The ABC is right to reduce its cost base and outsource television production in Tasmania, even if no one likes it. It makes the most economic sense.
The easy response to the ABC’s decision to axe its Tasmanian television production is to criticise it, which is what plenty right up to Stephen Conroy have done. The ABC is supposed to be a national broadcaster, not a Sydney/Melbourne broadcaster. Its presence is disproportionately important in production in smaller cities. And it’s a terrible time of year for the 16 ABC staff who may lose their jobs.
All true, especially the last one for the ABC staff who face losing their jobs. But there’s a very strong case for the ABC axeing its own in-house production capacity where it’s inefficient and replacing it with outsourced capacity.
The ABC is under constant pressure to be more efficient. As the only genuinely national content producer across television, radio and online, with a budget around $1 billion a year including transmission funding, there’s always the view from outside the organisation that there must be plenty of what Richard Alston used to call “back-of-office” savings that won’t affect production. After all, this is a corporation that holds well over half a billion dollars in land and buildings around the country.
The problem is, many of the ABC’s “inefficiencies” are liked, especially by politicians. Regional MPs, especially Nationals, love its network of regional radio stations, each producing at least a few hours of local content a day and sending reporters to their press conferences. And MPs who aren’t in the east coast states have long complained about the centralisation of television production in Sydney and Melbourne, where economies of scale mean production costs are significantly lower. They love the idea of the ABC making television content in Perth, and Adelaide, and Hobart.
But that costs a lot of money. Bit by bit, the ABC has been centralising its own television production in Sydney and Melbourne. It’s also been outsourcing more production to the private sector. For many years the ABC had what one then-executive called a “standing army” of “the best-paid table tennis players in the world”, production staff in centres outside Sydney and Melbourne who weren’t actually doing a whole lot for much of the time.
In 2006, the Howard government, following the successful SBS independent production fund model (SBSi), gave the ABC $10 million a year to run its own commissioning arm for independent production. This enabled the ABC to leverage funding with the private sector for production, increasing the amount of content it could generate and enabling it to cut down on its own fixed costs.
And you can get some idea of the level of fixed costs of the ABC’s internal television production from yesterday’s announcement by Mark Scott. Sixteen jobs would cost the ABC around $2.7 million a year in salaries and admin costs alone, to produce just a few hours of content
All this has to be seen in context: the ABC still aims to produce 75% of its drama content itself. Yet even the limited outsourcing that has happened in recent years has been attacked by the usual suspects. Quentin Dempster called outsourcing a “policy to dismantle and de-skill internal television production” that meant “our creative independence is being crushed out of us along with a conduit for diversity and originality.” The Friends of the ABC demanded an inquiry.
But this hysteria is absurd. Independent production means more local content than the ABC could provide by itself, and more opportunities for creativity and training within the Australian production sector, while the ABC retains full independent control.
If anything, the ABC should be aiming for a significantly higher level of independent production, up to 50% or more. Haven’t we left behind the era when broadcasters were our sole content engines? There are millions of content producers across Australia churning out terabytes of content online every month. As an innovative Australian content producer at a time when commercial broadcasters are under more pressure than ever before to cut costs, the ABC should be looking outside itself more than ever before for content by Australians.
That logic lies behind Mark Scott’s announcement that the ABC would be establishing a $1.5 million (over three years) production fund for Tasmanian production, aiming to attract matching funding from the Tasmanian government, which will support independent production and guarantee that the “Tasmanian stories” that everyone insists must continue to be told, do indeed get told.
The ABC isn’t merely acting efficiently, it’s also meeting its charter obligations, and doing so innovatively and through mechanisms that recognise the changing media environment it operates in. Critics would do well to understand this before bagging it.
And if politicians want the ABC to spend money keeping standing armies of production staff on standby in smaller cities to produce a few hours of content a year, that’s fine. All they have to do is allocate money specifically for that purpose. Then everyone can be happy.