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BBC is still struggling with the digital switch, says watchdog
It brought you Monty Python and Jimi Hendrix, but Auntie Beeb must compete with digital monsters like Netflix
The BBC has failed to plan for switching to internet-based media and move away from traditional broadcasting at a “more wholesale, strategic level,” according to a public spending watchdog.
The UK's National Audit Office said the boss of the hundred-year-old broadcaster had set out a vision for where it should aim to be by the 2030s, and “that the BBC would be active in future in planning for the switching off of traditional broadcasting.”
“The BBC has, however, to date only conducted limited work planning out scenarios in which it could potentially move away from traditional broadcasting at a more wholesale, strategic level. Nor has it set out those older services which it will protect, or the wider implications of removing certain broadcast channels for access by disabled audiences and other groups at risk of being digitally excluded,” the NAO said in a report this week.
The BBC, which accrues around £5 billion ($6.15 billion) in revenue from a £159 ($196) licence fee from most UK households as well as from its BBC Studios commercial unit, is tasked with managing the transition to digital-only online services while continuing to support its audience for traditional broadcast television and radio.
The BBC Studios commercial unit contains its global distribution arm, which jointly owns BBC America with AMC Networks, although that channel is broadcast via the basic cable network in the US.
In 2021-22 in the UK, meanwhile, the BBC's streaming app iPlayer accounted for 16 percent of all BBC TV viewing in the country, whereas 73 percent of UK adults in households with a TV still watched BBC via traditional television broadcasting.
Founded in 1922, the BBC is a corporation incorporated under Royal Charter granted under the Royal Prerogative. The current BBC Charter came into force on 1 January 2017 and runs until 31 December 2027. A television licence is required for each UK household where television programmes are watched or recorded as they are broadcast, regardless of the signal method.
Critics see the funding mechanism as an anachronism in a world where audiences have a choice between a number of subscription services including Netflix, Amazon Prime, Disney and Spotify. But supporters see it as offering a unique model to bring quality content to a national — indeed global — audience.
Probably most famous globally for bringing Sir David Attenborough, costume dramas and Monty Python to screens around the world, the BBC must also balance its move to a greater digital presence with maintaining its critical national infrastructure responsibilities, the NAO said.
"Under obligations set out in the BBC's governing documents, such as its framework agreement with government and its Royal Charter, the BBC is required to take all reasonable steps to minimise the risk of disruption to the broadcast and distribution of BBC radio and television services. This requires the BBC to maintain a traditional broadcasting network because of the greater resilience it provides over digital and the universal coverage it enables," the report said.
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The national infrastructure aspect of its work, together with the Royal Charter, places an additional burden on the BBC which online competitors do not shoulder. At they same time, competitors can spend more on digital technologies. The BBC's digital product group invested £98 million ($121 million) in 2021-22, compared with £1.7 billion ($2.2 billion) Netflix spent on technology and development.
The BBC also competes for radio audiences with services such as Spotify, which spent £766 million ($944 million) on digital development in 2021-22. BBC Radio helped many globally influential music acts receive early national radio exposure, including rock legend Jimi Hendrix, hip-hop pioneers Public Enemy, and grunge poster-boys Nirvana, who recorded a session for John Peel in 1989, two years before their global smash album Nevermind was released.
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The Corporation is also struggling to retain tech staff, holding up its digital projects, as pay fails to keep pace with market demand.
"In common with other organizations, the BBC is experiencing technology staffing shortages and high turnover of staff. This is partly due to the BBC’s pay levels being lower than some other potential employers for technology professionals... In its product group, for example, the BBC had 23 percent staff turnover as of June 2022.
"The BBC attributes its underspend in 2021-22 partly to difficulties in recruiting staff. This high number of vacancies is slowing technical development. The number of vacancies in the search team, for example, means the BBC has been unable to develop its search function further," the NAO said. ®