Page last updated at 19:19 GMT, Thursday, 11 December 2008

Mixed reaction to TV partner plans

By Torin Douglas
Media correspondent, BBC News

So why is the BBC being so generous, offering to give away the iPlayer, other digital technology and its regional news footage to its commercial competitors?

BBC iPlayer on Virgin Media
Mark Thompson said the BBC should "share the benefits of its scale"

I was asked that by many inside the BBC when the proposals were announced.

But to those commercial companies - facing digital and economic turmoil - the proposals don't look quite so generous. In fact to Channel 4 they don't look generous at all.

Its chief executive Andy Duncan said: "With the exception of the suggested partnership with BBC Worldwide, we don't believe these proposals offer any tangible financial benefit for Channel 4."

The BBC gets around 4bn of public money a year - mostly from the licence fee. In the past, ITV and Channel 4 also got a form of public subsidy - the exclusive rights to sell TV advertising, in an age when there were few channels and an ITV franchise was "a licence to print money".

In return, they were required to provide a range of public-service programming - such as news, current affairs, arts, religion and regional programmes. Much of that has now gone.

'Top-slice'

By the time digital switchover is completed in 2012, ITV and Channel 4 will get virtually no public subsidy at all and they say they can no longer maintain public-service programming without financial help.

Channel 4 says it will need between 100m and 150m a year in some form of public subsidy to make up the difference.

Andy Duncan
Channel 4's Andy Duncan is unconvinced by the proposals

The media regulator Ofcom and the government are looking for a solution, possibly by switching money from the publicly-funded BBC.

One much-publicised idea is to "top-slice" the licence fee, forcing the BBC to share it with some commercial broadcasters. The BBC fiercely opposes that.

Now - in its submission to Ofcom's review of Public Service Broadcasting - the BBC has put forward its own suggestion.

It says it's offering to form a series of partnerships with commercial broadcasters, and says these could generate more than 120m a year for the commercial sector.

It's offered to share its successful iPlayer catch-up service with the other public-service broadcasters - ITV, Channel 4, five, and S4C in Wales - so their programmes will become easier to find and watch.

Details remain to be decided, but there could be a neutral iPlayer website, which would lead into the separate iPlayer services of each broadcaster, which advertisements on the commercial iPlayer sites.

Freeview-style box

Some think this option sounds remarkably like Kangaroo - the proposed joint-venture between ITV, Channel 4 and BBC Worldwide. That has been put on hold while the Competition Commission decides whether it can be made to operate within fair trading rules.

The BBC is also offering to broadcast the iPlayer and other internet video services - such as YouTube - on TV, in a joint venture with ITV, BT and others.

Mark Thompson
Thompson says partnerships are the future of public service broadcasting

Viewers would get a Freeview-style box, connected to their broadband line, and could get all the free TV channels as well as catch-up services and archive programmes, all on their TV rather than their computer.

Virgin already offers such a service, as does BT through BT Vision, but the advantage of the new venture - the BBC says - is it would be an "open platform" that lots of channels and internet service providers could be part of.

To help ITV's hard-pressed regional news services, the BBC has offered to share its TV pictures on some news stories, saving them money.

That goes against the grain in BBC regional newsrooms - used to competing head-on with ITV over the years - but when the BBC has 4bn of public money and ITV has none, and when ITV's regional news is already being cut back, some may feel it is the right thing to do.

Cautious welcome

Broadcasters are used to "pooling" pictures for royal stories and some press conferences. Some say this is merely an extension of that.

Channel 4 and the BBC have very different views

ITV has given the proposals are cautious welcome, saying it has a good track record of partnership with the BBC, on ventures such as Freeview and Freesat, and it said it would carefully consider them.

But Channel 4 said they provided no "tangible financial benefit", other than the suggested partnership with BBC Worldwide, the BBC's commercial arm. Even here, though, Channel 4 and the BBC have very different views.

The BBC has proposed a series of relatively small-scale partnerships with BBC Worldwide. Channel 4 is thought to prefer a possible full-scale merger, with its executives running the business, and the BBC retaining only a minority stake.

This idea has been floated in government and at Ofcom, but at the press conference to announce its partnership proposals the BBC chairman Sir Michael Lyons dismissed it as "extraordinary" and a "distraction".



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