Phones and fines top media's 2008

by Torin Douglas
Media correspondent, BBC News

The media year was dominated by phones, fines and most importantly, funds.

By the end of 2008, the realities of the economic crisis firmly outweighed the unrealities of life on the air and the front pages, as broadcasters and publishers fought to secure their financial futures.

But understandably, the headlines dwelt on the succession of "fiascos" and "crises", at the BBC and elsewhere.

2008 saw the high-profile resignations of Strictly Come Dancing favourite John Sergeant, Radio 2 controller Lesley Douglas, presenter Russell Brand and the suspension without pay of Jonathan Ross.

His oft-reported salary (said to be £18m over three years) gave a public funding foundation to the row over the phone harassment of the actor Andrew Sachs.

The fact that Ross was not sacked was compared unfavourably with the later treatment of the Today presenter Ed Stourton, who learned about his own planned "sacking" from a newspaper journalist.

Financial gloom

By contrast, 2008 saw BBC business editor Robert Peston elevated to guru status, after a string of scoops about the banking crisis and its knock-on effects.

These in turn led to official questions about where he'd got his stories and whether his reports had exacerbated the crisis.

The media themselves were not immune from the financial gloom.

The year saw hundreds of journalists and other media workers lose their jobs at ITV, Virgin Media, the BBC, Channel 4 and a host of newspaper groups, including Trinity Mirror, the Telegraph, Associated Newspapers and Newsquest.

Existing problems, caused by the sustained downturn in advertising and the drift of audiences to the internet, were exacerbated by the global financial crisis.

But some of the media's financial problems were self-imposed - with notable libel and privacy payments and fines imposed by regulators.

The News of the World had to pay £60,000 in damages - and much higher costs - to Max Mosley after falsely accusing the Formula One boss of taking part in a "sick Nazi orgy".

Paul Dacre, editor of the Daily Mail, later made a rare appearance in the headlines when he publicly accused the judge, Mr Justice Eady, of introducing a privacy law by the back door.

Ofcom fines

Express Newspapers had to pay the Find Madeleine McCann campaign £550,000 after libelling her parents, Kate and Gerry. Seven of their friends received a further £375,000, which was also paid into the fund.

And Robert Murat, wrongly accused of complicity in Madeleine's disappearance, received £600,000 from 11 newspapers and a further payment from Sky News.

In the phones saga, ITV was fined more than £5.6 million pounds by Ofcom for its transgressions of previous years. Its subsidiary GMTV paid out a further £2 million.

But these financial penalties seemed mild compared with the collapse of the ITV share price (exacerbated by a Competition Commission order that BSkyB must reduce its 17% stake) and its economic prospects.

With advertising set to go from bad to worse, ITV also had to cope with the loss of its analogue "subsidy" to provide public-service broadcasting (PSB) - a problem also afflicting Channel 4.

ITV's pleas of poverty to Ofcom reaped dividends when the regulator agreed to a reduction in its PSB obligations, including a cut in its regional news staff.

Other broadcasters had to pay up too - licence-payers coughed up more than £500,000 for the earlier phone failures at the BBC, including £95,000 at the end of the year for several offences committed in 2006.

'Top-slicing'

This was an unwelcome surprise, coming after the phone problems at Strictly Come Dancing and the Russell Brand show - on which Ofcom is still pondering - though the good news was that no fine was imposed on the BBC for the misnaming of the Blue Peter cat.

Licence-payers' money was never far from the headlines. Indeed, as a result of the "crises", many people threatened to stop paying the licence fee at all.

The phrase "top-slicing" gained currency as Ofcom floated the idea that some of the licence money should be taken from the BBC and given to Channel 4, to help it out of its own funding problems.

"The BBC has a guaranteed income of almost £4bn a year and that looks more than healthy to a commercial media sector that has no idea how much revenue it will earn next year or the year after."

As its economic prospects worsened, Channel 4 had to abandon its plans - and an Ofcom broadcasting licence - to launch a raft of digital radio stations.

This reinforced a feeling of gloom over the future of digital radio, following the closure of several other digital stations.

The "top-slicing" plan was fiercely opposed by the BBC, as was a later suggestion that Channel 4 should merge with BBC Worldwide, the commercial subsidiary that sells programmes and DVDs around the world.

The BBC pointed out that it was already having to cut costs after the government awarded it a lower licence-fee increase than asked for.

But the BBC still has a guaranteed income of almost £4 billion a year and that looks more than healthy to a commercial media sector that has no idea how much revenue it will earn next year or the year after.

Digital Britain

Throughout 2008, commercial TV, radio, newspaper and magazine groups hardened their opposition to the BBC's business and editorial expansion, gaining support from MPs and in some cases, from regulators.

Towards the end of the year, the BBC Trust turned down plans for the BBC to launch new video services on its local websites, saying this would damage local newspapers' own web services.

Some questions on how public-service broadcasting is to be funded in future will come nearer to being resolved in the new year, when Lord Carter, the new minister for broadcasting and telecommunications, publishes a report on Digital Britain.

He believes that at a time of crisis in financial services, the UK's highly-regarded creative sector can help revive the economy.

That won't be easy, and many independent TV producers may find themselves in difficulty, as well as the channels, as advertising shrinks and budgets are cut.

But at the end of a year when the headlines have been dominated by the "fiascos" and "crises", let's not forget the success of the creative output.

There've been huge Saturday night audiences for Strictly Come Dancing, the X Factor, Doctor Who and Britain's Got Talent.

There's also been high praise for many dramas, comedies and documentaries on the major TV and radio networks - not forgetting the coverage of the Olympics, the US election and the banking crisis.

And now all this is available to millions of viewers and listeners "on demand", via the iPlayer, mobiles, itv.com and the Sky+ box.

In terms of changing the way people enjoy radio and TV, surely that - in the words of John Sergeant - is strictly fantastic!