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21|01|08

The New Review Of Public Service Broadcasting

Ian Hargreaves, Senior Partner, Speech to Salford Nations and Regions TV Conference

Good afternoon.

My thanks to Ray and the conference team for giving Ofcom this opportunity to update you on our second review of UK Public Service Broadcasting (PSB).

My aim in these brief comments is to let you know where we’ve got to on the review in general.

And to give you a sense of how we’re approaching the review with regard to nations and regions.

This second area is the aspect of the review with which I’m personally concerned, given my responsibility for Ofcom’s work in Scotland , Wales , Northern Ireland and the English regions.

Let’s start with the update.

Ofcom is charged by Act of Parliament to review PSB at least every five years, with two main aims in view:

We can only fulfil this second objective by taking stock not only of the whole broadcasting scene – including cable and satellite – but also the online world, other platforms and the context provided by established media, such as radio and print.

Parliament gave us these responsibilities because of the extraordinary importance we all attach to public service broadcasting and because it was clear at the time of the 2003 Communications Act that change would be rapid in the new digital age and that this would present risks to the public service broadcasting settlement.

So it has proved.

Formal switchover from analogue to digital terrestrial television has now started; Copeland in Cumbria last year; Borders this year.

And after that, the deluge.

Over 85 per cent of UK homes now have digital TV (up from 40 per cent at the time of the last review) and over 50 per cent of UK homes have broadband.

Meanwhile the internet has already overtaken radio as a medium for advertising and is well past the half way mark with regard to television.

These and other factors explain why Ofcom decided to get on with the current review this year, rather than waiting until next.

We were also mindful of the Government’s own commitment to review the funding of PSB in 2010, making it possible to see through any necessary legislation by 2012 - the year we complete the switchover process.

In between these two formal reviews of public service broadcasting, Ofcom has not been idle.

We have:

and we have also:

So our timetable looks like this:

Both these two phases will be subject to full public consultation

So how does this framework fit with the issues facing the nations and regions?

The answer, I think, is: awkwardly.

And for two reasons. First because the four nations – England , Scotland , Wales and Northern Ireland – are subject to differing political pressures.

Second, because the legacy of public service broadcasting in each nation is also quite distinctive – think S4C in Wales or the north-south issues that affect Northern Ireland .

It is therefore quite unlikely that a “one size fits all” approach to public service broadcasting settlement will work in the nations as well as we need it to work.

That’s a crucial point and it will inform our thinking as we seek to identify the outline of a new public service settlement.

Let’s talk about the debate that’s now picking up strength right across the UK .

In Scotland , as we heard this morning, a devolved government is interesting itself vigorously in broadcasting matters. Ofcom has given evidence to the Scottish Broadcasting Commission, which is asking serious questions about serious issues.

The Commission will, I imagine, be making recommendations and stimulating debate about matters that fall both inside and outside the remit of the Scottish Government which established the Commission. The political contours here aren’t neat.

There’s an early focus on economic issues: decline in production from Scotland for television networks: a story charted from data gathered by Ofcom. That and a drop on spend within Scotland on news and current affairs.

There’s also renewed debate about national broadcasting voices for Scotland . And with Gaelic we expect to hear in the next few days about the BBC Trust’s verdict on plans for a new Gaelic channel. Ofcom has been closely involved in working with the Gaelic Media Service.

After it has spoken on economic issues, the Jenkins Commission will move on to cultural and democratic matters. We wait with interest to see how these are defined.

In Northern Ireland , the political debate, once transfixed by sectarian issues, is increasingly focused upon economic and cultural problems and opportunities.

Politicians north and south of the border are talking about how to maintain or perhaps even extend the overlap of north-south services in the digital era. The indigenous language issues here, touched on the Good Friday/Belfast Agreement, have yet to be resolved in detail.

Meanwhile, in Northern Ireland , audiences to local programming remain strong. Stronger than elsewhere.

In Wales , the story is different again. Here the indigenous press is weaker than in other nations. But public investment in the Welsh language service S4C is much larger than in indigenous language services in the other nations. Indeed, PSB spend on Welsh language programmes runs far ahead of English language programmes for Wales .

Yet in other respects, Cardiff , Belfast and Edinburgh are at one. For example, in complaining about sparse coverage of their national elections by London news rooms supposedly committed to UK-wide public service news.

Labour and Plaid Cymru, which form the governing coalition, have spoken of the need for a “communications strategy mandate.” When the Ofcom board meets in Cardiff next month, we will be taking the opportunity to update ourselves on these matters, not least by talking to the Ofcom advisory committee in Wales . These advisory committees, which operate in all four nations, are increasingly important sources of insight and challenge for Ofcom.

As this uni-directional ratchet of devolution clicks on, there are signs of a response in England .

Malcolm Rifkind has proposed restricting Westminster voting on English matters to English MPs. Gordon Brown, in one of his early moves on taking office as Prime Minister, has established a network of parliamentary committees to attend to issues affecting English regions.

Ofcom’s own research on regional news suggests that interest remains compellingly high in many regions of England . The fact that only a very substantial minority of Londoners – 36 per cent - declare themselves interested in regional news reflects a well-understood pattern.

But Ofcom’s latest research puts that interest-level figure at 60 per cent for the South-West, a figure which matches the score for Wales , which is itself behind 70 per cent in Scotland and 82 per cent in Northern Ireland .

We also know that in the nations and regions, plurality of supply of news is also of major importance. No-one prefers a monopoly supply of news.

But clearly in a digital world, where thinking is not confined to the patterns established by television transmitter masts, it makes sense to inquire more deeply than the ancient duopoly.

When people speak about news and other programming which speaks to their geographic identity, which geographic unit do they care about most? The devolved nation? The region within the nation? The locality within the region? The communities of place and interest now served by community radio? Or the communities of global interest served by on-line social networks?

How do new developments such as emerging local TV, and newspaper-based and other broadband services, play into this? Channel M here in Greater Manchester is one very interesting example.

Likewise ITV Local, though it currently depends on the regional ITV infrastructure to make it work.

Ofcom’s Digital Local report identified the particular role broadband can play in local content.

Our Digital Dividend Review proposes that spectrum should be packaged in a way that is suitable – though not reserved – for local TV over DTT.

Ofcom’s latest policy document on radio makes new moves to privilege the national perspective in thinking about “localness” requirements in analogue radio.

Viewed from these perspectives, there is everywhere the scent of opportunity. We must not forget that.

But nor should we forget a more familiar question: how do these issues fit with the agendas now being pursued by the commercial PSB networks?

The answer to that is: unevenly.

At present, Channels 4 and Five broadcast no dedicated output for the nations and regions. Indeed, in the expiring analogue world, Channels 4 and Five are not even ubiquitous broadcasters in the UK .

But both Channel 4 and Five are good citizens when it comes to the out of London quota. Both are currently exceeding their quotas of 33 and 10 per cent respectively for network production outside London . Channel 4 has worked hard to nurture creative communities around the UK .

But both are also economically challenged: Four with its predicted ‘funding gap’ in future years, and Five by the fact that it has by far the smallest programme budget of any of the PSBs.

And then there is ITV. It makes the biggest contribution - proportionately - of any broadcaster to production outside London . Over 50 per cent but this is, as we know, concentrated in certain English regions, and in particular Manchester and Leeds . Which is not of much comfort to Scotland

Dispersal of production outside London is therefore a major issue with all the networks, and we’ll be looking at this carefully in the PSB Review.

But ITV’s biggest PSB-related cost by far is nations and regions news: about £100m per year across the system.

Circumstances, however, vary considerably around the UK . An issue for UTV in sustaining its strong performance in Northern Ireland will be the extent to which it can continue generating revenue from the south.

The service for Wales has long been cross-subsidised from the West of England; now both are part of the much wider operation of ITV plc.

In Scotland , STV has branched into new sub-regional news and extra news-driven programmes, which is welcome. But no-one doubts that the economic and commercial pressures facing STV are formidable.

The wider context is this: ITV’s status as a provider of international, national and regional news is a vital element in today’s PSB mix. Ofcom will have to make a judgment about the level of priority to attach to these services, alongside other PSB contributions, against the diminishing value to ITV of public service status.

So ITV’s plans to re-organise its regional news operation, announced last September and formally proposed to Ofcom just before Christmas, raise major issues. They lie at the heart of our PSB review, not at its periphery.

That is why Ofcom needs to consider them in the round, which means that they will be examined as part of the current PSB review. So, in line with the timetable I’ve set out to you this afternoon, we won’t be reaching our conclusions on these matters before the early autumn.

Meanwhile, we’ll be doing our own detailed research on these issues and conducting a full consultation.

Which brings me to the BBC.

At the time of the last PSB Review, we suggested that the BBC’s leadership role should extend at least to matching our increased out of London quota for ITV, with 50 per cent of TV production by volume and spend from outside the M25.

At the time, this did not seem to be a welcome message, but more recently, things have been moving.

The transfer of 1500 jobs and one or two key departments to this city has been confirmed, and it would be good if transfer of major commissioning power were to follow.

We have also heard the BBC commit to 9 per cent spend for networks in Scotland – matching the proportion of licence fees bought in that nation.

And the BBC Executive, we know, has plans for local video content, delivered by broadband, matching BBC local radio editorial patches.

It is clear from recent developments that the BBC’s own thinking is evolving in the way that it sees the editorial segmentation of the UK for news and other purposes.

In our PSB review, we will also be asking questions along these lines. What is the relative importance of the nation, the region and the locality? What degree of plurality of service can be achieved at each level? What is the relative role of old and new media in meeting that public need? And how much regulation is needed to make sure that acceptable standards are met?

And whatever the answer to questions like these, what are the practical constraints of building on what is anything but a greenfield site?

So, summing up, what we believe is needed in our PSB review for the nations and regions is the following:

That is where we’re going with our review.

We know that our conclusions will be tested by people and stakeholders with many different perspectives. I hope I have convinced you that ranking high among those perspectives is the viewpoint and the audience expectations of the UK ’s nations and regions.

Thank you for listening


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