Yahoo Finance BBC told to explain increased spending on US blockbusters
The BBC has been asked to explain why it spends taxpayer money on Hollywood blockbusters rather than “at risk” arts and children’s programmes by the broadcasting regulator.
Ofcom said the BBC must disclose how its acquisitions of US films and TV shows support its obligations as a public service broadcaster, as opposed to commissioning original UK programming.
The intervention comes after ITV complained that the BBC had “dramatically” increased its spending on American imports in recent years.
It pointed to deals for blockbusters such as Marvel’s Avengers Assemble and Disney hit Frozen, as well as buying “first look” rights to shows including The People vs OJ Simpson and American Crime Story.
ITV said the trend “sits uncomfortably with its [the BBC’s] mission to be distinctive and take creative risks”.
“The BBC has guaranteed public funding and is therefore protected from the vicissitudes of market fluctuations. As a result, it can take more risks and doesn't need the cushion of mainstream acquired content to do that,” the broadcaster said.
“As a result, it is somewhat jarring to see the extent to which acquired content drives the BBC’s content strategy.”
ITV added that the BBC’s acquisitions risked inflating the price of content for other broadcasters.
Buying US films and TV shows is considered a safe bet across the industry, as US viewing figures give a good indication of their success in the UK.
But the BBC’s £3.8bn in licence fee funding from taxpayers means it has a requirement for “distinctiveness” that sets it aside from commercial rivals.
ITV said the BBC should instead focus on foreign acquisitions that take creative risks, such as Scandi-noir series The Killing and Borgen.
While Ofcom said it did not think acquisitions played too large a role in the BBC’s output, it set out new requirements for the broadcaster to report on acquired shows in “at-risk” genres, including arts and music, religion, comedy and children’s programming.
The regulator said: “We agree with stakeholders that there needs to be greater transparency from the BBC on its overall approach to acquisitions.”
The BBC said its spend on acquisitions was only a small proportion of its overall budget and that it was the largest producer of originated programming in the UK.
The crackdown forms part of a wider overhaul of BBC regulation under a new operating licence due to come into effect next month.
Ofcom has given the green light for the BBC to cut back its regional and national TV news output as it looks to expand online.
Other changes include a reduction in BBC Four’s quota for original productions to 65pc and lowering Radio 5 Live’s news and current affairs quota to 70pc.
The changes have sparked a backlash from commercial news organisations, who have warned of a growing encroachment into local news coverage.
Owen Meredith, chief executive of the News Media Association, said: “The update of the BBC operating licence is a missed opportunity for Ofcom to place clear guardrails around the BBC’s impact upon commercial providers, particularly local news media providers.
“Instead, the BBC has been given a free pass to expand its offering, using the licence fee to compete directly with commercial providers, to the detriment of our wider media ecosystem and contrary to the recommendations of the Cairncross review.”
Under the terms of the new operating licence, Ofcom will also tighten its reporting requirements amid concerns about a lack of transparency over BBC cuts.
Kevin Bakhurt, Ofcom group director, said: “We’ve been particularly disappointed by the BBC’s lack of detail and clarity around planned changes to its services, which has led to a lot of uncertainty for audiences and industry.
“Our strict new reporting rules will ensure the BBC is held to a higher level of public accountability, requiring it to clearly explain its plans before going ahead, as well as evaluating whether they work.”
A BBC spokesman said: “We welcome these changes which reflect the need for the BBC’s regulation to evolve for the digital age so we can best serve all audiences with impartial news and distinctive UK content in a fast-changing global market.
“We are committed to transparency and will set out how we plan to deliver for audiences in the year ahead in our upcoming Annual Plan.”
