Public Service Media – Knowingly Undersold

Sharon White, Head of OFCOM, is about to make a remarkable leap.

As Chief Executive of the media and telecoms regulator she has overseen a domestic industry facing huge disruption from global, digital companies; now she will become Chair of John Lewis, a domestic retailer facing huge disruption as the high street withers under the heat of globalised e-commerce.

Before leaving OFCOM, she made a speech in a personal capacity at the annual Royal Television Conference in Cambridge last week.

Her parting thoughts were significant since they acknowledged the scale of the issues facing British public service media, something which OFCOM is yet to face up to.

Ms White argued that:

  • The growth of online streaming services such as Netflix and Amazon and video platforms – predominantly YouTube - is a direct threat to the future of public service broadcasting.
  • The influence of British programming and content made by public service broadcasters on the UK population will decline significantly without intervention. By implication, the influence of US programming and cultural forms will rise to take their place.
  • As habits change, engagement with genres of public service television such as news and British-made children’s content will decline. Balanced, public service news’ influence will be hit.  
  • Public service content will need support financially, probably through a levy on the global players, to survive as a force.
  • Public service programming may also need promotional support from the global digital players to retain influence.

This is fundamental stuff.

Sharon White now says that in her opinion the programmes and content that have defined British media quality and values for almost a hundred years will need significant support from the very US tech giants whose growth is ripping apart the ecosystem, if they are to survive.

Regulators and government have done little to preserve the strength of public service media during the last decade.

Remember the curiously named Project Kangaroo? Probably not.

Kangaroo was a paid-for video on demand project unifying content from the BBC, ITV and Channel 4 developed over a decade ago – an early version of Netflix. It was blocked as being anti-competitive by the Competition and Markets authority in 2009, mainly due to concerns that it would dominate the UK market. But the real market was global not national, and Netflix has since won over 150 million subscribers and will generate revenues of around $17.5bn this year.

That regulatory decision killed any chance that a British organisation would play a significant role in global television streaming. Ashley Highfield, then Chief Executive of Kangaroo, might even have had the chutzpah to carry it off.

Then came the do-we-or-don’t-we privatise Channel 4 debate, promoted by John Whittingdale, then Secretary of State at the Department for Digital, Culture, Media and Sport. There were several reports and much destabilising soul-searching. This evolved into a deeply-resisted plan to move Channel 4 out of London. A final dollop of politicised cream created the final fudge – move part of the broadcaster out of London to Leeds, which is lucky to have such a reliable, fast train line back to Kings Cross.

The BBC was next in line when the licence fee was renewed. The Conservative government’s approach, again led by John Whittingdale, seemed driven by a desire to cut the BBC down to size. In a back room deal, the BBC would now pay for the World Service and over 75s’ licence fees. The BBC had been squeezed into a corner and painfully duffed up under the overview of George Osborne.

So, first, regulators destroyed any hope that British media had of creating a British Netflix.

Then government threatened one of the two major public service broadcasters with privatisation.

The addition of significant cost and disruption to both the BBC and Channel 4 was the next step.

Meanwhile the rise of Netflix and Amazon was eating into younger audiences and inflating programme costs. Digital advertising growth was sapping Channel 4’s revenues and the BBC’s income significantly reduced.

Is this a coherent strategy to preserve public service broadcasting? The concept that OFCOM describes as “a cornerstone of the UK’s cultural landscape” that “helps to cohere our society, providing shared experiences of drama, entertainment and learning”?

OFCOM will embark on a major consultation this Autumn about public service broadcasting. Expect lots of meetings, research groups and charts. The result will be a detailed, analytical report on the state of public service broadcasting.

But OFCOM is yet to show that it truly understands public service media and its impact on that most intangible of concepts, national culture. These valuable and unquantifiable concepts do not fit easily into the spreadsheets and consulting boxes beloved of an economically driven regulator.

Channel 4 is a public service broadcaster that was originally created to support an independent production sector, which now has the riches of Netflix and Amazon to feast on; to make trouble in a world of 4 channels when the internet now offers every form of rebellion imaginable; and to give greater access to minorities, which is perhaps the area where Channel Four still excels against its original remit.

The BBC remains a powerful organisation but one whose resources are stretched ever more thinly as it tries to educate, inform and entertain; to satisfy the old and the young as their interests and desires diverge; to satisfy ever more independent nations and regions; to keep up with each technological innovation; and to fight for relevance to all men, women, children and ethnicities.

Meanwhile, ITV has become an almost pure commercial beast beyond its commitment to news.

British public service media needs a brave vision for its future.

The media world will only get harsher. Public service media’s share of the national consciousness will shrink steadily without support. We will all be the poorer without it.

OFCOM should lead, drawing together the public service broadcasters to help set a compelling vision.

With politicians obsessed with Brexit it will not come from anywhere else.

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About Tim Ewington

Co-founder of Shortlist Media. Previously co-founder of media strategy consultancy, Human Capital. Still innovating, consulting and investing.
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