A new report from the Adam Smith Institute (ASI) - 'Global Player or Subsidy Junkie? Decision time for the BBC' - has been doing the rounds this week after it called for the BBC TV Licence fee to be "abolished" and for the BBC itself to instead become a "subscription service". One of several reasons given is that universal UK broadband coverage and the internet will make "a 'licence' to broadcast obsolete".ASI - The BBC should give up the Licence Fee, currently the source of most of its income, for the following reasons:Whatever the merits or not of those various arguments, we're only going to concentrate on broadband. The government is of course moving towards making broadband download speeds of at least 2Mbps (Megabits per second) available to everybody in the country by
- It criminalises poor people.
- It forces people to pay for genuinely “free” services funded by advertising.
- It obliges the BBC to replicate a crude commercial model based on mass-audience advertising.
- Universal broadband and the Internet make a “licence” to broadcast obsolete. On the other hand, they enable direct delivery of services outside the UK. The current funding model denies access to Britons and others resident overseas.
Related News:In addition the government also wants to help deploy "super-fast" fibre optic based broadband ISP services into rural areas, although we note that there has been NO firm commitment to a specific service speed or 100% coverage. Prior to the election we did hear promises about 100% coverage and 100Mbps service speeds from some politicians but those have since evaporated.
17th July 2010 - Broadband Delivery UK Event Delays 2Mbps Internet Speed for all Until 2015
So, will universal broadband really make the BBC TV Licence fee obsolete? Well if it does then it won't happen for a long time yet and there are several reasons for this, only some of which appear to have been correctly acknowledged by the report. Let's examine what it said.
ASI's Media Expert and Former BBC Producer, David Graham, said in his report:
"The medium of the new age will be broadband via the global internet, enabling the delivery of content anywhere in the world with virtually zero transport costs."
"The medium of the new age will be broadband via the global internet, enabling the delivery of content anywhere in the world with virtually zero transport costs."
The first part is certainly fair comment but to suggest that there are "virtually zero transport costs" for delivery of TV style content to anywhere in the world is not. UK ISPs are already straining under the fast growing weight of demand for online video content, the bulk of which come from YouTube and a smaller amount from similar services like the BBC's own web-based iPlayer .
Bandwidth is certainly not cheap and the market is having a hard time keeping pace with such a significant shift in the online video viewing culture. This currently forms part of a huge debate surrounding Net Neutrality and whether consumers should pay for what they use or not.
If internet TV content really had virtually no costs attached then there would be no need for such a debate to exist but sadly, online video content isn't cheap to deliver. Thankfully the report does recognise this, if only in part.
ASI's Media Expert and Former BBC Producer, David Graham, added:
"We may or may not be on the verge of a revolution in delivery systems driven by universal fast broadband – it is too early to say. However, we can be sure that the technology will keep changing and the trend will be to make it easier and cheaper to produce video content and deliver it.
...
Technological change is already playing a key role in the expansion of Pay-TV and will play an even greater one in future. The internet together with fast home broadband opens up wholly new possibilities. Recently, I hear, good money was earned from the sales of US basketball games to China for $1 per game per person."
"We may or may not be on the verge of a revolution in delivery systems driven by universal fast broadband – it is too early to say. However, we can be sure that the technology will keep changing and the trend will be to make it easier and cheaper to produce video content and deliver it.
...
Technological change is already playing a key role in the expansion of Pay-TV and will play an even greater one in future. The internet together with fast home broadband opens up wholly new possibilities. Recently, I hear, good money was earned from the sales of US basketball games to China for $1 per game per person."
The next and most obvious problem is from "universal broadband" access itself, specifically it's ability, or lack thereof, to deliver the promised content. A minimum download speed of 2Mbps simply isn't going to cut it in 2015, when HD TV content will be common place.
In addition many of the "Final Third" quick-fix broadband solutions, such as Satellite services, couldn't cope with the kind of bandwidth demands that a good quality internet TV viewing experience requires. The service speed would need to be both fast, flexible and affordable. The report acknowledges this too.
ASI's Media Expert and Former BBC Producer, David Graham, concluded:
"On-demand services are only viable with an adequate broadband signal. With adequate bandwidth, you can watch live or recorded content on a personal computer. Technically, you do not even need to pay the Licence Fee to watch content on the BBC iPlayer.
The vast majority of viewing to TV still takes place both on a conventional TV and in the home. But what happens when people are able to avoid live broadcasts and rely on downloads and on-demand services? As one of my colleagues said: “Will everyone with fast broadband end up having to pay a Licence Fee?”
I predict that we will shortly start to hear talk of a new basis for the Licence Fee, to be paid on broadband access rather than on a given receiving device. There will be justified resistance to this, especially if the fee is, as now, proposed as the primary method of funding the BBC."
"On-demand services are only viable with an adequate broadband signal. With adequate bandwidth, you can watch live or recorded content on a personal computer. Technically, you do not even need to pay the Licence Fee to watch content on the BBC iPlayer.
The vast majority of viewing to TV still takes place both on a conventional TV and in the home. But what happens when people are able to avoid live broadcasts and rely on downloads and on-demand services? As one of my colleagues said: “Will everyone with fast broadband end up having to pay a Licence Fee?”
I predict that we will shortly start to hear talk of a new basis for the Licence Fee, to be paid on broadband access rather than on a given receiving device. There will be justified resistance to this, especially if the fee is, as now, proposed as the primary method of funding the BBC."
We have of course been hearing talk concerning a "new basis for the Licence Fee" for some time now and the government is already mooting plans to use at least part of it (3.5% Digital Switchover budget, from 2012 onwards) for funding universal and super-fast broadband roll-outs in the UK. That is nothing new.
The simple fact is that the current 2015 universal broadband commitment (USC) of 2Mbps is still too weak. It will also take many more years to complete a rollout of "super-fast" services to reach everybody, which will stretch well beyond 2015 and could bring us closer to 2020.
On top of that, and in order to cope with new TV content, the services that consumers receive would need to be dramatically more flexible than they are today. This is perfectly feasible over fibre optic lines and 10 years would do it, but it's still far too early for the BBC Licence fee to be scrapped just because of broadband.
ASI Report Download (PDF)
http://adamsmith.org/files/BBCreport(2).pdf
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Comments: 8
Andy McCormickPosted: 5 August, 2010 - 10:11 AM
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It is about time something killed the TV License fee. It has been an unethical, and burdensome tax on the British public for far too long.
The BBC makes far more in sales and other activities, including the commercial channels which show only BBC content leading the public to believe that they are owned by the BBC and therefor in breach of the terms of the BBC Charter and license to broadcast.
However, the 'super fast' broadband of UP TO 8 or 20 Mbps is nothing of the kind with the majority of UK users geting less that 2Mbps downstream and 300Kbps upstream - hardly super fast - and an unreliable and often dial-up speed service. Once this is fixed, sometime after C21N has been fully installed across the UK, then the premis that the use of IPTV will take viewers from traditional broadcasts and effect the income of broadcasters may be looked on as a future possibility.
RichardPosted: 5 August, 2010 - 12:54 PM
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BBC Worldwide, the BBC's commercial arm, has reported total sales worth £1bn for the last financial year.
Sales were up 7% on the previous 12 months, the company said, with brands including Top Gear and Doctor Who performing particularly well.
Profits rose 36.5% to £145.2m, excluding exceptional items, the company added.
Pay the 'stars' and Management less and provide more transparency in the BBC's finances. I agree with the licence based soley on my hatred of adverts.
I love Radio 4 and it alone is worth £100 a year.
MarkJPosted: 5 August, 2010 - 1:33 PM
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I would be worried about what might happen to my favourite TV shows and progs, such as F1, without a national Licence fee. F1 with adverts was horrible and god forbid Sky stick it behind one of their Sky Sports pay-walls.
SPPosted: 5 August, 2010 - 2:38 PM
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Funny how these people who say this is worth £150 alone always forget about those who don't watch or listen to the BBC. It's always the same with these people, I'm alright Jack.
http://www.tvlicenceresistance.info/
RichardPosted: 5 August, 2010 - 6:11 PM
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I must be one of 'these people' you refer to.
SP, thankfully we live in a society where people contribute towards all mannger of things so that things get done and we have a fair standard of living.
Paying £150 a year is small compared to the amounts paid for SKY and other tv services, all of which in my opinion, are well below the standards offered by the BBC.
Good luck if you can watch tv without ever viewing the BBC - must be very limited viewing!
About TimePosted: 5 August, 2010 - 11:25 PM
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I don't own a television because I refuse to pay for the BBC. I feel it's a highly politicised and extremely inefficient organisation that produces low quality programmes.
I would be very happy to see the licence fee abolished as I would no longer be restricted to buying displays without tuners. I also look forward to no longer being constantly harassed about not paying my licence fee even though I'm not obliged to.
It would be interesting to see how long the BBC lasted as a subscription service since it represents extremely poor value for money and produces very little of value. I suspect they would have to slash most of their garbage output and even then would likely operate at a loss.
timelessPosted: 6 August, 2010 - 12:29 AM
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I would be very happy to see the licence fee abolished as I would no longer be restricted to buying displays without tuners.uh just buying CRT monitors wont work... from the issues my friends have had and l personally... it doesnt matter if you dont watch TV, hell if you can access the internet you can access their catchup services... according to the licensing bodies that entitles them to have access to your wallet and the licence fee regardless of the fact of watching it or not.
one thing l am aware of is that its not against the law to be online and not paying the TV licence, its just something they say to have access to a funding source.. however if they had their way it would become law to have the licence carry over to ADSL as well.
May HansenPosted: 28 October, 2011 - 11:06 PM
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Good news, I hope that <a href="http://www.tvlicencephonenumber.net/">TV licensing </a> to be stop. Just my 2 cents opinion.
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