David Gordon talks to Christopher Bland, the new chairman of the BBC. Do we need public service broadcasting?by / March 20, 1996 / Leave a comment
Published in March 1996 issue of Prospect Magazine
Christopher Bland’s surname is misleading. Robust, Blunt, even A-Touch-Bullying would be more accurate. His appointment as chairman of the BBC, taking over from Duke Hussey in April, has been widely welcomed. He is patently going to be a doughty defender of the BBC’s independence from politicians-many of whom, on the Tory side, he has known since university (where he fenced). His friends are slightly in awe of his abrasive manner and his nonsense-curtailing “Bollocks!” He is rich, having made two piles of money-from a printing company and then from London Weekend Television. He is an entity. Bland becomes chairman as the BBC’s internal drama script changes from “battle for survival against the political regulators” to “fighting the competitive struggle in the marketplace.” The BBC has a new ten-year charter which takes it up to 2006 without any changes to its basic shape: the two television channels, all the radio, a guaranteed licence fee (which has to be negotiated every three years), the right to engage in commercial activities. The BBC saw off Thatcherite slash-burn-and-advertise threats, thanks to supportive ministers, director-general John Birt’s reforms (and the squeals caused thereby), and extensive lobbying. So the BBC remains intact, but is now worried that it will be diminished by market forces. Its share of the national television audience has fallen from 50 per cent in 1989 to 42 per cent now-and to 28 per cent in homes with cable and satellite. While the BBC can expect the licence fee to remain static in real terms, ITV’s revenue can be boosted when advertising times are good, and BSkyB’s revenues are on a steep upward curve as it has set out to buy paying audiences with movies and sports. Rupert Murdoch offered the most money for the Olympics. Luckily for the BBC, the Olympic committee decided to take the lower (by $500m) bid from Europe’s public broadcasters. British politicians are now bidding for popularity by keeping the most popular sports out of pay-per-view or satellite-channel exclusivity. Some see his business acumen as Bland’s virtue. Will he find a way to capitalise on the BBC’s assets to generate extra money? Will he take the BBC into small public-service niches? How hands-on will he be? Interviewed by David Gordon, a former chief executive of The Economist and until recently chief executive at ITN, Bland gives some blunt answers.
Q What trends in the media industry are going to have an impact on the BBC during your reign as chairman?
A The two most obvious are technology-the advent of digital radio and television-and increased competition. Competition for talent, for sporting events, for films, for all kinds of programming, and competition for audiences. Technology and competition are not directly related but they are obviously linked. More channels means more competition.
Q Whom do you regard as the competition?
A Everybody. ITV, the independent radio companies, satellite. Competition is by no means all bad. It does two things: it makes the BBC sharpen up its act and it increases the pool of ideas and talent to draw on. So competition isn’t a one way street.
Q Isn’t BSkyB the biggest threat? It is on a cycle of expansion, with ever more subscribers and thus more money to buy more rights and subscribers. Can you compete with this giant company, which has a market capitalisation of ?7 billion?
A And it has a rising share of the total television dollar, whereas ITV’s and BBC’s will remain relatively static in real terms over the next five years. That share, as you say, enables it to pay more for certain types of programming.
Q Should the BBC compete by trying to do the same thing-except more and better-or should it compete by offering something different. Should it do both?
A You can’t do both. Either you say we are going to take the competition head on and here is where we are going to find the resources to do it-this is how we are going to match the exponentionally rising costs of sporting events and films. Or you say we are not going to take them head on; we don’t have the resources to do it and we will do something different. With regard to sport, the unbundling of the sale of sporting rights is in the interests of the consumer who either cannot afford to or doesn’t want to subscribe to BSkyB. [Unbundling means that the BBC can provide recorded highlights of sport events even where live coverage has been bought by BSkyB.]
Q BSkyB isn’t just movies and sports; it is growing in appeal and is now the gateway not only to its own programming, but to other channels, on satellite but also on cable.
A I think that BSkyB is less strong in the areas that have traditionally been the strength of the BBC and ITV-and it will be harder for it to develop strengths in those areas. Acquiring sporting events and movies is easy. You just write a cheque bigger than anybody else’s. But it is not so easy to build up a real reputation and creative ability in drama (whether mainstream or minority drama), in current affairs, in arts programming and so on. That requires creativity; it requires a corpus of people, a history-it takes time. You can’t just buy it.
Q Why not? The independent production sector, fed by Channel Four and the BBC (which must give 25 per cent of its time to independents), will happily provide excellent programmes.
A It is not that simple. Part of the creative process is in the commissioning, working with the people who are producing a drama or current affairs series. That isn’t a matter of simple acquisition.
Q You might get into a position where the BBC becomes a training ground where distinctive shows are given their first airing, but then BSkyB comes along and says: we will buy that group of people. There was some talk about BSkyB beating ITV for Granada’s Coronation Street.
A Well, they didn’t-and that would have been an act of supreme self-sacrifice on Granada’s part, which has a foot in both camps through Granada Group’s 14 per cent of BSkyB.
Q Let’s go back to whether the BBC reacts to competition by doing the same kind of things or by doing something different. I have always felt that the BBC is in a muddle about this: yes, we do minority programming because the licence fee is for non-commercial programmes-but we need large audiences to legitimise the licence fee.
A That is a valid position in my view. If the BBC is just going to do minority programming, then it is rapidly going to lose public acceptance of the level of licence fee. There is an audience level below which, suddenly, the licence fee becomes untenable.
Q Radio Three has made changes to its schedule and programming as a result of the success of Classic FM. But it has no commercial need to chase the Classic FM audience.
A You can’t have it both ways. On the one hand you might say, look at fuddy duddy old Radio Three, they haven’t even noticed that Classic FM has arrived- they haven’t changed anything. No doubt you would be saying that if it were true. But now they have changed, they have adapted, and you say they are copying. Well, who is copying whom? We were there first, but we reserve the right to change in the light of competition. I don’t think that is despicable.
Q What is the BBC for? What is the meaning of public service broadcasting when the marketplace shows that a minority channel like Channel Four can be self-sustaining, with its advertising revenue producing a huge surplus over its costs?
A The new ten-year Charter has happily answered that question: the government has decided that there is a role for the BBC.
Q The old rationale for the BBC used to be that there is a market failure; that without the licence fee we would not have high quality television and radio. That argument is now being undermined. It might mean-ten years from now-contemplating life without a licence fee.
A It is a ten-year charter and it takes the BBC well past my term of five years. Nevertheless, it is a legitimate question to ask, though it is hard to answer it. I would answer it with another question: if you either turned the BBC into a highly competitive advertising-financed channel (an option now discarded, but which was, plainly, theoretically possible), or if you simply abolished it-who would contest that radio and television broadcasting, and indeed, without being too pompous about it, the cultural, educational and information life of the UK, would be greatly diminished?
Q Is the BBC’s role to satisfy all those domestic needs-or to become Britain’s answer to Disney-Capital Cities/ABC? Virginia Bottomley said what a wonderful brand name the BBC was, second only to Coca-Cola, and that you are the sort of chairman who can “exploit this brand name while maintaining the quality of the BBC, the public broadcaster, at home.” But the domestic and international objectives don’t sit well together.
A It depends on the order and the significance which you attach to them. The main job of the BBC is entirely domestic. It is within the UK, plus the World Service. All other activities, including exploiting the brands through BBC Worldwide or being involved in BBC publications, are a means towards serving that end better and more economically. I am very clear about that: the one is something you do in order to help to achieve the other.
Q If the BBC wants to be in money-making activities it must be geared up to do so: it has to be entrepreneurial and it has to have capital. It doesn’t have much to spare of either.
A I disagree. It certainly has no shortage of the capital it needs for its area of operation. I think it isn’t appropriate for the BBC to seek the kind of capital required, say, to buy ABC, or even, say, to invest in starting three or four cable franchises. But it has enough capital and access to capital to finance the kind of international business that it wants to do.
Q What kind of international business should it be doing?
A Not just to make money. I don’t think that would be appropriate. We have defined its primary reason for existing as domestic, but it ought to be able to make money through exploiting its domestic assets internationally. Which is why, after all, the ITV companies have international arms too. These are not self-sustaining businesses in their own right, or anything like it. They stay in business because if you are lucky you can get 30 to 50 per cent of the cost of producing domestic drama from international sales.
Q Selling existing programmes abroad is something which all broadcasters around the world, private or public, need to do. Starting new channels, satellite or cable, is different. The BBC’s solution has been to say: that’s private enterprise, so we will have a private enterprise partner called Pearson and we will work with it in some kind of inchoate fashion.
A Inchoate is your adjective, not mine. I think it is fairly clearly defined. The BBC brings to the party its programming skills and rights and Pearson brings money. That makes sense to me.
Q Is this fair competition? When I was at ITN we felt that in competing with the BBC in the international television news market, we were competing against a subsidised player.
A The BBC is very sensitive to this. Given that all international programmes are only sold on a marginal cost basis, it is difficult to decide who is subsidising whom. Is the UK viewer who sees Poirot sold to an American network for ?80,000 an hour when it cost ?800,000 an hour to make, subsidising American viewers? The answer is: that’s what you get paid, that’s what those rights are worth, and the same is true for news. The BBC has clear rules on fair trading and one of its Board of Governors’ sub-committees is a fair trading sub-committee to ensure a level playing field.
Q But the rules of the game are set by the BBC’s own commercial policy advisor.
A Refereed by a Board of Governors committee.
Q The licence fee is ?1.7 billion, the total revenues of BBC Worldwide is ?300 million, producing a profit last year of about ?15 million-a 5 per cent margin. Looking five years ahead, what will the turnover of BBC Worldwide look like?
A This is like Roman battle casualties. Say-double!
Q That’s not very much! That’s not Mr Coca-Cola.
A I have no idea. Just let me remind you, I haven’t arrived at the BBC yet. I have not seen the budgets.
Q In the press coverage of your appointment there was heavy emphasis on your commercial background. Is that where you are going to put a lot of your time and attention?
A I am not here to do an executive job in international sales. You should remember that I started my broadcasting life as a regulator. I am a gamekeeper, turned poacher, turned gamekeeper again.
Q Do you have a world view on technological change?
A A world view? Beware of broadcasters with world views! No I don’t. I have, I think, a sensible scepticism about the pace of technological change and the way it affects broadcasters and viewers, and I have learnt through the experience of the last ten years that technology does not drive this industry. In the end it serves it. Sometimes it accelerates the pace of change, but technology on its own doesn’t do much for the viewer. Otherwise Rupert Murdoch wouldn’t be in the dominant position he is in.
Q How do you define public service broadcasting?
A I think I would define it as broadcasting driven by non-commercial objectives. Its objectives must be to do the best possible job within the non-commercial criteria of the media it is in-to produce the best possible range and quality of programming in television or radio that you can produce with the resources that you are given by the licence fee payer. There is probably an official definition too…
Q Surely “producer choice” introduces commercial criteria?
A Producer choice simply says that when you have decided to do something, you must do it in the most efficient way possible. I think it is perfectly proper for the BBC to decide to do something wildly extravagant-say, starting digital radio-but it should then do it in the most economical way.
Q The BBC has tended to use a lot of consultants. You are not a great believer in using consultants yourself, are you?
A I was the youngest partner of Booz Allen & Hamilton, and the first Brit to head their UK operation.
Q So you got your inoculation against consultants early.
A I am very much in favour of using consultants for the jobs that they do best and in short bursts-but they can’t run your organisation for you.
Q Jonathan Miller in last month’s Prospect said about the BBC: “I feel very pessimistic about managerial bureaucratic lingo, this awful talk of ‘remit’ and ‘throughputs.'” Are you going to change that? Are you going to continue to be accessible?
A Oh, yes, to the second question. As to the first question, nobody inside or outside the BBC is in favour of being wooden or bureaucratic. We are all agreed on this. We do not wish to be wooden!
Q How about bureaucratic?
A We will abolish bureaucracy wherever we find it. But one man’s bureaucrat is another man’s tough, efficient manager. In an organisation the size of the BBC, jargon is bound to creep in. The BBC had its own BBC Speak long before Jonathan Miller arrived there. It has just changed. Like all evolving languages, it acquires new words and drops old ones.
Q I have a feeling that Bland Speak won’t be as bland as Birt Speak. How much time will you be spending at the BBC? How many days a week do you think it is going to be?
A As many days a week as is required. Probably between two and three days a week plus weekends and some evenings.
Q What do you think the main difference will be between being chairman of the BBC and chairman of a plc?
A Two obvious differences. The first is the measure of success: it is much less precise in the BBC than it is in a quoted company. Not less important, but much harder to measure. The BBC has actually done some quite sensible things in trying to quantify things. Where they can’t be quantified, it has tried to identify the objectives that it is aiming to achieve. I think the other difference is that the BBC is, by several orders of magnitude, a more important place than anywhere I have ever worked. It touches every aspect of life in the UK. Without being too pompous, it is far more important than the printing business, or a weekend commercial television company, or a scientific instrument company or a freight company.
Q How will you measure your own success over the first five years of your appointment?
A The BBC is in a strong position now. Stronger, I think, than it or the competition realises. The ultimate measure of its success is creativity.
Q What about the independence of BBC news in places such as China? In radio, the World Service broadcasts fearlessly without commercial pressures. BBC World television gives the impression that it is the same kind of thing, but it isn’t. The BBC does not control the distribution and is at the mercy of Rupert Murdoch-or middle eastern money.
A It doesn’t control the distribution but it controls the way in which an individual subject is covered.
Q But if the bills are being paid by somebody else it is likely to be more cautious about how it portrays some news events.
A That is plainly a risk.The alternative is not to do it at all, or to find World Service type funding, which is unrealistic. I don’t think, at least at this stage in its life, that there are serious issues over the BBC’s handling of the news abroad.
Q But if it did become an issue, if there were a lucrative contract to supply news into a region of the world, but with non-BBC influence over the content, where would you stand?
A As a public service broadcaster, I wouldn’t like to do it. I think in that case the BBC should say: “That is not how we work.”