The UK’s public service broadcasters are facing an “existential threat” from commercial demands made by US tech groups to carry their programmes over the internet, a senior industry executive warned MPs on Tuesday.
British public service broadcasters, such as ITV, are concerned that the UK government’s draft media bill does not set out sufficiently clear rules enforcing a fair commercial relationship between them and online TV platforms owned by large US tech companies.
The legislation, now going through parliament, is in part designed to help PSBs better compete with leading streaming services such as Amazon Prime. One of its aims, for example, is to ensure that viewers can easily discover PSB services such as BBC iPlayer and ITVX on smart TVs and to make them “prominent” on streaming platforms’ systems.
But giving evidence to the House of Commons media committee, Magnus Brooke, ITV’s director of strategy, policy and regulation, warned that online TV platforms could apply commercial terms set at a global, rather than UK, level.
He said such a move could lead the companies to demand more than 30 per cent of revenues from broadcasters, as well as control over important customer data and relationships with advertisers.
“They’ll require us effectively to go into their advertising system, so we won’t necessarily have a relationship with advertisers. We won’t be able to innovate in terms of our ad tech. We won’t necessarily have access to any data,” said Brooke.
“That is an existential threat to PSBs. A third of our revenues is equivalent to what we spend in its entirety out of London in a single year,” he added.
PSBs have voiced their concerns about this matter in discussions with the Department for Culture, Media and Sport and industry regulator Ofcom over the past few months, according to people familiar with the talks.
Brooke said provisions in the media bill to ensure broadcasters could cover their costs was not the right approach because of the need for commercially funded networks to make money, adding that he could not “emphasise enough how important it is for that agreement objective to be recast”.
The legislation — which was last year streamlined by the government — gives Ofcom a dispute resolution function, allowing it to intervene if PSBs and streamers cannot reach mutually beneficial commercial deals. Brooke said the bill needed to give the watchdog “enough strength and discretion . . . to get us into a place of a win win in the way that we have with a Virgin or a Sky”.
Other executives appearing before the committee raised concerns about how listed events, or flagship sporting broadcasts, would be protected under the bill. Meanwhile Khalid Hayat, director of strategy and consumer insight at Channel 4, also criticised the government’s decision to set quotas around the proportion of TV productions made outside London being set in line with absolute spending rather than market conditions.
