and competing priorities allow, the UK Government should consider bespoke solutions for the devolved nations, if the other recommendations do not sufficiently meet viewers needs.

A new dedicated channel has been recommended by the Scottish Broadcasting Commission. Alternatively, the UK and Scottish Governments and Parliaments could consider setting up a competitive fund to support initiatives in Scotland-wide television, local television, online and radio.

S4C should continue delivering Welsh-language programming with secure funding from the UK Government. Competitive funding could be used for extra English-language programmes.

Ofcoms consultation also identified emerging support for competitive funding to support greater provision in Northern Ireland.

Childrens programming

A second public service institution could play an important role in delivering content for older children. However, that provision may not go far enough so competitive funding should be considered for childrens content made in the UK.

Local areas

Ofcom is creating more opportunities for local television than have ever existed before by releasing geographically targeted spectrum to the market.

In addition, extra spectrum capacity could be reserved to support local media specifically.

Ofcom will be conducting new work to explore the provision of local content across television, radio, broadband and online.

Sources of funding

There are three main types of funding for government to consider. They are:

1. Existing sources

the core BBC licence fee (for BBC programmes and services);
direct government funding; and
regulatory assets, such as the residual value in the broadcasters spectrum licences.

2. Extra value

proposed partnerships between BBC and other broadcasters;
other partnerships, such as new ventures involving Channel 4 and other organisations; and
the switchover surplus - the 130 million a year that has been allocated from the licence fee to support the digital television switchover;

3. New sources of funding

direct public funding; and
levies on industry revenues.

Next steps

Decisions on many of these matters are needed by the Government within the next year as the current public service broadcasting model is not sustainable.

Ofcoms own work programme will include:

implementing the short-term changes to the licences held by ITV plc, other Channel 3 licensees, Channel 4 and Five;
conducting further analysis into the BBCs partnership proposals;
more analysis of the issues regarding public service content at a local level across all media, including radio;
working with the Government and its Digital Britain project across a range of issues including possible Channel 4 partnerships;
releasing spectrum and promoting super-fast broadband.

Ed Richards, Ofcom Chief Executive, said:

Many people have forcefully expressed their views in the wide-ranging debate about the future of public service broadcasting. But there is one group whose opinions matter more than anyone else: viewers and listeners.

The central challenge is how a strong and historically successful public service broadcasting system can navigate from analogue to digital.

Our proposals aim to sustain the quality and creative spirit of public service broadcasting while capturing the opportunities of broadband distribution, mobility and interactivity.

These proposals set out what we believe is required to fulfil a vision of diverse, vibrant and engaging public service broadcasting content across a range of digital media.