Teaching Comparative Government and Politics

Wednesday, September 30, 2015

Privatization of (part of) the BBC

The BBC is an expensive service. Much of the funding comes from unpopular license fees for televisions. The government would like to dump the license fees and get a pile of money from the privatization of the BBC or part of it.

While eliminating licenses is popular, privatization is very controversial. So controversial that the government has denied considering the sale of BBC4 while apparently planning for it.

Labour response is what you would expect.

Government may privatise Channel 4, document reveals
The government has inadvertently provided further evidence that it is looking at privatising Channel 4, after an official was photographed entering Downing Street with a document setting out options for a sell-off.

After months of ministerial obfuscation on whether the sale of the state-owned, commercially funded broadcaster was being considered, the document reveals that proposals have already been drawn up in a bid to raise an estimated £1bn for Treasury coffers…

The report does include several other options including “do nothing”, but the report’s introduction suggests that the government is keen to raise funds from a sale of the 32-year-old channel…

A Channel 4 representative said: “Channel 4’s not-for-profit model enables it to deliver significant public value to viewers and the UK economy with a unique remit focused on innovation, diversity and new talent.”…

Channel 4’s remit [assigned purpose] to cater for minority audiences and take risks is considered by some within the broadcaster as the greatest challenge to privatisation…



Channel 4 privatisation would be an ‘ideological fire-sale’, says Labour
Labour has criticised government plans to explore a £1bn privatisation of Channel 4 as an “ideological fire-sale” that is not in the public interest.

Michael Dugher, Labour’s shadow culture minister, said allowing Channel 4 to be sold off would threaten the broadcaster’s commitment to public service programming…

Former Channel 4 chairman Luke Johnson welcomed the proposals, saying there was no reason for Channel 4 and the BBC to both remain state-owned…

“Channel 4 is a great organisation, a pioneer that makes innovative, creative and marvellous programmes. But technology has changed, [viewing behaviour] has changed, there is competition from Amazon, Netflix, BT and everyone else and it all fundamentally questions Channel 4’s ownership structure. A thorough analysis needs to be done on what C4 might look like if it wasn’t owned by tax payers. Is there a better alternative?”

Channel 4, which is state-owned but funded by advertising, has a remit which includes a commitment to provide distinctive, risk-taking programming, support the independent production sector and promote new talent…

Channel 4 chief executive David Abraham told the Royal Television Society in Cambridge last week that the industry had to “wake up to the consequences” of commercial broadcasters such as ITV and Channel 4 falling into American hands, warning that it would be “sleepwalking … into a different country”…

If Channel 4 is put up for sale, there is likely to be huge interest from prospective buyers, although how much the government might make is difficult to determine.

Suitors could include MTV-owner Viacom, which paid £463m for Channel 5 last year, and other US media giants such as Time Warner, BT and Discovery...

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