BBC Should Not Overpay for Overseas Shows, Influential MPs Say

An influential group of Members of Parliament has advised the BBC against overspending on the rights to international popular series such as "Suits" and "Schitt's Creek," according to a report from the House of Commons' cross-party culture and media committee.

This recommendation is part of a comprehensive review of the BBC's funding and future, which asserts that the corporation can "spend more wisely when competing for programming." While acknowledging the BBC's "immeasurable benefits" to society, the report argues that reforms to the TV licence fee are necessary to prevent a future of "managed decline."

Committee chair Dame Caroline Dinenage stated that the report arrives at a "pivotal moment for the BBC," which is navigating shifts in media consumption habits, declining revenue, and ongoing discussions with the government regarding its financial model. She emphasized that the government "must ensure the BBC has a universal and sustainable source of funding." However, she also urged the BBC to "sweat its assets and box clever for the licence payer by ending illogical practices such as outbidding commercial rivals for overseas hits."

The rights to air programs like "Suits," "Schitt's Creek," and "Scooby Doo" were acquired by the BBC after their respective contracts with other networks or streaming services concluded. The committee contends that, in a period of constrained resources, the BBC should not be "paying over the odds for overseas content, particularly when it's a bidding war against commercial UK broadcasters," as this does not represent "value for money for the licence fee payer."

The BBC responded by noting that it dedicates less than 5% of its content budget to acquiring external shows, a figure lower than other broadcasters. The corporation views these acquisitions as a cost-effective method for delivering high-quality content, which often leads audiences to discover homegrown programming.

Funding Model Under Scrutiny

The committee also highlighted "considerable challenges" facing the BBC, deeming the current TV licence fee "outdated and no longer fit for purpose." The report points out that while approximately 94% of individuals engage with the BBC monthly, only 80% of households currently pay for a TV licence. Therefore, the committee proposes that the licence fee should be reformed to decouple it from live TV consumption or specific devices like television sets. They suggest that lowering the individual cost while expanding the payer base could make this change more palatable to licence fee payers.

BBC director-general Matt Brittin has previously characterized the existing licence fee model as "a busted flush" and "yesterday's model," suggesting that a price reduction could be feasible if an overhauled system resulted in broader participation. The committee also put forth several other suggestions for the BBC, including exploring the introduction of an international TV licence to boost revenue and global audience reach, collaborating with independent production companies to ensure more programs remain available on iPlayer, and developing its premises with facilities that can leverage new media and support the creator economy.

Furthermore, the committee recommended government support for the BBC, such as legislating for a dedicated BBC button on smart TV remotes, encouraging platforms like YouTube to give prominence to content from the BBC and other British public service broadcasters, and restoring full government funding for the BBC World Service, which it described as "the UK's number one soft power asset."

Wider Recommendations

Support was also voiced for opening BBC iPlayer to content from other public service broadcasters, a move that Channel 4's chief executive Priya Dogra has indicated openness towards. The report additionally called for the cessation of political appointments to the BBC board to enhance governance and maintain public trust. It also recommended that the BBC be assigned new public purposes related to innovation, technology, and combating misinformation and disinformation.

The BBC welcomed the report, acknowledging its "important and interesting recommendations." A BBC spokesperson stated, "We have consistently argued that the current funding model is outdated and needs reform, so we welcome the Committee's support for maintaining universal funding while overhauling the licence fee." They also expressed pleasure at the committee's recognition of the World Service's work and its recommendation for renewed government funding. The spokesperson added, "At a time of huge disruption in the media, the BBC's trust, reach and creative strength remain unparalleled. But we also recognise the need to evolve and move faster towards the future."

The government's Department for Digital, Culture, Media and Sport (DCMS) agreed with the committee's conclusion that supporting an "ambitious and innovative BBC" is in the nation's best interests and that the corporation should not face "managed decline." A DCMS spokesperson indicated that the committee's recommendations would be reviewed in detail, in conjunction with public and stakeholder feedback, to inform future decisions regarding the BBC's Royal Charter.