It has been a bleak week for the BBC.
On Monday it was revealed that the Corporation is no longer definitely to be the home of the Olympic Games in the UK after the US broadcasting giant Discovery, owner of Eurosport, signed a £920m exclusive pan-European deal.
The next day, Tuesday, witnessed the confirmation by the BBC Trust that BBC3 will move online and BBC1+1 will not go ahead after being announced to great fanfare shortly after Tony Hall took over at the Corporation.
The closing down of the youth service as a TV station was never desired by the Corporation’s management. And while the BBC Trust and executive all admit that a move online will result in a drop of of viewers (at least initially), they have been forced to go along with it, adding in some grand talk about developing the internet as the viewing platform of the future. There are obvious doubts whether this will work and a real expectation in many quarters that BBC3 will quietly die.
Yes, of course, the internet is almost certainly going to be the viewing platform of the future. But this is the BBC’s central problem, something we witnessed after director-general Tony Hall announced further cuts today. Yes, Wednesday heralded another black dawn for Auntie.
It announced that around 1,000 BBC jobs will go in the autumn thanks to an unexpected shortfall in licence-fee revenue of £150m because, according to the BBC, more people are watching catch-up content on iPlayer, which currently does not require a licence fee, unless you are watching the live feed. And who can prove that you are?
The BBC wants to close this loophole during this year’s charter renewal process, but once again the Corporation has been caught on the back foot. The iPlayer – a major and impressive BBC innovation – has now become, in a way, a major liability.
When you log on to iPlayer you are asked if you have a licence, and with just a click yes. Who is to check? Why pay for a TV licence when you can watch for free on–line, using a computer where pretty much everything is given to you gratis?
Little wonder that one senior executive said to me this week: “All these bad news stories, you’re going to wonder whether there will be any BBC left by the end of the year.”
That of course is up to the government.
The future of the licence fee is now being determined by hostile-sounding Conservative politicians who will grant the BBC a new funding settlement by the end of the year.
The Tory administration has already indicated that the licence will will remain, although the soundings from within Whitehall (and the new culture secretary John Whittingdale) are that the universal comprehensive flat fee will be redundant by the time of the next charter in 2026.
But with people watching on mobile and tablet, the real concern within the BBC is that the funding mechanism will be severely questioned even in this next charter. “Events are happening at such a pace, I wouldn’t be surprised about anything,” groaned one BBC insider this week.
Because that is the problem for the BBC. Created in a world with few competing platforms, the Corporation’s original offer to inform, educate and entertain with a flat universal fee, cannot last.
There was talk at the BBC three years ago about encrypting the iPlayer and forcing people to enter their licence-fee number in order to use it. But there have been no meaningful ways put in place of guaranteeing that iPlayer viewers are actually paying for this content.
And now more people know about this loophole thanks, in part, to today’s announcement.
It must also be remembered that the BBC very rarely releases any data about licence fee evasion and one BBC source suggested that this was quite a risk.
“They want evasion and the iPlayer loophole to be closed and part of the the charter debate – which is why this announcement was made the way it was,” said the source. “But they also know that in making this public they are also promoting to very many people an easy way of evading the licence fee.”
Whether this gamble will pay off, whether it can close the loophole and still persuade people to pay a fee which looks increasingly like it is voluntary (especially given the government’s soundings about decriminalising evasion, something which is under review) remains to be seen.
If not, it looks like the BBC’s bad week could get a whole lot worse…