Broadcasting Subsector Series: A radical shakeup -Why Ofcom’s focus on PSB prominence rules matters for the whole industry

Ofcom, the UK’s communications regulator, has warned that without a “radical shakeup”, traditional UK public service broadcasting (PSB) is “unlikely to survive” in the digital age. However, the implications of Ofcom’s consultation on how to assist public service broadcasters (PSBs) in reaching their audiences will ripple industry-wide and go far beyond just giving PSBs a helping hand. Combined with long-flawed rules for electronic programming guides (EPGs), we will look at whether the UK risks making changes which will stifle innovative new services and make the UK less attractive for vital investment by OTT market leaders. UK PSBs may have good grounds to call for change, but is Ofcom in danger of choosing the wrong tools for the job?

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Setting out its vision for the future of PSB in its report Small Screen: Big Debate, Ofcom has highlighted the “urgent need” to overhaul broadcasting laws and regulation to ensure that PSBs can survive in the continually evolving age of online viewing. Streaming platforms such as Netflix, Now TV, Disney, Amazon Prime, and YouTube – whose development has challenged traditional broadcasting and transformed audience viewing habits – could now be obliged to provide public service programming and to feature PSB content on their own homepages.

Ofcom will now consult on the report and its recommendations (to be given in June this year) will feed into the government’s own consultation into the future of PSBs, to be announced in November of this year. If adopted, the reforms to the current framework as set out in Small Screen: Big Debate will represent the most radical development in UK broadcasting rules in recent years.

PSB in more detail

PSB refers to broadcasting intended for public benefit. In UK legislation, PSB is defined by reference to a set of purposes and objectives that specific TV channels (BBC, ITV, STV, Channel 4, S4C, and Channel 5) must fulfil. In exchange for meeting their objectives – which include the delivery of high quality, informative and entertaining content which reflects UK culture – PSBs are afforded certain privileges which ensure the prominence and availability of their content.

Traditionally, PSBs have fulfilled their obligations by delivering their content via broadcast TV. However, Ofcom’s report highlights the need for a more “service neutral” framework and suggests a transition from public service broadcasting to “public service media” (PSM). A shift to PSM would allow PSBs to fulfil their obligations online, as well as through traditional channels, affording them more flexibility and choice as to how to distribute their content.

The decline of PSB

Given the world’s shifting media landscape, Ofcom’s urge for reform is unsurprising. The growing dominance of global platforms “wield[ing] increasing power as the access point between audiences and content”, coupled with an outdated regulatory framework which has not seen major revisions since 2003, when the internet was still in its infancy, means that content released via traditional broadcasting channels is not reaching viewers as it has done historically. For example, the report noted that PSBs accounted for only 38% of total viewing time for people aged 16-34, and that two in five viewers of streaming services say they can imagine watching no broadcast TV at all in five years’ time.

This issue of prominence (the ease with which audiences can find PSB content) is therefore a key focus of the report. Ofcom envisages a future where streaming platforms, armed with their strong global presence and enviable audience engagement, play their part in distributing PSB content. Noting in particular that “Amazon’s Fire TV demands 30 per cent of advertising revenue in return for a prominent position on the platform”, the report highlights that PSBs are currently finding it difficult to “secure traction with [online] platforms”, which puts availability of their online services at risk.

Regulatory change might help, but is it really the solution?

Already, there is debate as to whether forced cooperation between PSBs and online streaming services promotes or stifles, innovation. The report advocates that a revised relationship between PSBs and commercial companies could “drive innovation” and encourage “shared research and development”, whilst “reduc[ing] costs”. Channel 4 has welcomed the report and the BBC is “pleased to see Ofcom’s call for regulatory reform that’s fit for a global, digital marketplace”.

Conversely, Mark Thompson, responsible for the successful digital restructure of the New York Times and former Director General of the BBC, suggests that the drive to revolutionise should emanate from PSBs themselves and urges them to “invest in…engineers and data science” to ensure survival.

In this broadcasting sector series, Bobby Rathore, Andy Cox, Aneesah Kabba-Kamara, Rebecca Lewis and Richard McMorris will explore the detail of Ofcom’s proposals and delve further into the debate:

  • A long overdue reset: a detailed look at why PSB obligations in the UK need to be rebalanced, how they are being reviewed, and the proposed shift to PSM.
  • The wrong answer to the right question? A look at whether enhancing the prominence regime is really the right move for PSBs.
  • Electronic Problem Guides: why the confusing current EPG rules need an urgent overhaul, but why Ofcom must have more than one eye on enabling UK innovation.
  • Paying the BBC to watch Netflix? Why the complex, multi-dimensional debate over the BBC licence fee is about so much more than good Saturday night TV.

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