The BBC: Diminishing Relevance


Public Service Broadcasting: Diminishing Relevance by Kash Reid-Bashir

When part of Reuters, I was always in awe of the quality of news output the BBC managed to achieve on a day to day basis. Even with a near monopoly on high quality news delivery in the UK the creative output was broadly unbiased, timely and global in scope and coverage. I was absolutely invested in the notion that the BBC was a media organisation admired throughout the world. An institution which would remain unchallenged in my lifetime.

Fast forward 15 years, with a proliferation of content available over a variety of mediums on an increasing number of devices, public service broadcasting seems to be facing a 360 degree assault on its legitimacy and relevance. With a government review announced prior to the BBC’s charter renewal in 2016, I felt compelled to share a few thoughts.

Please see below for an illustration of the BBC Income Stream and Operating Costs:

The Review

The objective of the UK government review is to examine the scope, relevance and charging mechanism related to the BBC. How these factors are structured will have a deep and lasting impact on the organisation over the coming decade.

On first view, it seems that much of the focus at the BBC over the last decade has been on creating an infrastructure fit for delivery of content over the coming years. A secondary focus seems to have been on rationalising the cost base related to the talent pool and core organisation. While these initiatives have been largely successful it seems that the quality of core content has fallen behind other competing broadcasters like Netflix and HBO.

Crowding Out

As for arguments over ‘crowding out’ often levelled at Public Service Broadcaster (PSB’s) like the BBC, it is worth remembering that licence fee revenues equate to around 0.2% of GDP in the UK. To provide another concrete example, licence fee revenues equate to less than 2% of revenues generated by the top 10 global media organisations. Given these two data points, it is fair for one to conclude that the rationale underlying the argument over ‘crowding out’ is quite thin.

Diminishing Relevance

More worryingly, a deep examination of the BBC is likely to reveal that it is not only the lack of high quality, award winning content which is an issue. The main factors influencing how relevant the BBC will remain are environmental. Intuitively, it seems that digitisation has resulted in an ever growing set of high quality alternative options resulting in a steady drop in overall viewing hours dedicated to BBC content. And this is the most damning indictment of all. People are just less aligned to the content on offer relative to any stage in recent history.

For example, it is not unimaginable for future generations to balance the fee paid to the BBC against other content streaming offerings (e.g. Netflix) and question whether they should pay for a service which they do not really utilise extensively.

Redressing the balance – Content and Corporate Venturing

Firstly, in addressing this natural decline, the BBC must create a new mission with a specific focus on delivering award winning, high quality content which engages current and potential audiences.

Secondly, given the shift in environment it would be advisable to create an internal corporate venturing organisation to leverage the vast pool of creative talent which exists at the BBC. Any value generated via ventures seeded, grown and sold could be used to create a fund to finance core programming with less reliance on subscription or fee based revenues over the medium to long term.

On a historic basis, the BBC could have created a venture to sell the Infrastructure and technology related to web based delivery of streaming content.

On a forward basis, it is not difficult to imagine the BBC creating a division dedicated to delivering education and learning over a variety of platforms.

The above are just two areas where there has been a significant level of innovation in the broader market. In terms of concrete examples one need look no further than Youtube, Netflix, Harvard Online Learning and Ted. There is no doubt that, if the BBC were given the remit to leverage their assets in order to deliver entrepreneurial ventures, a significant level of value could be created.


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