BBC’s fee stinger

Auds, media react angrily to license hike

LONDON — If public opinion as reflected in the U.K. press is any guide, Oct. 11 may go down as the day the BBC overplayed its hand and revealed the extent of unease at the government’s digital switchover policy.

That’s the day the pubcaster presented figures — and a cultural argument — to back its pitch for a seven-year, inflation-busting increase to the annual license fee paid by all U.K. homes that own or rent a TV.

Previous increases have been negotiated in private between the BBC and the government.

This time it was laid on the table for all to see.

The BBC asked for a 2.3% increase above the rate of inflation, over seven years, justified by its pivotal role in building a digital Britain and a desire to improve program quality.

The total was set at £5.5 billion ($9.9 billion).

Some 70% of the money, $7 billion, will come from internal efficiencies, including around 4,000 job cuts.

But the remaining $2.9 billion must be paid for by audiences.

This means the license fee looks likely to rise from the present annual $228 to around $324 by 2014 — or more if the cost of helping disadvantaged audiences make the switch to digital is factored in.

The present fee generates $5.3 billion for the pubcaster in a deal that expires at the end of 2006. The previous license fee settlement gave the Beeb an increase of 1.5% above inflation for five years.

But the BBC’s attempt at financial transparency backfired as politicians and commentators accused it of corporate greed.

On Oct. 12, the BBC faced a wall of angry criticism as the attack dogs of the British press went into overdrive.

Under the headline “Greedy Auntie,” the Times — owned by News Intl., whose parent company, News Corp., controls BBC rival BSkyB — described the request for a hike as “absurd.” For good measure, the paper derided the pubcaster as a “marauding monopoly.”

The rest of Blighty’s national newspapers, with the exception of the left-wing Guardian, were equally damning.

Even the Beeb’s staff newspaper, Ariel, conceded that critics would balk at the idea of an increase to the license fee in excess of inflation.

All this fuss about price might well bemuse American auds, used to paying far more for their pay TV.

Like the U.K., the terrestrial commercial and pubcaster channels are free-to-air in the U.S.

But most people opt to receive them via a basic cable or satellite package that includes dozens of ad-supported channels, for around $40 a month.

That’s more than double the $19 a month it costs to receive the BBC’s four ad-free channels. That fee also covers the dozens of ad-free radio stations the BBC runs.

Already the signs from the U.K. Treasury are that the BBC’s request will not be met in full, which will come as no surprise to BBC toppers.

A veteran U.K. broadcaster said: “Clearly, this is the start of negotiations. Perhaps by being open in the way it made its case and being specific about the various costs, the BBC is asking government to make a choice about what the BBC’s priorities should be.”

For some, the most disliked aspect of the proposed hike is the fact that the public is being forced to pay the cost of the digital switchover, particularly the cost of forking out for free digital equipment for the elderly and the poor.

“It is totally wrong that government should expect license payers to meet the additional cost of bringing a highly desirable social benefit of a kind that has traditionally been paid for out of general taxation,” says diehard BBC supporter Jocelyn Hay, chair of lobby group the Voice of the Listener & Viewer.

Let the haggling begin.

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