Tuesday night, our time, could see the most important decision for decades in UK media policy: the Government is expected to propose taking some of the licence fee from the BBC and giving it to struggling commercial network, ITV.
If that happens, it will be a reflection of the terrible financial condition of UK commercial TV and radio.
The changes will be contained in the UK Government’s new broadcasting and communications policy.
The BBC is fighting to stop it happening, judging by stories appearing in the London media at the weekend, but from the tenor of the reports its rearguard opposition is shadow boxing: the deal seems to have been done.
The BBC is warning (through its media mates) that stars like Terry Wogan and Jeremy Clarkson would face big wage cuts. Clarkson’s huge salary is already topped up annually by the payment of hundreds of thousands of dollars a year through BBC Worldwide, the production arm of the company which makes and markets the Top Gear motoring program worldwide.
The BBC has been briefing anyone who will listen that people, especially radio and TV stars earning more than 100 thousand pounds a year (around $A230,000) face cuts in salaries if the Government diverts some of the surplus on the licence fee to ITV and to help fund the development of a national broadband system (like our proposed NBN).
Cuts of 25% to 40% have been leaked to the London papers as the BBC prepares to fight dirty to try and keep its hands on the 3.5 billion pounds gathered each year from the licence fee that has traditionally funded its operations.
The report into the future of broadcasting and communications by Communications Minister Lord Carter is now considered very likely to recommend that some of the BBC’s annual revenue should be used to fund regional news services on ITV and broadband for everyone in the UK.
The report will also raise Government options to solve the revenue problems for the Government-owned commercial channel Channel Four which is in danger of going broke by 2012, and will also look at the future of the floundering Five network, which is owned by the RTL group, in turn controlled by the huge Bertelsmann media group of Germany.
At a conference in London last week, Lord Carter said that the digital surplus from the BBC licence fee should be used to help fund universal broadband.
“Our planning assumption is that there is a surplus and it will be a primary contributor to a universal service help scheme,” London papers reported him as saying.
As a result, the surplus will come from the 800 million pounds built into the present six-year licence fee settlement, which began in 2007, to help older and disabled people complete the switch to digital television by supplying them with set top boxes. This is scheduled to be completed by 2012.
There is expected to be a surplus of some 250 million pounds (around $A500 million), based on the present take-up rates of the fund and this looks like being diverted to ITV and to fund broadband.