Βι¶ΉΤΌΕΔ

Speech given at the Westminster Media Forum

12 March 2002
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We have gathered at this meeting today to discuss how the broadcasting industry can serve the public interest in the digital future. I want to comment on the Βι¶ΉΤΌΕΔΒ’s role in that future - a role which I believe will remain absolutely central to UK broadcasting for many decades to come. Our mixed broadcasting ecology, with public and private sectors both playing large, complementary roles, can serve Britain just as well in the future digital age as it did in the analogue age which is now ending.

I shall start by commenting on the line-up of services which the Βι¶ΉΤΌΕΔ will need to play its central role in our digital future. Then I will comment on how the governance of the Βι¶ΉΤΌΕΔ needs to be modernised to dove-tail with the rest of the UKΒ’s new regulatory regime after the creation of Ofcom. And finally I shall comment on three specific tasks that the Governors will face in the new age Β– to ensure fair trading by the Βι¶ΉΤΌΕΔ, to prevent the the Βι¶ΉΤΌΕΔ from dumbing down, and to prevent quality programmes from being shuffled away from Βι¶ΉΤΌΕΔ ONE and TWO and towards minority digital channels.

When I became Chairman of the Βι¶ΉΤΌΕΔ last October, I inherited an organisation which in many ways was in rude good health. If you were to base your view of the Βι¶ΉΤΌΕΔ on the ritual abuse we receive in parts of the press, you might conclude that we are doing everything wrong. But the public does not agree. In terms of audience figures, whether measured by reach or share, our performance has been strong, across all of our services.

Β· Βι¶ΉΤΌΕΔ Radio took a 53% share of the total radio audience, well up on previous years. (Reach 62%)
Β· Our online service Β– Βι¶ΉΤΌΕΔi - increased its reach to almost six million users, up from just over four million a year earlier.
Β· The World Service attained a new high of 153 million regular listeners worldwide.
Β· Βι¶ΉΤΌΕΔ TWO remains the only one of the traditional television services which is retaining its audience in the face of multi-channel competition.
Β· ItΒ’s astonishing to think that 35 million people in the UK turned to the Βι¶ΉΤΌΕΔΒ’s radio and television news services on September 11th. Even today in this world of media proliferation, itΒ’s still true to say that the important things we all share, we share through the Βι¶ΉΤΌΕΔ.
Β· And of course, famously, last year Βι¶ΉΤΌΕΔ ONE beat ITV in audience share for the very first time ever. Even when ITV was off the air owing to a strike for 12 weeks in the late 1980s, they still beat us!

I am sure that many of you are thinking Β– that is all very well, but the Βι¶ΉΤΌΕΔ should not be all about ratings. Of course it should not be. Distinctiveness and near universal reach are both critical objectives for us. But I do want the Βι¶ΉΤΌΕΔ to remain, in the digital age, a mass market public service broadcaster, not one which is confined to a tiny corner of the market, like the PSBs in the United States.

For us to truly serve the public, and justify the licence fee, we must first make sure that the public consumes our services in huge numbers. We simply cannot deliver value for money, or attain near universal reach, if we only serve minority tastes. I know that is highly inconvenient for some of our competitors, who would like nothing better than to box us into an ever-diminishing space, but it is a fact.

So we must continue to serve mass audiences in the digital age. In the last month alone, we have launched five new digital services Β– Radio 5 Live Sports Extra, 6 Music, CBeebies and CΒι¶ΉΤΌΕΔ for children, and Βι¶ΉΤΌΕΔ FOUR. I have no doubt that some of these new services will take time to win mass audiences, but that eventually they will do so.

When we first launched Βι¶ΉΤΌΕΔ TWO in 1964, the initial audiences were so small that they failed to register on the statistical charts. It was the same when FM radio started in the early sixties. So I am not concerned about the criticism we received last week about the audiences for Βι¶ΉΤΌΕΔ FOUR. Give the new service a chance Β– it has already won a lot of critical acclaim, and I am confident that large audiences will follow.

Our expansion into new services is now almost complete. We will not have a tank on every lawn, but we will have a presence in most of the areas which are needed to offer full public service coverage to the nation. Our portfolio of TV and radio channels, and the development of our online services, was largely planned in the late 1990s by John Birt, Christopher Bland and their respective boards. Greg and I are fortunate that they thought deeply about the right structure for the Βι¶ΉΤΌΕΔ, and were able to persuade the Government to accept that structure, and to fund it appropriately. This is hugely in the public interest.

Of course, there is one very important loose end. We would like to get permission from the Secretary of State to launch Βι¶ΉΤΌΕΔ Three, a new public service channel for young adults. We see this as vital in three respects.

Β· First, this group of the population has become increasingly detached from public service genres, especially news and current affairs. It will be hard to win them back Β– and extremely hard without the new approaches we plan on Βι¶ΉΤΌΕΔ Three.
Β· Second, we have lost reach among young adults. In order to ensure universal reach for the Βι¶ΉΤΌΕΔ - an objective which everyone says we must fulfil - we badly need a service like Βι¶ΉΤΌΕΔ Three.
Β· Third, we believe that we need a full portfolio of channels to enable us to market our digital plan to the 60% of the nation which has so far been unattracted to digital television on subscription. Without Βι¶ΉΤΌΕΔ Three, our digital proposition looks that much less compelling, and analogue switch-off looks that much further off. And a flourishing future for DTT Β– something which is greatly in the interests of both the Βι¶ΉΤΌΕΔ and the nation - would be that much more difficult.

In the past couple of weeks, our competitors have suggested that Βι¶ΉΤΌΕΔ Three would cost them Β£25 million a year in lost revenue. Our own estimates, based on independent research by Oliver and Ohlbaum, suggests that any loss would be only a tiny fraction of this figure, perhaps about Β£4 million. And remember, to set against this, the channel intends to invest about Β£80 million per annum in UK production of new programmes.

Of course, the Βι¶ΉΤΌΕΔ recognises that times are tough in the advertising market. But every month that passes without getting permission to launch Βι¶ΉΤΌΕΔ Three is another month in which we cannot spend that Β£80 million on domestic production.

I should just say to our competitors that it is obvious to most fair minded people what is motivating them when they complain about the Βι¶ΉΤΌΕΔ. Many of their complaints are based on understandable self interest - the kind of self interest which I would expect if I were one of their share-holders.

I notice that our competitors have started to complain rather loudly that the licence fee offers stable funding for the Βι¶ΉΤΌΕΔ, at a time when advertising and subscription revenues have been going through a sticky patch. Funnily enough, we did not hear so much about relative income growth during the 1990s, when private sector revenues were surging relative to the licence fee. The recent past has seen only a small redressing of the balance. It is surely far-fetched to blame the Βι¶ΉΤΌΕΔ for some of the problems which private sector broadcasters have recently encountered. The Board of Governors might be responsible for many things, but the short term financial performance of commercial broadcasters is not prime amongst them.

But I get more concerned when complaints come from friends of the Βι¶ΉΤΌΕΔ - from people who are genuinely sympathetic to our aims as a public service broadcaster. I am concerned that the Βι¶ΉΤΌΕΔ is sometimes seen as aloof, arrogant and inaccessible. I am worried when the Βι¶ΉΤΌΕΔΒ’s friends say that they are confused and troubled about the way the organisation is governed.

And that is why we have now decided to modernise the way the Βι¶ΉΤΌΕΔ is governed.

Some have argued that the Βι¶ΉΤΌΕΔ should come under the proposed new media super-regulator, Ofcom. Surprisingly enough, I tend to agree - so it should, in many respects. There is a strong case for a level playing field in the regulation of broadcasting.

But the effect of the GovernmentΒ’s latest plans has been widely misunderstood in the public debate. Actually much of the Βι¶ΉΤΌΕΔΒ’s activity will in fact fall fully within OfcomΒ’s remit - key issues such as economic regulation, and basic content standards and quotas for independent and regional production. In these areas, the Βι¶ΉΤΌΕΔ will be treated just like other broadcasters.

This leaves the public service remit of the Βι¶ΉΤΌΕΔ and other broadcasters. Here, a level playing field will be established not by altering the position of the Βι¶ΉΤΌΕΔ, but by shifting the position of ITV (and others) decisively towards the Βι¶ΉΤΌΕΔΒ’s current arrangements.

In future, both the Βι¶ΉΤΌΕΔ and private broadcasters will be primarily subject to self-regulation in this crucial final category. The only difference is that back-stop powers will rest with Ofcom for the private broadcasters, while they will rest with the Secretary of State for the Βι¶ΉΤΌΕΔ.

We believe that this difference is justified. A "light touch", largely commercial, regulator like Ofcom is suited to wield back-stop powers over the relatively limited public service remit of private broadcasters.

But in the case of the all-encompassing public service remit of the Βι¶ΉΤΌΕΔ, a "light touch" regulator is hardly sufficient. Detailed regulation by a Board of Governors is necessary. And it is surely also sensible that the ultimate back-stop powers for a publicly-owned and publicly-funded organisation should rest in the democratic process, subject to frequent and direct Parliamentary scrutiny.

That said, the Governors have decided that a package of internal reforms is required, to ensure that Βι¶ΉΤΌΕΔ governance can indeed address some of the concerns mentioned earlier. These reforms are intended to achieve four key objectives:

Β· First, to ensure that the key distinction between the role of the Governors and that of the Executive is clearly understood inside and outside the organisation. For the first time, we are publishing a clear statement of the very different roles which the two boards fulfil to achieve their common public service purpose.
Β· Second, to ensure that the Governors exercise their authority in a way which is compatible with the new role of Ofcom. This requires Governors to focus their attention on the Βι¶ΉΤΌΕΔΒ’s public service remit more than ever before. A new framework for setting objectives for the organisation, and for monitoring these objectives, will be needed to achieve this.
Β· Third, to ensure that the Βι¶ΉΤΌΕΔΒ’s governance is a model of openness and accessibility. This will require an overhaul of the way in which we explain the aims of our services to the public, and then consult them about whether these aims are appropriate, and whether they have been met.
Β· Fourth, to ensure that the Governors are properly supported to fulfil their responsibilities. This will require the creation of a new Governance and Accountability Office to replace the SecretaryΒ’s Office, thus providing the Governors with more independent sources of advice and support on compliance, objective-setting and accountability.

If you read some of the press comment about this final point, you would have been forgiven for thinking that we were creating a group of political aparatchics across the Βι¶ΉΤΌΕΔ. One paper even suggested that I was eager to dilute the power of the Governors by surrounding them with a bunch of political cronies bent on taking over Βι¶ΉΤΌΕΔ News!

This of course is just total garbage Β– and is an intentional distortion of everything that the Governors are trying to do. Our sole objective is to strengthen the role of the Governors, their operation and their independence by providing the specialist professional skills and resources they need to do their jobs.

Last week we advertised for the post of Head of this new Objectives and Compliance team. Look at the advert and the job description and youΒ’ll see for yourself that this is more like a lawyerΒ’s job than that of a political special adviser.

And let me spell it out in language that the headline writers in the popular press will understand: Jo Moore need not apply.

I hope that these reforms will help to persuade Parliament that the public service remit of the Βι¶ΉΤΌΕΔ is in safe hands. And now let me comment on three specific areas where the Governors need to remain particularly alert.

First, fair trading. We frequently hear allegations from our competitors that the Βι¶ΉΤΌΕΔ is trading unfairly against them. Yet not a single one of these allegations has yet been upheld by the relevant competition authorities. It is important for policy makers to remember that, in this area, private broadcasters are scarcely unbiased observers seeking to make arguments in the public interest.

The Βι¶ΉΤΌΕΔ Board of Governors, by contrast, has no shareholders to consider, and has only the public interest to worry about. That is why we are so concerned to ensure that our Fair Trading Commitment is upheld, and why we investigate complaints on this subject with great care, using external auditors to assist where necessary. As I say, we normally find that that complaints are unfounded, and we have recently been told by officers of the competition authorities that they too are frustrated by the large number of bogus complaints they receive about the Βι¶ΉΤΌΕΔ. But let me assure you that we will continue to examine each complaint on its merits, and take action where necessary.

Second, dumbing down. As I said earlier, the Βι¶ΉΤΌΕΔ must never be all about ratings - or even mainly about ratings. This is why I am proud to say that many of our landmark programmes in the past year stand comparison with some of the best that the Βι¶ΉΤΌΕΔ has ever made: Blue Planet, Walking with Beasts, Son of God, Clocking Off, The Way We Live Now, Conspiracy, Lost World. I could go on, and on.

But even in the face of this roster of stunning programmes, I am concerned that the Βι¶ΉΤΌΕΔ still stands accused of maintaining our audience share by "dumbing down" our output, especially on television, and especially on Βι¶ΉΤΌΕΔ ONE.

I think that the perception of dumbing down stems partly from the massive proliferation of television output which has occurred in the past 10 years. Not all of it can be good, and when you sample 200 channels, 10 seconds at a time, with your remote control in hand, you can be forgiven for concluding that most of the output is of dubious quality.

But actually that is why the Βι¶ΉΤΌΕΔΒ’s family of quality channels is becoming more important than ever before.

And our analysis of what is available on Βι¶ΉΤΌΕΔ ONE and Βι¶ΉΤΌΕΔ TWO does not support the claim that we are dumbing down our main channels. Βι¶ΉΤΌΕΔ ONE has not dramatically changed the mix and content of its programmes in the past 10 years Β– in fact, we are spending just as much as we have ever done on arts, science, history and current affairs, and we are showing more "public service" hours in peak time than we did five years ago.

One thing has gone missing from our schedules at peak time Β– the off-the-shelf American drama series like Dallas. But surely that is a good thing. We should certainly be spending our licence fee income on Clocking Off - a great British drama tailored for a British audience - ahead of American imports.

Many people say to me Β– why canΒ’t we have television series like Civilisation, and the Ascent of Man, which we had 30 years ago, in the so-called golden age of television? They were great series, but they attracted very small audiences, in the region of one to two million per week.

We still make great series Β– like the Blue Plant, Simon SchamaΒ’s History of Britain and Walking with Beasts. And they attract audiences five to ten times as large as the landmark series of yesteryear. So we must be doing something right.

Yet still the criticism for dumbing down will not go away. Typically, this criticism comes from a particular group of people in the UK. They tend to be southern, white, middle class, middle aged and well educated. Strangely enough, they are already the type of people who consume a disproportionate amount of the Βι¶ΉΤΌΕΔs services - people who get more out of the licence fee than they put into it.

In some cases, the criticism of dumbing down is simply a respectable way of trying to hijack even more of the Βι¶ΉΤΌΕΔΒ’s services for themselves.

The unique thing about the Βι¶ΉΤΌΕΔ is that we all pay exactly the same amount for it. The Asian teenager on the streets of Leicester has just as much right to be heard, and to be served, as a member of the House of Lords in Westminster. The fact is that they may not want exactly the same thing, but we have to serve them both.

So the debate about dumbing down should be about how to ensure quality and enrichment for all our licence fee payers, and not about skewing our services to appeal to a small minority. Some people continue to argue that we must choose between mass audiences and programme quality. But at our best, we can achieve both Β– after all, 80 million people watched the eight episodes of Blue Planet last year. Unless we can achieve quality for all, we will not deserve the licence fee.

Third, and finally, what about the argument that we are shuffling all our quality programmes away from Βι¶ΉΤΌΕΔ ONE and TWO, and towards minority digital channels. Here I can be quite emphatic - the Βι¶ΉΤΌΕΔ has no intention of doing this, and the Governors would stop it, if anyone tried.

Let me give you the example of arts coverage - an area of much recent concern. Since last September, the Board has conducted a comprehensive review of the Βι¶ΉΤΌΕΔΒ’s arts strategy, including long discussions with the Controllers of Βι¶ΉΤΌΕΔ ONE, TWO and FOUR.

Following that discussion we are now reviewing our commitment to the arts in our radio and online services:

Β· We have agreed a benchmark baseline of 230 hours of arts programming per year on ONE and TWO in addition to our digital output. We are well on target to exceed that for the year 2001/2.

Β· We will spend Β£53 million on arts and music programming across our television channels in 2002/3, the biggest ever Βι¶ΉΤΌΕΔ investment in the genre. This figure includes our investment in the special programmes and performances to celebrate the QueenΒ’s Golden Jubilee, but compares with Β£36.9 million across ONE, TWO, CHOICE and Knowledge for 2001/2.

Β· In addition to the figures above, the Βι¶ΉΤΌΕΔ also spends Β£23 million per annum on supporting the five Βι¶ΉΤΌΕΔ Orchestras and the Βι¶ΉΤΌΕΔ Singers.

So we are already taking a rigorous approach in monitoring these commitments. Our intention is to conduct similar reviews of other genres periodically. We also recognise that our findings must be announced regularly to the public and we will therefore report on the Βι¶ΉΤΌΕΔΒ’s performance against all these commitments in the Annual Report.

We now intend to go further. The Βι¶ΉΤΌΕΔ will publish its first set of Statements of Programme Policy for each of our public services in mid-July alongside the Annual Report. In our Annual Report we already report on the actual hours of output by genre on each of our network television and radio services. We have now decided that these Statements will include forward commitments to a minimum number of hours in the main programme genres. We shall then report on performance against the commitments set out in the Statements in the following yearΒ’s Annual Report.

I hope that these steps will reinforce the ability of the Governors to guarantee that the Βι¶ΉΤΌΕΔ continues to fulfil its basic public service remit. This is at the heart of ensuring that the public continues to value and trust the Βι¶ΉΤΌΕΔ. On average, each citizen spends 22% of their leisure time in the company of the Βι¶ΉΤΌΕΔ. ThatΒ’s a lot of information, education and entertainment for Β£109 a year - in the digital age, just as much as in the past.

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