Has the younger generation already killed off the BBC?

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Has the younger generation already killed off the BBC?
© Provided by The Telegraph bbc

Reaching a centenary is usually an event to be celebrated, but when the BBC licence fee turns 100 next year, the landmark will pass without fanfare for a tax that has almost certainly had its day.

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Critics say the licence fee is an outdated and unwieldy relic of a bygone age, and the Government has given a clear indication it can no longer be justified in the age of streaming and social media.

Culture Secretary Nadine Dorries has made it clear she wants to abolish the licence fee, which would force the corporation’s biggest reform in its history. If the tax is scrapped, possibly as soon as 2027, huge challenges will lie ahead – not least in finding a way to persuade younger audiences to pay for a service they rarely access from a monolith they do not cherish.

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Get it wrong and the BBC could go the way of Woolworths and Blockbuster, once-ubiquitous brands that outlived their usefulness. Get it right and the BBC could transform itself into a true global giant by seizing opportunities that are currently beyond its grasp.

Imagine, for example, that instead of selling its most popular programmes to other broadcasters abroad, the BBC became a subscription service that could attract paying viewers from around the world, rather than just the UK. It might then be in a position to compete with the likes of Netflix and Amazon Prime, which enjoy far bigger budgets.

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Has the younger generation already killed off the BBC?
© Provided by The Telegraph One option would be to make iPlayer a global streaming platform – Philip Toscano/PA Wire

“The idea of a global iPlayer is possible,” said Richard Broughton, research director at Ampere Analysis. “It would have to be phased in because it would take time to build up a budget to replace the licence fee. And it would need to be international as a UK-only subscription model would need to charge up to three times as much as Netflix to recoup what the BBC gets from TV licensing.

“The problem for the BBC is in finding a way to appeal to young audiences, who are used to choosing which services they pay for, while also serving its legacy audience of older viewers and listeners that rivals like Netflix don’t have to worry about.”

The licence fee was introduced by the Wireless Telegraphy Act 1923, during the golden age of silent cinema, the year that Wembley Stadium hosted its first football match, Stanley Baldwin became prime minister and a relatively unknown Adolf Hitler was arrested and imprisoned for the Beer Hall Putsch in Munich.

But while Wembley has since been demolished and replaced by a successor fit for the 21st century, and entertainment has progressed from silent cinema to streaming content on mobile phones, the licence fee has remained, decades older than VAT, National Insurance or PAYE.

Opinion polls have shown a steady increase in support for abolishing the licence fee, with one poll for Radio 4’s Today programme finding 74 per cent of people want it to be scrapped. Complaints about value for money tend to dominate such polls, partly fuelled by constant rows over presenters’ pay, topped by Gary Lineker’s £1.36 million salary (down from £1.75m the previous year) which gobbles up 8,553 licence fees on its own.

Even some within the BBC, which is celebrating its centenary this year, have for some time accepted that the licence fee is unsustainable as a funding model, one that must be replaced by an alternative that allows viewers to opt out of paying for – and watching – BBC services without facing a potential jail sentence for doing so.

“The original justification for the TV licence was that having a TV and watching the BBC were one and the same thing,” said Philip Booth, senior academic fellow at the Institute of Economic Affairs. “Now, though, there is almost limitless choice,and people should not be forced to pay for a service they don’t want to watch.”

Watching scheduled broadcasts is increasingly an activity of the over-30s. Teenagers now watch more television through streaming services than broadcasts (which will not be news to any parent). The watchdog body Ofcom has reported that people aged 16-24 watch just two minutes of TV news per day on average while children are twice as likely to watch on-demand services as live TV.

And while Generation X developed a childhood affection for the BBC as it grew up watching Play School, Blue Peter and Bagpuss (on one of only three TV channels), millennials and Generations Z and Alpha (those born since the year 2010) have no such loyalty to a brand diluted by the internet age, multi-channel TV and now streaming.

The pandemic has accelerated the rise of streaming services and the number of people buying a licence is steadily decreasing. Licence fee income fell by £310million between the financial years ending in 2018 and 2020.

The National Audit Office has said the corporation has been “slow to change” in the face of a revolution in viewing habits and needs to come up with “a clear financial plan for the future”.

Prof Booth said: “The licence fee constrains the BBC because it is stuck with a source of income which will diminish. The restrictions that come with the licence fee prevent it from leveraging its overseas brand, which is stronger abroad than it is here. With those constraints gone, they could raise capital from a wider range of sources like Netflix.”

Has the younger generation already killed off the BBC?
© Provided by The Telegraph Culture Secretary Nadine Dorries – PRU/AFP via Getty Images

The licence fee gives the BBC an income of around £3.75 billion, with another £1.25 billion added through sales of its shows abroad and merchandising, giving it an overall budget which is larger than that of the Foreign Office, Defra, HM Treasury and the Department for International Trade combined.

But it is dwarfed by the budget of Netflix, which spends £12.4 billion making programmes and films, funded by subscribers worldwide and which does not have the financial drain of 24-hour news provision, 62 radio stations or a website covering news, sport, culture and features.

Netflix is able to spend a whopping $13 million (£9.5m) per episode on The Crown, which swept the board at the Emmy awards last year, putting it in the budget bracket of movies, rather than one-hour TV episodes.

Not to be outdone, Amazon Prime is making the most expensive television series in history, a $1 billion (£732 million) five-season adaptation of The Lord of the Rings.

Netflix charges £5.99 per month for its most basic package, while Amazon Prime costs £7.99, but also includes free next-day delivery of goods from its online store.

At £13.25 per month, the BBC licence fee starts to look expensive by comparison, particularly when viewers have to go elsewhere (and pay others) if they want to watch most live sports or award-winning drama like The Crown (Netflix), Succession (Sky), Ted Lasso (Apple TV+), Mare of Easttown (Sky), The Queen’s Gambit (Netflix) or The Mandalorian (Disney+).

Broughton argues that the BBC can only remain relevant to younger audiences if it concentrates on making particular programmes for a particular audience, rather than making shows that appeal to the broadest possible base.

“It’s about picking off niche audiences,” he said. “You need to ensure fresh new content that is relevant to that audience.” In other words, older people might be content to watch repeats of Dad’s Army, but that does not constitute a plan for a future where TV schedules may no longer exist.

Former Cabinet minister Damian Green, however, points out that the BBC is one of the UK’s defining institutions, particularly in the eyes of the rest of the world, and needs to be treated differently to commercial rivals.

The BBC World Service is not only a noble institution in its own right, as the only reliable news source for millions of people living under oppressive regimes, but is also a valuable “soft power” asset, he says, of such strategic importance that it was, until recently, funded by the Foreign Office.

So the question for politicians and BBC bosses as the Government reviews the funding model is whether they can find a replacement that retains everything the public loves about the BBC, while giving them the choice of whether or not they want to access it.

Aside from a subscription model, the alternatives include advertising (seen as a non-starter as the UK advertising market would have to double in size to sustain another major channel), a tax on broadband services (which would still effectively be a compulsory tax) or a broadcasting levy paid for out of general taxation, which would increase with income rather than being a flat fee that hits poorest people the hardest.

David Elstein, former chief executive of Channel 5, has suggested that the BBC could be funded through a hybrid of subscriptions for drama and entertainment, and a small public service broadcasting tax to pay for news, current affairs, arts, religion, regional programmes, the World Service, some other radio stations and some documentaries.

Any form of tax, however, could make the BBC even more beholden to the Government. And that is a solution which is unlikely to appeal to anyone.

Five bits of the BBC worth saving

Our family assembles in delight for Attenborough and Strictly. But in my years abroad for this paper, I came to appreciate – and realise how much many millions of others appreciate – the World Service. That gentle, imperturbable connection to Britain provides valuable reassurance… and great-value soft power.

Harry de Quetteville

Has the younger generation already killed off the BBC?
© Provided by The Telegraph Malory Towers – Darren Goldstein

The BBC is there for me at every point during the day, but it has never been there for me more than when my daughter was born. CBeebies – and now CBBC – has the kind of quality kids programming that you just don’t find anywhere else. My daughter is obsessed with Horrible Histories, Tracy Beaker and Mallory Towers – and it helps that they are incredibly watchable even when you are an adult.

Bryony Gordon

The only thing I would save is Radio 3. Although also a victim of the Corporation’s woke bulldozer – its search for first-rate black and women composers has proved tiresome because there are so few of them, thanks to the social structures of past generations – it alone has maintained a level of seriousness and appeal to people with A-levels that seems long ago to have evaporated elsewhere on the BBC. If it were ever to close, there should be a management buy-out that puts forward a subscription service. I’d happily pay £159 a year for Radio 3 alone.

Simon Heffer

Commercial radio is all middle-of-the-road music and belligerent phone-ins. Only the BBC makes a serious effort to produce radio comedy – for example, the glorious I’m Sorry I Haven’t a Clue, which is still going strong, 50 years after its debut.

Michael Deacon

Has the younger generation already killed off the BBC?
© Provided by The Telegraph Only Connect – Patrick Olner/BBC

For me, life would be fundamentally impoverished without The Archers, while my husband could not survive without Monday quiz night on BBC Two, comprising Mastermind followed by Only Connect and University Challenge. However, my daughters aged 19 and 13 have no concept of terrestrial television schedules, and the very notion of waiting for a once-a-week fix is anathema to the instant gratification generation.

Judith Woods

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