This long piece by former BBC producer Antony Jay, of "Yes, Minister" fame, appeared in the Sunday Times, August 21, 2005:

DIGITAL BEEPS THAT SAY: HACK BACK THE BEEB

The BBC has held on to its special status long enough. Now it must bow to a high-tech revolution and change, says Antony Jay


When I joined the BBC in May 1955 there was only one channel, and we were it. But not for very long: ITV had been given the go-ahead to start in September — an act of cultural barbarism, in our view, and totally unnecessary: we were confident that there was no public demand for it. People were perfectly satisfied with our monopoly service.

But already staff were defecting. It is strange to recall how they were regarded — not just as job-changers but as deserters, traitors, even heretics. Many BBC staff felt an almost religious attachment to the corporation; we were a temple of broadcasting purity, the golden mean between what we saw as the cheap crude commercial populism of the US and the government-run propaganda machine of the USSR.

The strength of this belief derived from the fact that, if it were not true, there was no justification for the licence fee; so we had to believe it. It is not held so strongly now, but it is still there and is part of the argument the BBC is still using to defend itself and its source of revenue.

It was never terribly convincing and has become steadily less so as the commercial channels have shown they can produce excellent programmes in every category, while the BBC screens are plastered with advertising every time they televise a sporting event. Meanwhile the BBC’s need for licence renewal and rises in the fee have made it look more vulnerable to ministerial pressures than its commercial rivals.

An even greater formative influence on the BBC over the years has been that the charter does not require it to produce any programmes. The corporation was set up to provide them, but not necessarily to make them.

Of course when it started it had to produce them — there were no other radio producers in the country back in 1926 — but the dominant ethos has always been that of managing a publishing house rather than editing a newspaper or magazine. So when a third channel became available in the early 1960s it was both a threat and a challenge; the BBC attitude was: “There should not be a third channel, and the BBC should run it.”

These two factors — corporate gigantism and belief in a unique moral mission — have made the BBC what it is today. And yet both are of vanishingly small concern to viewers and listeners. What they value the BBC for, and have throughout its 80-year history, is good programmes, and it has a long and proud tradition of making them.

The behaviour of the BBC has been questioned, challenged and criticised pretty much every day since it was incorporated, but up till now its existence has been taken for granted. Even when I sat on the Annan committee on the future of broadcasting (1974-77) none of the half-a-hundredweight of submissions we received argued seriously for its dissolution.

But the change since then, and particularly in the past 15 or 20 years, has been profound. Videotape, DVDs, CDs, CD-Roms, cable, satellite and the digital revolution have given viewers and listeners a range of programmes unthinkable when I was on the Annan committee, let alone when I joined the BBC back in the monopoly days of 1955. They make it impossible not to ask what the BBC is for. Do we need it at all? And if we do need it, what do we want it to do? And how should it be funded?

I am a Friedmanite; my first reaction is to look to the market for a solution. However, broadcasting has always posed a problem. International telecommunications agreements and a limited frequency pectrum have always in the past created a need, or at least an excuse, for some sort of government intervention or regulation.

But that was then and this is now: cable and satellite broadcasting of digital signals have more or less removed that need, or that excuse. And there is an even bigger threat to that argument coming over the horizon: convergence. It cannot be long before broadband and our TV screens combine to give us access to all available programmes through our computers. In the words of an IT commentator, the computer is converging with television in just the same way as the railway converged with the horse and carriage.

Even a hesitant and moderate libertarian must then ask what business the government has in controlling what we access on our PCs and charging us for the privilege, once terrestrial transmissions are obsolete. It is no different, essentially, from licensing every printing press and bookshop and taxing every reader.

And even if the government continued to try, how would it enforce it? Unless it licensed every PC and laptop (and every mobile phone and BlackBerry for that matter), every user could claim they were not watching, and never watched, the BBC.

Even if the BBC restricted its transmissions to terrestrial digital, does anybody really believe the programmes would not find their way onto some pirate website out in cyberspace? And even if the BBC could stop it (which they couldn’t), nobody would have to pay a licence fee to watch all the other channels. It would become an optional charge. Detector vans would be useless. It seems more likely that within 10 or at most 20 years the licence fee will be indefensible in theory and unenforceable in practice. And what is the BBC for then?

So we are probably discussing only the next decade or so of the licence fee. It could of course be replaced by taxation revenue, but that would entail ministers answering in parliament for BBC programmes. With its financial integrity already compromised by event sponsorship and acres of on-screen advertising at sports events, and its political independence stripped of the figleaf of the licence fee, how do you justify handing it £3 billion of licence money a year?  In the meantime, what do we do? Many people would like to abolish the licence fee and let the BBC fend for itself with advertising, subscriptions, pay-per-view and whatever other ways it can find of earning itself a living in the marketplace.

Of course this is possible, but every study has shown that the result must be a serious impoverishment of television in Britain. Subscription and pay-per-view could not begin to replace the missing £3 billion, and advertising, apart from not generating enough income, would also seriously diminish the advertising revenue and consequently the production budgets of the commercial broadcasters.

I cannot see any government taking £3 billion out of broadcasting and not expecting a national outcry and a dramatic loss of votes. The free market may, and in my view should, be the ultimate destination, but it is neither desirable nor practicable to head for it immediately.

Before we can construct a realistic plan to save the BBC we have to confront another ancient assumption, that the BBC has to provide a total broadcasting service.

Like all myths this springs from a long-forgotten fact. The BBC I joined in 1955 did indeed have an obligation to cover every aspect of British life and satisfy a wide range of demands and tastes. News, sport, music, drama, comedy, current affairs, education — if the audience was to find them on radio or television in the monopoly era, they could only find them on the BBC.

That had been the case for 30 years, and the arrival of ITV did not change it. Indeed it is still buried deep in the soul of the corporation. But the massive increase in channels over the past 15 years means that many of the viewers’ and listeners’ requirements are satisfactorily met elsewhere. A varied programme may well make sense from a purely broadcasting point of view, but it does not justify expenditure on programmes viewers can get from other sources, purely from some delusion of national obligation.

So what should the BBC not be doing? Do we really want it to enter auctions against the commercial stations for Hollywood movies, American television series and national or international sporting events? If the audience is going to see them on television anyway, why spend their licence money just to enable them to see them on a different channel?

Then there are the endless space-filler programmes: cookery, gardening, DIY and so on — if the BBC’s were significantly better than anyone else’s they could be justified, but if (as is so often the case) they are just there to fill space and save money, and are virtually indistinguishable from competitors, why bother?

And do we still need Radio 3? No one questions the excellence of some of its output, but it costs almost twice as much as Radio 1 for a fraction of the audience, most of whom have a rich library of CDs. And does it need to spend £28m on supporting five house orchestras and a choir? They are certainly not value for licence money. If the government wants to support them, the Arts Council can pay.

While Radio 4 is a unique speech channel, do Radios 1 and 2 provide programmes sufficiently different from what listeners can receive from commercial stations and through their iPods to justify their £40m a year? Is BBC local radio really necessary? The question is not whether the programmes are good, but whether they are value for licence money.

Even more important is the question of the new digital television channels. Clearly the BBC was under considerable government pressure to lead viewers to install digital terrestrial receivers to help the phasing out of analogue transmissions.

This may help the government and the industry, but it would be hard to argue that it gives £325m worth of value to licence payers. As digital becomes established, it is time for the BBC’s digital channels to make their excuses and leave.

And then there is educational television. When I saw the first domestic video recorder back in the 1970s I prophesied that schools broadcasting would be dead in 10 years. That was about 30 years ago and it’s still there.

Why? Schools and colleges do not want to arrange their timetables to fit round broadcasters’ schedules when they have audio and video tapes, CDs, DVDs, CD-Roms and the internet that they can access when it suits them, and the range of commercially available educational material for schools is huge and growing.

So having saved the BBC getting on for a billion pounds a year, how are we going to ask them to spend it? There are two fundamental changes to be made before we start.

The first is a spiritual conversion. For 80 years the BBC has seen itself as a provider of services — “a unique institution”, “historic role”, “world’s greatest broadcasting service”, “cultural beacon” .

All that has to go. The corporate imperialism and institutional self-regard are now a millstone. Instead it must relegate the service provider to a subordinate position and place the professionals, the programme producers, on the throne. It must seek respect not for what it is but for what it does. It must measure its success as the public have always measured it, by the quality of its programmes.

The second fundamental change is in focus. The principal reason why so much of the BBC’s output is so undistinguished is lack of money. Its resources are too thinly spread over too many channels. Obviously it must keep a mainstream television channel (though not necessarily all night) and a radio speech channel. The World Service is paid for by the government, so is not a drain on the budget.

What other services? There will of course have to be a news department to supply BBC1 and Radio 4; anything beyond that will be up for discussion. The irreducible minimum, however, is one television and one radio channel.

What is required is in many ways similar to the Jackie Fisher reforms of the Royal Navy. In 1904 Admiral Sir John (later Lord) Fisher became first sea lord. He took over a navy that for the previous hundred years had been defending the British Empire across all the world’s oceans.

Fisher realised that its job had changed. There was now only one danger that mattered, the German high seas fleet, and only one objective for the Royal Navy: to defeat it. He saw no need to keep a gun boat in every creek around the South China Sea, or half a dozen frigates for social or diplomatic purposes in every port from Mombasa to Hong Kong. He needed dreadnoughts, and he built them, and at the same time dramatically cut the naval estimates.

The BBC’s threat is broadband, and the loss of its licence revenues. Its dreadnoughts are high quality programmes. Should certain categories of programmes be excluded — quizzes, panel games, reality programmes?

No. The audience does not want to be denied the likes of Mastermind, The Apprentice and Have I Got News For You? It is absurd to prescribe or proscribe categories. Quality means the “best of its type”, not the “best type”, whatever that would be.

And how do you define quality? Management researchers spent years investigating and debating this, and only one definition made any sense or gained general agreement: quality is what the customer wants. High quality is what delights the customer.

The BBC’s remit is to produce a volume of high quality programmes, and with a much reduced output its long tradition of producing fine programmes and a budget of £10m a day, it should be able to achieve it triumphantly. We could see a golden age of drama, comedy, documentary, children's television and arts and science programmes. It would be a great production powerhouse, enriching television for all the nation’s viewers.

There is one other obligation that must be laid on the new BBC: it must be committed to making as much money as it possibly can, and cutting out all its ancillary activities — BBC Resources, BBC Online, Publications — unless they can contribute profits to go into programmes.

The BBC is a powerhouse, but it is also a treasure house. Its sales of programmes reached £700m in 2004-5, with profits of £55m. With much more professional and aggressive marketing — qualities it is rarely accused of — that sum could be increased dramatically.

The new focus on quality production — quality in quantity — should provide a large and growing increase in programme sales. The worldwide market for high quality programmes is expanding all the time: sales of programmes, leasing of formats, sales of CDs, DVDs, books, magazines — and quite apart from programme sales, its supplying of resources such as studios, outside broadcast units, editing and dubbing facilities, wigs and costumes brought in £7m profit last year.

But the great resource is the rich library of television programmes; the 20th century was the century of the franchise holder but with the massive increase in digital channels and DVD sales the 21st century is the century of the copyright owner.

I know this from personal experience. My income (in money terms) from Yes Minister and Yes, Prime Minister in 2003-4 was getting on for double what I earned from all the 38 original scripts put together. With the market growing all the time and an increased injection of new high quality programmes, this source of income could be enormously more significant than most people now realise.

It is significant because of the final question: what happens to the BBC when viewers receive all their programmes on broadband? If it can no longer depend on the licence fee, does it just wither away?

It could take advertising and become just another commercial channel with hugely reduced revenues. It could run a pay-per-view business. But the odds must be on its becoming another subscription channel. However, if it could supplement its subscription income with hundreds of millions of pounds of programme sales revenue, it could be in there with a chance.

This may all seem like an attack on the BBC; in fact it is the opposite. As a producer of programmes it is and has always been a tremendously important contributor to the leisure life of the nation, and especially of those who cannot afford many other leisure activities. Like the commercial channels, it has ensured a constant supply of good home-made programming, and unlike them it has not had to skew its output towards the needs of advertisers — for example their demand for younger viewers.

It reflects life in this country in a way not possible for American series, however excellent, and provides a forum for the British people to talk to each other. And if the quality is high enough, the long-term earning potential of its most popular programmes is vast: classics from 20, 30, or 40 years ago like Dad’s Army, Steptoe and Son, The Forsyte Saga, Miss Marple, Civilisation and Life On Earth are still filling the BBC’s coffers while enriching the cultural life of the nation.

It would be a great pity if in the future the BBC could no longer afford programmes of this quality. The tradition and the skills are all there — for the moment. The licence fee must be kept for as long as it can be justified and collected.

We have about 10 years to reshape the BBC (perhaps into a new British Broadcasting Trust?) so that it can continue to use those skills and draw on that tradition to maintain a stream of high quality programming after the licence fee has gone.