More for less 

17 January 2022


I recently came across yet another Facebook invitation to join the campaign to scrap the TV Licence. I usually skip past these campaigns on the grounds that, well yes, it would be nice not to have to fork out £157.50 or thereabouts each year, but the alternative of putting up with adverts on every channel and the inevitable lowering of standards are just not worth contemplating. Then I noticed that this particular version of the campaign was being fronted by Sky TV and it just got me thinking.

You see, the argument goes that if the BBC took advertising they could easily drop the licence fee. Alternatively the BBC could be funded via a subscription. While the argument often fails to contemplate the detrimental effects this will have on the other broadcasters it overlooks one major factor which should be fairly obvious but no one seems to question.

The most basic Sky package (as in TV only) comes in at £25 per month for new customers, usual price being £31. This comes in at £300 per year or £372 at the “usual” price. At its cheapest it’s twice the price of the regular TV Licence which you still have to pay anyway. Sky has a huge customer base across the UK and beyond so we know they’re not short of a bob or two. But, despite making megabucks from their subscription service their programmes still carry advertising. Have you ever wondered why that is, in fact, have you ever even thought about it? Surely, if the model that Sky (amongst others) are proposing for the BBC, that the corporation should drop what is effectively their “subscription” and become funded by advertising alone, if that proposal really is a workable one then why does it not seem to be workable for Sky? Surely Murdoch’s TV network should be able to exist solely on advertising revenue or solely on subscription. So why does the rich and mighty Murdoch network need both? Why are so many of you choosing to pay twice the price of a TV Licence to watch TV with adverts?

Sky subscribers will instantly point to the huge number of channels available to them, 388 so I’m told on the basic package. But of that 388 many are ‘+1’ services, several are HD duplicates. Then we come to the regional variations of the public service channels, the sign language versions of the same, the foreign language channels and the radio channels. This still leaves a hefty amount of watchable channels but, in reality, how many of them do you actually watch? I’d suggest in the great scheme of things the answer is relatively few and I’d bet that some of them are the ones showing old BBC shows (which you’ve already paid for with your TV Licence) now with commercial breaks shoehorned into them.

Of course, the same question can be asked regarding the BBC channels and it’s true that you may have never watched BBC Parliament or BBC Alba, but services such as those are part of the public service remit to which the BBC is committed and which, along with the likes of BBC Four and the local radio stations would simply have to be cut in a commercial environment. That £157.50 is your permit to watch ITV, Channel Four and Channel Five and their ‘add on’ channels as well, pretty much in the same way that your annual road fund licence allows you to drive your car on any road in the UK, many of which you will never use. At twice the price the Sky subscription provides you with around ten times the amount of channels that you will probably never watch, so in that capacity I suppose it does provide some value…

It can of course be argued that the subscription is there to cover the cost of the receiving equipment but I’m not even fully convinced about that. Sky will tell you that the box remains their property and that, of course, is where they’ve really got you. They can provide you with the cheapest and nastiest box they can lay their hands on, you have no choice in the piece of kit you’re lumbered with. The current Sky Q box certainly has a build that feels as cheap as it looks and definitely feels that way in operation. I’d reckon that you will have more or less paid for the box and the dish around the end of your first year’s subscription so the logical thing to do here would be to reduce your monthly payment, but of course, that doesn’t happen.

So how do Sky justify charging a hefty subscription fee in addition to carrying commercials during their programmes? Subscriptions for their premium movie and sports channels yes, I get that… sort of… but certainly not for their bog-standard service. ITV don’t do it and they’re the ones who stand to suffer the most in the event of a commercial led BBC, for while ITV still regards BBC1 as their fiercest rival as far as viewing figures are concerned, it’s the likes of Sky with its huge customer base that ITV has to tangle with for selling premium advertising slots. Ironically ITV have usually been among the most vocal in opposing the abolition of the TV Licence mainly because the last thing ITV needs is a second major rival fighting for advertising revenue. Like it or not, BBC1 can pull big audiences with the likes of EastEnders, Strictly…, Silent Witness or The Apprentice and given the chance they would pull advertisers with them, away from ITV who would have to come up with some real competitive deals to retain them.

For the first time since 1955 ITV would be competing for advertising sales against the BBC, a rival of equal strength both in programme terms and in audience figures and both networks would take the hit really badly. Programme wise across both channels we’d be likely to see the type of ‘dumbing down’ that occurred on ITV in the late nineties when it found itself up against Sky as a commercial rival on the new digital platforms. This saw the consolidation of ITVs once proud regional services into a single network and the loss of much of its public service remit. Channels Four and Five would also feel the squeeze, C4 already having been forced to drop much of their niche programming since having their umbilical cord with ITV cut in the ‘nineties and subsequently selling their own advertising slots. Bring adverts onto the BBC and just watch Channel Four go total mainstream. It must also be remembered that the BBC as a programme maker and broadcaster is not the only recipient of the licence fee, the transmission of the Freeview and Freesat services along with the Welsh broadcaster S4C and the UK Broadband Rollout are all funded from your £157.50.

Maybe the Sky model is actually realistic, that funding by advertising alone isn’t feasible after all. Proof of this lies abroad where in many countries all the networks carry advertising but a licensing system still exists to subsidise the broadcasters and the various back up services. Some such as Greece and Italy put it as an additional charge on the electricity bill, some charge it as a Broadcasting Tax, collected as part of their version of the council tax and charged regardless of whether one owns a TV or not, while Turkey includes it as part of the purchase price of a TV set itself followed by an additional two per-cent on the electricity bill. Some countries such as Austria and Poland charge for a separate radio licence, something which is incorporated into our TV Licence while Norway collect it through a compulsory income related tax of up to £153 per person. There really is no such thing as the free lunch. In fact some of the examples here come in at a higher price than what we’re paying in the UK and let us not forget that the only requirement here to pay the licence is on the condition of ownership of a TV set.

Of course, our friends at Sky won’t actually acknowledge this because secretly they’d love to see the end of traditional public broadcasting in the UK. It’s quite likely therefore that the Sky subscription is actually their version of a TV Licence and that the whole system is unworkable on advert breaks alone. But if that is not the case, if the Mighty Murdoch corporation feels that the BBC along with the rest of our public broadcasting networks really can survive together in a totally commercial environment without a drop in programme quality, then maybe it’s time for Sky to do the decent thing, lead by example and abolish their annual subscription.


A Transdiffusion Presentation

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3 responses to this article

Zaph Camden 19 January 2022 at 9:42 pm

“Mighty Murdoch corporation?”

Might want to update that line. None of the Murdochs have had anything to do with Sky for years. News International sold their entire shareholding in 2018, and Sky is now 100% owned by Comcast.

Darren Hayward 23 January 2022 at 10:47 pm

Murdoch is now returning to British TV through the TalkRadio brand with a new channel called TalkTV which is launching in March

Tony Brogan 23 February 2022 at 7:50 am

“let us not forget that the only requirement here to pay the licence is on the condition of ownership of a TV set.”

That is the condition in the Republic of Ireland, it is not the requirement in the UK of GB&NI.

In the UK of GB&NI the requirement is that operation of a device for the reception of video as it is being broadcast (terrestrial, satellite, cable or of the same being distributed live via the Internet) must be a LICENCED device ie covered by a valid TV License for that particular address (or individual rooms in a building divided into separate premises).

So just because you own a TV set in the UK of GB&NI does not mean you have to have purchased a licence, but if you operate it for the purpose of reception of video, you need to have purchased a licence.

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