Delivering Creative Future: The BBC in 2012 – speech given at QE2 Conference Centre, London
Tuesday 10 July 2007
Check against delivery
Time travel, as everyone knows, is not an exact science. The Tardis may be a miracle of alien technology. The sad truth is that most days it behaves more like a dodgy washer-dryer.
You dial in Mercury and you get ancient Rome. The whole universe is your oyster, but where do you normally end up? Cardiff. Nice.
The memory plays tricks too. Perhaps you remember a simpler world and a wiser, gentler kind of policeman. But when you shut your eyes, the face that stares out at you isn't Dixon of Dock Green. It's DCI Hunt – and he doesn't look very happy.
I want to take you for a spin in the Tardis this afternoon. If all goes well, we'll visit 1962 and The Billy Cotton Band Show. We'll spend a few minutes in the present, looking at some of the choices facing the BBC and other broadcasters right now.
But I want to start where in a way the story ends: in the future. So imagine, if you will, that today is not the 10th of July 2007, but the 10th of July 2012.
The London Olympics are two weeks and three days away. As a result, not just London but the whole country is in a state of incredible excitement.
The world of media is expectant too. Switchover is in its critical phase – within a few months every household in the land will have digital television. Broadband, on demand, digital radio – it's all happening. Broadcasting is at an inflection point.
The world in 2012
Well that's the theory anyway. So let's open the door of the police-box and spend a few moments studying the Britain of 2012.
This is a world of intense experience, open all the time, 24/7. The days are full – competition, the hunger for growth and success, mean that work itself has a new intensity. But busyness stretches far beyond the workplace. Family, voluntary work, above all play – everything intensifies. Less downtime, fewer compromises, fewer restraints. A world, if you want it, of a hedonism never seen before.
It's the most truly global world there's ever been. Information, investment, careers, cultures – for big companies, for the capital markets, for the educated, for the privileged, national boundaries matter hardly at all.
And modern media matches this world step for step. Open all hours. Portable. Personalised. Any fact at your fingertips. Any piece of information or music or entertainment ever created.
It's a world of wired and wireless relationships. Real friends connected around the clock through sophisticated digital social networks and ubiquitous mobile communications. And virtual friends too, if you want them. One endless, humming conversation, day and night.
There are still big events of course – events like the Olympics. And in media, the big blockbusters: the Harry Potters, the Concerts For Diana, the Josephs. But these great basking sharks are surrounded by a billion tiny plankton, individual blogs, reviews, recommendations, chat rooms. No generation in human history has shared so many points of connection. So much self- and group-expression.
It's a daunting, for some of us perhaps a rather exhausting prospect. But it's undeniably exciting and full of promise.
The end of market failure?
And it's exactly when contemplating this world – the world of Facebook and YouTube and Second Life and Skype – that some people find themselves scratching their heads about the future BBC and PSB more generally.
Yes there may be some kind of role. Distinctive, definitely high end. More BBC Two or Radio 4 than BBC One. But admit it, these people seem to say: surely the centre of gravity of media is moving. Away from Reith. Away from any ambitions for the public realm. And inexorably towards choice. Towards the consumer as opposed to the citizen.
The future is young, bold, eclectic, technologically confident. It doesn't want or need any part of the old broadcasting dispensation. And when the generations who grew up with that dispensation die off, the whole notion of public service broadcasting will die off with them. It's seldom put quite so starkly, but that, I believe, is the underlying challenge.
I want to respond to this challenge this afternoon by doing two things. First by stating as clearly as I can what public service broadcasting is, and what it can do. And second, by explaining why I believe the British public will still want it and need it long after 2012.
An enduring idea
Public service broadcasting is not a piece of arid theology. It's a passion – a passion which I believe you can see in Planet Earth and hear in Alan Johnston's voice.
It's also a very simple idea. Writing in The Sunday Times a few months ago, Simon Jenkins said that the modern BBC found it impossible to articulate what its purpose was. Like others, I suspect that Simon fears that all those new channels and services represent a distraction or growth for growth's sake rather than a new means to an old end.
Rather than send him the equivalent of a complete set of telephone directories on the subject, let me try to express it in a few words:
1. Public service broadcasting is broadcasting that seeks to do more than satisfy immediate consumer demand. It seeks to promote a wider good for individuals, for households, for the public at large.
2. Public service broadcasting is the reason – the only reason – why the BBC exists. The point of the BBC is not to make profits or generate value for shareholders but to improve the public's quality of life.
3. The "good", the "public value", which the BBC seeks to build is something which the public at large understands and wants. They tell us so, in overwhelming numbers, every time we or Ofcom or DCMS or anyone else asks them. There is no evidence that this public appetite is reducing in any way. On the contrary.
4. And the good is definable and, with the help of the public, demonstrable. It is set out, more clearly than ever, in our new Charter in the form of six "public purposes". Every year, the Trust will report – with evidence – progress against those purposes.
Purposes, of course, sounds hopelessly dry. Think of GCSE Bitesize helping students to get better grades or BBC Introducing… showcasing unsigned bands up and down the country. Think of Jeremy Bowen using the history of The Six Day War to illuminate and deepen public understanding of the current crisis in the Middle East.
5. My fifth and final point is more complex, but it's worth spelling out because it's the source of so much confusion and misunderstanding.
The only economic justification for the BBC – indeed for any public intervention in broadcasting – is market failure. If purely commercial media can adequately deliver all of the public value that the public actually want, you don't need a BBC or a Channel 4. You don't need a licence-fee. You don't need to intervene at all in the commercial objectives of ITV or five or anyone else.
We should acknowledge moreover that commercial media can and does deliver public value: Sky News helping citizens understand the big issues of the day; Disney, Time Warner and Dreamworks delivering high quality original family entertainment; and so on.
The claim for public service broadcasting – and for the BBC – is not that it seeks to correct some absolute market failure, that without it there would be a public value score of zero. It is that it delivers far more public value than the market would on its own. More than that, that it conditions the media market as a whole, promoting more quality and more choice than otherwise would be the case. Finally that it encourages a culture of creative risk-taking which would be impossible to justify on purely commercial grounds.
So: yes – market failure is key. If there is no market failure, you don't need public service broadcasting. And yes – PSBs like the BBC must demonstrate that what they offer is distinctive and has a meaningful and net positive effect on the choices available to audiences and on the creative industries as a whole.
But beware of crude and self-serving versions of the market impact argument – or the suggestion that if anyone anywhere is producing a given genre to any standard then the case for PSB involvement instantly collapses. In survey after survey, the British public themselves make it clear that they have a broad rather than a restrictive definition of PSB.
But that does not mean that audiences are completely satisfied with current PSB provision. Far from it.
Last week the BBC Trust published fresh and detailed research into the views of licence-payers of the BBC's current performance against its purposes. There's a lot more positive than negative on the scorecard, but significant weaknesses as well. The public rate us highly for factual and knowledge-building as a whole: they think we do rather less well in practical skills and learning. They mark us down for local relevance.
Most of all, although they give the BBC pretty good marks for quality, they want much more innovation from the BBC. They see too little of it elsewhere and they expect the BBC – with its privileged funding, its freedom from commercial pressure – to take a lead. I believe they're right.
Back to the future
So we face real challenges even today. But what about the world of 2012? Remember those critics who think that by then it will all be over. No need for remits. No need for public purposes. Leave it to technology and the market.
So let's go back to the future. Because, at least in my version of 2012, other themes are playing out as well. This is not just a brave new world of personal digital empowerment. Despite the myriad theoretical points of contact between individuals, it's paradoxically a rather lonely world, a world in which true moments of connection – perhaps the Olympics will be one of them – feel more precious than ever.
It's also the age of uncertainty. Uncertainty about security and identity. About globalisation and our climate. About our children's diet and health. About democracy and civic engagement.
All not just worthy of public debate, but demanding it. My question is: where exactly in 2012 will these debates take place?
Some, of course, in the margins of MTV and MySpace. But given the scale of the debate, the challenge in terms of public information and understanding, are we really certain that, five years from now, commercial media will be enough?
In the UK, the only substantial TV news and current affairs is associated with public service intervention on the BBC, ITV, Channel 4 and Five. There is one significant and high quality commercial player, Sky News. But BSkyB is not a PSB. For entirely justifiable business reasons, it has removed Sky News from cable and plans to remove it from Freeview homes. By 2012 it may only be available in around only half of UK households – and of course only in households with the income to pay for it.
Now, people sometimes argue that it is only because of the market distortion which PSB, and in particular the BBC, represents that this situation pertains. Take away the licence-fee, and a new, rich and diverse audio-visual news and current affairs tradition would at once begin to flourish.
Don't kid yourself. Around the world, including in markets like the US with no tradition of public intervention like ours, investment in news is undergoing a crisis. In virtually every country I know, newspapers are cutting back their spend on foreign reporting and on investigative journalism as well.
When I was a young journalist at the BBC, the US networks had the most powerful international news-gathering operations on the planet – they were the equivalent of America's carrier-groups and airborne divisions ready to move at a moment's notice to any point on the globe.
What a different story today. As one senior American TV executive explained to me recently: foreign news is complex and generally dispiriting – audiences don't like it very much – and it's expensive and dangerous to make. "Soon", another US editor told one of my colleagues, "international reporting is going to be the wire agencies and you".
Around the world as in the UK, take away the BBC and you will take away much of the coverage – it's as simple as that.
Market failure in the supply of quality news and current affairs is growing.
And it's not just news. Skills and knowledge will be vital if Britain is to succeed in the world of 2012. Yet millions of Britons leave our education system with a deficit which the BBC and other PSBs could help address. For the disenfranchised and economically marginalised, market failure isn't a term of art – it's a personal tragedy.
Or take comedy – apparently exactly the kind of popular entertainment which, surely, a digitally enabled market could provide.
British comic talent and great British comedy writing represent one of this country's biggest contributions to contemporary culture around the world. You know the names: John Cleese, Rowan Atkinson, Richard Curtis, Ricky Gervais, Sacha Baron Cohen.
But of course all of these are names of people whose talent was nurtured, could only have been nurtured by British public service television and radio.
Nobody else in UK broadcasting invests significantly in scripted comedy. Nor is there any evidence that they would do so in 2012 or any other year in the future, even if the BBC and Channel 4 ceased to exist.
Comedy can be very lucrative when a big hit comes along, but for every hit there are many expensive misses. And the strike rate is going down – not least because modern audiences are less willing to invest time and patience in new shows. For commercial broadcasters, it just doesn't add up – which is why none of them invest in it. If Channel 4 and the BBC ceased to exist, every independent comedy producer in the UK would go bust.
And just as with news, this is not just a British phenomenon. In other words, you can't just blame it on the big footprint of PSB in this broadcasting market.
Scripted comedy is in big trouble in the US and most other big television markets for exactly the same reasons. Reality and format entertainment is easier and cheaper. One US network boss said to me the other week: "For American audiences nowadays, comedy is Simon Cowell".
News. Learning. Comedy. I could have mentioned UK drama, children's programmes, documentary, science. It's the same trend in every developed media market in the world.
If you want to see what 2012 would look like without the BBC and PSB, surf through your Sky or cable EPG beyond the public service channels.
You'll find some good programmes there. But there are yawning gaps as well – and it is through those gaps that much of our talent and nearly all of our production base would fall. So too would much of the content which our audiences love most.
Meeting the challenge
But let's say you accept the argument – you accept, in other words, that there will still be critical shortfalls for public service broadcasting to address post-switchover – important questions still remain.
How does the BBC itself need to change to rise to the challenge? And what kind of wider PSB environment will be necessary after switchover? There was a time when the BBC would have simply ignored this second question and, echoing the French king who declared "l'état, c'est moi", would have said: "public service broadcasting – it's us". But that time is past.
We are part of a wider broadcasting environment. We impact on that wider environment. And we have a responsibility to that environment too.
The story of BBC One
But let me begin with the BBC and with what is perhaps the most obvious point of all. What matters most of all between now and 2012 and beyond is that the BBC should be true to itself and its values.
In the past, particularly in the wake of new Charters and licence fee settlements, we've sometimes zig-zagged. We owe it to our audiences – and in this crowded marketplace, we owe it to our brand – to steer a steady course. So: we need to become more distinctive, more single-minded about quality, creativity and our public purposes.
But the history of the BBC and distinctiveness is an interesting, rather counter-intuitive one. So I'd like you to step into the Tardis once again for a whistlestop survey of that most emblematic, most controversial of all BBC services – our pride and joy, BBC One.
And we're going to begin before it was even called BBC One – because there wasn't a BBC Two yet. This is January 1962, 50 years before my chosen future date of 2012.
Now of course the first thing one notices is how little changes over the years. There's the Tonight programme in the early evening, doing much the same job The One Show is doing right now. There's Panorama more or less in the slot we've just moved it back to. There's a soap, Compact, a few police and detective series, Z-Cars, Dixon Of Dock Green and a single play on the Sunday night.
But there are two other interesting features of this schedule. First, a massive reliance on US imports, Laramie, The Defenders, Dr Kildare, Perry Mason itself followed by a movie. Second, there's very little news. 160 minutes of news in the week, 200 hundred minutes of US Imports excluding movies. 240 minutes of home grown drama.
OK, let's jump 20 years to 1982. Tonight has become Nationwide – I'm working on it as a researcher this week, by the way. Doctor Who mark one is established in the schedule. Jim'll Fix It and Les Dawson are the big draws on a Saturday night. News has grown significantly – more than doubled to 425 minutes in the week. But there's still a great deal of American acquisition in the schedule – The Rockford Files, Kung Fu, Kojak, Dallas and an even heavier use of movies. And BBC drama is down: in 1962 there were 240 minutes, in this schedule exactly half that – 120 minutes or two hours across the entire week.
So what does BBC One look like today? It's a much more competitive landscape. Most broadcasters claim that news is a commercially marginal genre at best. American imports are more fashionable than ever. Twenty-five years after this schedule, how has BBC One reacted to these pressures?
Well here's a draft schedule from this coming September. And I think it's very interesting. Look at news first of all: 535 minutes, more news than in any previous era in the channel's history. Home-grown British drama: 450 minutes, nearly quadruple the 1982 figure, nearly double the 1962 figure. US imports: zero. And, by the way, you'll find more specialist factual – Who Do You Think You Are?, Monarchy – and more comedy than in either 1962 or 1982.
Perhaps you feel that quality within programmes has suffered? That the headline statistics mask a mad lurch down-market inside the different genres. Difficult, of course, to prove this either way – but have a look at a taster of then and now.
Judi Dench there in a sneak preview of what we hope will be one of this autumn's treats, Cranford Chronicles.
The fact is that the BBC One schedule is more distinctive than it used to be. The news is longer and more serious. The drama is more varied – albeit with fewer single plays. There's much less filler material.
The BBC has reacted to the arrival of new channels and new competitors by drawing back from those kinds of programmes that can be broadcast by others.
BBC One is the acid-test for popular public service broadcasting – for PSB which reaches mass as opposed to niche audiences. By investing in quality, by taking pretty big creative risks – from Bleak House to The Apprentice, by making different choices than our commercial competitors, BBC One has grown in creative stature in the past few years.
Over the coming years, this process needs to continue. For BBC One – indeed for all our channels – we will continue to acquire TV and film titles when we believe they will enhance the schedule as a whole, but proportionate spend will continue to decline. And often we will simply walk away. Our recent decision to withdraw from the auction for the Australian soap Neighbours is a case in point.
We will continue to compete to retain a handful of top artists because the British public want the BBC to bring them the best original entertainment. But again – as with acquisitions, as with sports rights – sometimes we will walk away.
Last summer we launched Creative Future, our creative manifesto for 2012. What's interesting is the way the public have reacted to the first fruits of this work. The tickets for The Electric Proms were sold out within 35 minutes of the lines opening and the concerts were a great success across TV, radio and the web. We wanted 20,000 volunteers for our archive on-demand trial: we had them within half an hour. We launch the BBC iPlayer in just over two weeks time. Again we expect the public response to be strong.
We know that what audiences want from us is quality they can trust and originality which takes them by surprise. For them, words like distinctive and innovative are not counters in a public policy game. They are immediately and tangibly valuable. For the BBC, they point the way to success.
A more open BBC
But the BBC must change in other ways if it is to meet the challenge of 2012. It must become more open. Open to criticism. Open to external perspectives. Open to the public.
This is a fairly new thought for the BBC and it doesn't come as naturally as creativity. But it's just as important.
Take impartiality. Once the BBC's answer was an easy one: we're attacked from all sides, so we must be impartial. In the memorable words of one previous Chairman: "I think we've got it about right."
Compare that with the joint report on impartiality published by the BBC Trust and management a few weeks ago. The BBC, it suggested, does not always get it right. Sometimes it struggles to find the right way to deal with campaigns and complex issues. Sometimes it does fail to give sufficient voice to ideas or perspectives which challenge orthodoxies, including liberal orthodoxies.
Or consider the way we responded to the recent controversy about Blue Peter. Immediate, voluntary disclosure. Immediate, unreserved apology. Immediate action to minimise the risk of a recurrence.
Modern Britain demands a more open BBC. It demands a BBC which is more willing to admit its mistakes and imperfections. A BBC which is still proud of its excellence but less arrogant with it. A BBC which is up for being a partner rather than a privileged competitor.
To me, responding to this demand is not a sign of weakness, but of confidence and of respect for our audiences.
A smaller BBC
Next the BBC needs to become smaller. Not in its impact, not in its delivery of public value – it needs to increase those – but in terms of its scale as an organisation and in its operations.
The BBC is already significantly smaller than it was three years ago. By the end of this financial year we expect that at least 6,000 people will have left the BBC since 2004 either through redundancy, outsourcing or the sale of some of our businesses. Central departments are a fraction of their size: the headcount reduction in Finance, for instance, has been over 50% – and we're on track to reduce the cost of Finance from around 2% of group turnover to 0.8%. The money we've saved has largely gone into content and services.
Between now and 2012 the search for greater productivity, for greater value from the licence fee must go on. This year's settlement and the Government's goal for the BBC to achieve net efficiency savings of 3% per year for the next six years demand it. But more importantly, we will not be able to afford our own future unless we free up substantial resources from existing commitments.
Contrary to some of the urban myths about the BBC, this isn't going to be easy. We've been worrying away at efficiency since the early Nineties. We've chopped back overheads sharply over the past three years. Independent analysis suggests that our programme prices are in line with ITV, Channel 4 and the market.
But there are opportunities too – especially through technology. Take multimedia production: in other words, combining separate streams of TV, radio and web production into an integrated operation. This is particularly promising in journalism. And here's a second mouthful: end-to-end digital workflow – in other words, one seamless, solid-state process from idea and the initial capture of material in the field or in the studio all the way through production, post-production, transmission, exploitation and archiving.
The promise is not just substantial savings but content which is more apt for the Digital age. You can already begin to see this in operation in the new headquarters of BBC Scotland at Pacific Quay.
Now we know that there are risks. In particular, we know that a change which leads to a reduction in quality isn't an "efficiency", it's a straightforward cut and a diminution in service. It's worth remembering though that, three years ago when we embarked on the present round of value-for-money changes, there was very widespread anxiety inside and outside the BBC about what was seen as the inevitable impact on quality.
Three years on, when we ask the British public about quality, most of the indicators have gone up, not down.
But it will be noisy. The BBC is not so much going through a period of reform as a revolution. A revolution in the way we make and distribute content. A massive shift from London to the rest of the UK. A further opening up of the production market, not just in TV but in radio and the web as well. A sharp contraction not just in our headcount but in our estate and pretty much every other aspect of the physical BBC.
Not all of this is going to be popular, to say the least. As our plans roll out this autumn, I would ask you to remember that around the world most other private and public media players are adopting very similar approaches to productivity and multimedia working; and that the other changes – the move out of London, the shift towards rather greater independent production, the physical contraction of the BBC – are all in line not just with our new Charter, but with the whole tenor of the Charter debate.
Now, there are some who would go further and reduce the number of services that the BBC currently offers. It's appropriate that the BBC Trust should look at this too – though I believe it is very unlikely that the loss of any current service is in the short or long-term interests of licence-payers.
The BBC was early to adopt the idea of portfolios of digital TV and radio channels: now all the UK PSBs have done it and it's standard practice around the world – because it makes sense for audiences. And in economic terms, the real expense is not in the channels themselves, but in the underlying cost of the content that fills them.
And that brings me to the last way in which I believe the BBC should get somewhat smaller. It should make less. It should concentrate its finite resources on rather fewer, better hours of TV and radio and fewer, better web pages. After years of expansion of the total volume of content, this next period in the BBC's history should be about a focus on the content that really makes a difference.
We can then use our channel portfolios – and the new on-demand technology of the iPlayer – to get that content to as many licence payers as possible.
The final arbiters on all these points – the scale of the productivity challenge, the question of how much content the BBC should strive to commission and make, the balance between different genres and different services – will be the BBC Trust. I and the Executive Board will put management recommendations to them in the autumn. And then they will decide.
The wider PSB environment
I want to end with a few thoughts on the wider public service environment. We know now that, with its new Charter and licence-fee settlement, and despite all the questions about scope and market impact and efficiencies, the BBC will still be a formidably strong player in 2012. That is what the British public wants. That is what the UK Government has decided.
But what will public service broadcasting look like beyond the BBC? How confident will Channel 4 be in its remit and in its funding? Will ITV and Five still be economically capable and commercially incentivised to play their part in public service delivery?
And of course behind that lies part of that bigger argument which I've tried to air this afternoon: how much PSB will the UK need in 2012 and beyond? And once the country's decided how much, how best it should it be organised and funded?
First I believe that there are a number of areas – news is the most obvious, but it's not the only one – where plurality of public service supply really matters. Less in my view to provide public service competition to drive up quality, though that is valuable: more to ensure that the widest range of voices and talent are heard.
Second, all public service broadcasters need to be clear about their mission and their public purposes. Whether you support them or not, the BBC now has a clear and explicit set of purposes and a transparent methodology, with the Trust, the service licence system and the Public Value Test, of assessing whether existing and new services are actually meeting those purposes.
Channel 4 and any other broadcaster who wishes to remain, or to become, a PSB should meet the same standard. This is not a matter of restriction – I'm quite sure the mission of Channel 4 should be more flexible, more immediately adaptable than the BBC's: it's a matter of clarity and accountability.
Third, we shouldn't be bound by history. The heritage, brand recognition and creative strength of institutions like the BBC and Channel 4 are precious and almost certainly irreplaceable. But we shouldn't make the mistake of defining the future of public service broadcasting entirely by reference to existing structures. To take one example: we should certainly explore and discuss Ofcom's ideas about public intervention in the web/broadband space with an open mind.
And fourth and finally: though any wider review of PSB inevitably raises questions about the BBC itself – its mission and its funding – the BBC should welcome the review and play an active and positive part in it. We have a responsibility, as I said, not just to defend our own patch but to work with others to find solutions to the question of PSB as a whole.
2012 may seem a long way off. But of course a few miles to the east of us, preparations for the London games are already well under way.
In broadcasting too, we're building the future right now: switchover, on demand, mobile. Behind the scenes, as you've heard, we're revolutionising pretty much everything we do.
The ink may hardly be dry on our new Charter, but we also know that in many ways the debate about the future of public service broadcasting is really beginning now. In my view, it's part of a bigger national debate about what kind of country we want to live in. What kind of quality of life and quality of community we want to enjoy.
The BBC is at the heart of this debate. And if we use the coming years to focus our energies and creativity; to set a distinctive course; to listen and respond to, but also to challenge and surprise our audiences; then we will also remain at the heart of British national life. Not just today. Not just in 2012. But for decades to come.