Culture Secretary spoke about the Government’s support for the broadcasting industry in a changing landscape
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Good afternoon everyone.
Thank you, Rob, for that kind introduction and thank you to the Royal Television Society for inviting me along today.
This is my first RTS conference, but so many of you are already so familiar.
It speaks volumes about how engaged this government is with the TV industry, a relationship that’s so important for all of us.
If life had taken a different turn I could have been part of the TV industry myself.
My careers adviser at school told me I had a bright future working in television.
Repairing them at Radio Rentals.
Perhaps some people will wish I had followed that career path instead, but here I am…
Before I start today I want to take a moment to remember one of the all-time greats of British entertainment: Lord Attenborough.
His talents may have gained greatest exposure in the film industry, but he was no stranger to the small screen, serving as chairman of Channel 4.
Nor was he a stranger to the RTS, delivering the Fleming Memorial Lecture 25 years ago.
The title of that 1989 lecture asked whether the Nineties would “bring forth Feast or Famine” for television.
Based on my own memories of the time, I’d probably say we ended up with the latter.
In the early 1990s I had the privilege of going to work in New York.
I loved it, but it always felt odd when I came home for a holiday and found myself with just four TV channels.
And it seemed that everyone in Britain was watching American programmes – Friends, or The X-Files, or Beverley Hills 90210.
It’s all very different today. I was back in New York this summer, and when I turned on the hotel TV I found myself watching Downton Abbey.
I changed the channel and there was a rerun of Dancing with the Stars, very familiar to any fan of Strictly.
While indulging my inner geek online, I learned that a thousand tickets had already been sold for November’s Long Island Doctor Who convention. And when I got back to the UK I sat down on the sofa and was able to choose from well over 500 channels.
That’s almost twice as many as the US had to offer. I’d call that a feast rather than a famine.
Today, any British traveller channel-hopping in a foreign hotel is likely to see something they recognise.
In Kabul right now you can watch Sok Ghwari Chi Shi Millona?
At least I think that’s how you say it…
It’s better-known as Who Wants To Be A Millionaire?
The Great British Bake Off has been exported to France – home of the very pâtisseries that inspire so many of Mary Berry’s technicals.
Probably the biggest show in the world right now, Game of Thrones, is made right here in the UK.
And Chancellor Angela Merkel is a huge fan of Midsomer Murders – or Inspektor Barnaby, as they call it in Germany.
In his MacTaggart lecture, David Abraham raised concerns about American companies investing in British production houses.
But is that a bad thing?
For decades, the Americans dominated the international TV landscape.
Today, the likes of Liberty, Fox and Discovery are coming to Britain to see how it’s done.
For me, that’s a massive vote of confidence in the work you do – work that has had an incredible impact on the UK economy.
Last year the UK television industry generated more than £12 billion of revenues.
Members of the Commercial Broadcasters Association invested £725 million in UK productions.
Indies and super-indies are worth £3 billion, a figure that has grown four-fold in less than a decade.
British multichannel commercial broadcasters turn over more than £5 billion a year.
International sales are worth almost a billion pounds – nearly three times what they were in 2008.
ITV is one of the biggest independent producers in the USA.
And in front of and behind the camera, the TV industry employs more than 130,000 people in the UK, supporting 7,000 British companies.
The economic contribution being made by television is clear, and it’s something I regularly highlight to my colleagues in the Treasury and in Cabinet.
However, let’s not forget the equally vital cultural and social role played by the medium.
The UK was one of the first countries to recognise this.
And I’m glad to say that, in the 21st century, we have succeeded in maintaining a PSB sector that is the envy of the world.
It also remains immensely popular.
PSBs make up more than 70 per cent of viewing in multi-channel homes.
But in recent years we have moved from a market driven solely by public service broadcasting to a more mixed, more global ecology.
A recent study by COBA found that the number of TV channels in the UK has more than doubled in the past decade.
New channels such as Sky Atlantic are working with independent producers to create incredible, original content like Fortitude and The Tunnel.
With the strength of the multi-channel commercial broadcasters growing, the UK viewing public has never had a greater choice of high-quality viewing. Our television industry is truly a great British success story, and that success is down to your hard work and talent.
This afternoon I want to thank you for all you have done.
But I don’t just want to focus on what has already been achieved. I want to look to future.
A future in which the UK continues to lead the way and our PSBs continue to shine.
A future in which more jobs are created.
More programmes are exported.
And more people than ever are entertained by the best of British television.
As you work to make that vision a reality, you can count on the full and continued support of the UK government.
It’s support that comes in many forms.
We’ve introduced tax reliefs for animation and high-end TV that have already led to almost half a billion pounds of production investment.
Similar incentives for the film industry proved instrumental in bringing production of the new Star Wars and Harry Potter movies to Britain.
We’re investing a billion pounds in the digital infrastructure that you rely on to create content and that consumers increasingly rely on to consume it.
There’s still a lot more to do, still too many people struggling with slow internet connections.
But with average broadband speeds triple what they were in 2010, we’re making rapid progress.
We’re fighting for you too, working as advocates for the UK TV industry on the domestic and international stage, everywhere from Edinburgh to MIPCOM.
We’re celebrating the success of more ethnically diverse broadcasters such as Sky, and challenging the whole industry to do more and do better when it comes to nurturing talent from all communities.
We’re absolutely committed to minority language broadcasting, a crucial part of the UK’s cultural life.
S4C’s funding has been safeguarded until 2017, we’re doubling government funding for MG Alba, and providing an extra £4 million for the Irish Language and Ulster-Scots broadcast funds.
And, as with all sectors of all industries, we’re looking at ways of reducing the regulatory burden broadcasters face.
We’re gathered here today to talk about “politics, power and the media”.
And I have a very clear view of what power politicians should have over the media.
As little as possible.
Politicians and Government have no business controlling television.
What we do have is a role to play in making the industry work for viewers.
That’s why we’re going to look at whether the time is right to remove Section 73 of the Copyright, Design and Patents act, which could allow PSBs to invest more in high-quality content.
And that’s why, in the coming weeks, I will be taking a long, hard look at the balance of payments between broadcasters and platforms.
In our Connectivity, Consumers & Content strategy paper we set out our ambition for “zero net fees”, and a lot of progress has been made towards reaching that goal.
But I still want to know whether the amount of regulation around these transactions is really necessary.
And of course any changes here could have implications for other parts of the industry, such as EPG prominence. But as you know we’re also going to be consulting on that issue shortly.
This is a complex area and it’s a high stakes game for everyone.
But that’s not going to stop me asking questions whenever I see a highly-regulated market.
Can we do this better?
Can we take government out of what should be a private matter between two private companies?
I hope to find some answers in the coming months.
Because, ultimately, our role as government is to ensure that viewers are the winners.
That means helping you deliver the highest quality content at the best possible price to the widest possible audience.
As with every other industry, broadcasting works best when the consumer is king.
When it responds to market signals and changing tastes and delivers a product that customers want and enjoy.
And, as with every other industry, that can’t happen if government red tape keeps getting in the way.
That doesn’t mean I’m going to stand here today and rip up the rule book or promise a whole new regulatory framework designed to meet the demands of 2014.
As my colleague Ed Vaizey has said before, we don’t need a regulatory regime that can answer all the challenges of today, or even of the next decade.
We need one that can adapt to whatever the future may throw at us.
After all, when the 2003 Communications Act became law, YouTube didn’t exist.
Netflix was a DVD rental service.
The idea of Web 2.0 and user-generated content was a minority interest.
The Act was cutting-edge when it was passed, but before the ink was dry it was already out of date.
We need a regulatory system that can meet the demands of a world that has changed – and continues to change – in so many different ways.
Just look at the way Britain consumes television in 2014.
Almost a quarter of us have watched a television programme on our mobile phone.
Twice as many have used an on-demand service in the past year.
Seventy per cent of young people watch television online, and half their media consumption is done on something other than a TV.
Half a million households watch television through catch-up services alone.
And for many young people, traditional linear viewing is a thing of the past.
So much so that, last month, “binge-watch” was added to the Oxford English Dictionary.
I like to think I’m a bit of a pioneer in this field.
When I was growing up our twice-a-year family treat was to hire a video player.
It might have been a Betamax, I’m going back a few years!
And then we’d all sit down together and spend a weekend bingeing on whatever films had come out of Hollywood and Bollywood in the previous six months.
That’s me, Sajid Javid, the trendsetter!
But all this change doesn’t mean that television as we once knew it is dead.
As John Plunkett and Mark Sweeney have pointed out, while Kevin Spacey was using his MacTaggart lecture to deliver a eulogy for traditional TV, more than 12 million Britons were tuning in to broadcasts of Emmerdale and EastEnders.
The vast majority of viewing is still linear, in the region of 90 per cent.
In fact, research published last year predicted that the convergence of technology may actually cause an increase in linear viewing.
Viewers still want to share stories and experiences, they just want those stories and experiences delivered in a way that suits their needs.
That means new platforms and new devices, something that presents new challenges in terms of spectrum. Almost a century ago, Lord Reith wrote of broadcasting that “It does not matter how many thousands may be listening; there is always enough for others.”
In 2014 that’s not necessarily true.
Spectrum is a finite resource.
With more voices and more pictures and more data clamouring for space on our limited airwaves, we have to make decisions about how that space is used.
At the top of that list is the future use of the spectrum used by terrestrial TV, in particular the frequencies below 700MHz.
It’s an issue the ITU’s World Radio Conference will be looking at next year.
And I know many of you are worried about the prospect of co-primary allocation potentially putting our digital terrestrial network at risk.
There’s still well over a year to go until the conference, so I can’t say too much about the details of the position the UK government will take.
However, I agree with the core findings of Pascal Lamy’s recent report and I’m determined that we should not undermine our much-valued DTT network.
It’s going to take a lot to convince me that there is a case for making the lower UHF bands co-primary. The challenges we face aren’t solely technological.
The commercial landscape is shifting too, particularly around the indies.
The independent production sector has enjoyed explosive growth over the past decade, supported by Government intervention on “qualifying indies” and the Terms of Trade.
But times are changing.
High-profile buyouts have already led to the rise of the “super-indies”.
Foreign investment is pouring into the sector. And the changes to the BBC’s production function proposed in Lord Hall’s recent speech could also have a significant impact.
I want the success of the independent sector to continue.
I want to see talented entrepreneurs setting up production businesses.
And I want to see those businesses flourishing on the global stage.
To ensure that happens in a changing world, we may have to review the Terms of Trade and the related legislation on qualifying indies.
That’s something we’ll be looking at once Ofcom has published its PSB review next summer. Alongside changes in technology and business, there’s also the issue of training.
Of equipping talented people with the skills they need to compete in the 21st century.
I know that’s the subject of the next discussion, so let me take this opportunity to highlight the Sky Academy and 4Talent programmes run by Sky and Channel 4 respectively.
Both aim to create new opportunities for young people, and both should be applauded for their efforts.
And we’ve also just seen a major change at the BBC Trust.
The past few years have been tough for the BBC.
Too often the Corporation has been making the headlines instead of just reporting on them.
But let’s not lose sight of how successful it can be.
Both on-air and behind the scenes, the BBC is home to some of broadcasting’s most talented, hardest-working individuals.
Together, they create exceptional content that is enjoyed across Britain and around the world.
Every week the average Briton spends 18.5 hours in the company of Auntie.
The number of TV channels has exploded in the past decade, but the Corporation’s audience share has only fallen by a few percentage points.
Through television, radio and online, the BBC regularly reaches 96 per cent of people in the UK and a quarter of a billion more in 200 countries worldwide.
It’s a massive institution, it’s a vital institution, and it deserves the very best leadership.
That’s why I was absolutely delighted to recommend Rona Fairhead as our preferred candidate to be the new chairman of the BBC Trust. Rona’s arrival provides the opportunity for fresh thinking at the top of the BBC Trust, a new set of eyes and a new head full of ideas.
When I interviewed Rona it was clear that she has both, and is absolutely the best person for the job.
Just before I came on stage I received a call from the chairman of the Culture, Media & Sport Select Committee, and he told me that her appointment had been approved unanimously by the committee.
Anyone who saw the scrutiny hearing earlier today will be in no doubt that she possesses a unique set of skills with which to tackle the big issues.
Those issues will be front and centre when next Charter Review begins. But that’s not going to happen until the next Parliament.
It was absolutely right that this Government took the bold step of freezing the licence fee in 2010.
It provided the BBC with a stable funding profile for seven years and gave fee-payers some much-needed certainty.
£145.50 is a lot of money for most people to find each year.
Thanks to our long-term economic plan the British economy is growing again after the deepest recession in almost 100 years.
But the hard-working families who fund the BBC are still finding savings wherever they can. While I support the work Lord Hall is doing to find savings across the Corporation, I believe more can and must be done to make the BBC more efficient.
For example, not long after I became Secretary of State I travelled to Jersey to meet the Commonwealth Games baton.
There was a huge crowd there – I was feeling quite flattered until someone told me they were all there to see Tom Daley.
What I found odd was the number of people representing one broadcaster.
The BBC had TEN staff in attendance, three of them reporters. Is that really justifiable? Of course, it’s difficult to talk about the licence fee without asking questions about the enforcement regime behind it.
In 2012/13, almost 200,000 people ended up in court accused of not buying a TV licence.
More than 50 were sent to prison.
When over 10 per cent of Magistrate’s Court cases concern this one offence, you have to ask whether the current system is really working.
So that’s exactly what I’m going to do.
The government is committed to launching a review of decriminalisation once the Deregulation Bill receives Royal Assent.
But we can’t afford to wait that long.
This needs to begin now.
Very shortly I will be publishing the terms of reference for a review of TV licence enforcement.
I expect it to begin taking evidence in the autumn, and to conclude early in the next Parliament.
I don’t want to pre-empt the Charter Review.
I want to ensure that, when it begins, it has a solid evidence base on which to draw.
This will allow it to shape the future of the BBC in a way that works for both the Corporation and those who pay for it.
Whether at the BBC or in the commercial world, television is an industry in which the balance of power is constantly shifting.
Where the number of players in the hunt for quality content has never been greater.
Where competition at all levels has never been fiercer.
But one thing is not in any doubt.
We are living in a golden age for British television.
A time in which the quality of programming is reaching new heights, and innovative platforms are reaching new audiences.
And whether in terms of economic impact or overseas ratings, all the facts show that the people in this room today are among the world’s best and most successful.
I want that success to continue, but I know it’s not going to be easy.
After all, technology is changing.
Audiences are changing.
The television industry is changing.
And, if we want to best support you in the years ahead, the way government works with the media has to change too.
Some of you will welcome that, others will be worried about what it may mean for you and your organisations.
So let me reassure you.
This government is listening to you, working with you, and delivering for you.
The business of broadcasting may be in flux, but our determination to support our world-beating television industry is not going to change.