BBC Challenged to “Take More Risks”

LONDON: While the BBC’s annual report was generally upbeat, it did include a warning that viewers had identified a “performance gap” between the type of innovative programs that audiences are expecting and what is actually being delivered.

“Those viewing BBC television are increasingly rating it as ‘fresh and new’,” the BBC Trust said in a report published today. “However, there remains a performance gap in the public’s broader view of the BBC in this respect and qualitative research we undertook for Charter Review suggests that there is still a public appetite for the BBC to take more risks in its programming and offer more original and innovative content.”

BBC One remains the most-watched channel in the U.K, as 72 percent of people tune in each week, down slightly from 73 percent last year and from 78 percent at the start of the Charter in 2006-07. Among the channel’s notable programs, The Great British Bake Off, Strictly Come Dancing and Sherlock all achieved audiences of more than 10 million.

BBC Two was watched by 46 percent of people each week this year, down just slightly from the 47 percent last year, but by a greater extent during this Charter period from 57 percent in 2006-07. BBC Four, meanwhile, saw an average appreciation score of 83 and with 84 percent of viewers agreeing programs are ‘fresh and new’, the highest for any BBC channel.

As part of its cost-cutting measures, the BBC reduced the number of senior managers and their cost this year. The senior manager paybill is now £47 million ($61 million) as compared to £78.5 million ($101 million) in August 2009. The total number of senior managers is 356—45 fewer than last year and 279 fewer than 2009. The Delivering Quality First savings program delivered £621 million ($806 million) sustainable savings by March 31, 2016. The program remains on track to deliver an annual total of £700 million ($909 million) in annual recurrent savings by March 31, 2017. As of 2015-16, 94 percent of the BBC’s core controllable spend is now spent on content, distribution and related support, with only 6 percent spent on running the organization. The BBC will need to save an additional £800 million ($1.04 billion) by 2022. This is partly due to the impact of the licence-fee funding settlement reached with the Government in July 2015, but also to fund super-inflation in areas such as sports and drama, and the cost of the new Charter proposals.

The BBC’s total income of £4.83 billion ($6.36 billion) was up from the £4.81 billion ($6.25 billion) in the previous year. That included license-fee revenue of £3.74 billion ($4.92 billion), about 0.2-percent above last year. Total operating costs declined from £4.9 billion ($6.36 billion) to £4.8 billion ($6.32 billion).

Rona Fairhead, the chairman of the BBC Trust, said: “This year, the BBC has delighted, engaged and informed audiences with high-quality and distinctive content, while continuing to drive down costs, although reaching younger audiences and those in all the U.K.’s nations remains an important challenge. The public have been clear they want a strong, independent BBC and they have no appetite for fundamental changes to it; their views must be reflected as the new Charter is finalized, and the new BBC Board must ensure that the public’s voice continues to be at the heart of decisions.”

BBC Director-General Tony Hall commented: “This year we’ve had some wonderful successes on-air with programs like War and Peace, The Great British Bake Off, BBC Music Day, The Night Manager and our news coverage of the General Election. Off air we’ve made progress in making the BBC a simpler and leaner organization that focuses more of our spend on making content. Next year I want us to go further and build on the stability a new charter gives us to serve the whole of the U.K. with programs that are distinctive, innovative and trusted.”

Commercial arm BBC Worldwide, meanwhile, reported a full-year profit of £133.8 million ($176.3 million), down 3.5 percent from the previous fiscal year. Underlying profit was up 4 percent, excluding the effects of the sale of a stake in BBC America. BBC Worldwide revenue of £1.03 billion ($1.36 billion) was up 2.8 percent year-on-year, or 6.7 percent in underlying growth when adjusted for the partial sale of BBC America. BBC Worldwide returned £222.2 million ($288.7 million) to the BBC, up 17.6 percent year-on-year adjusted for dividends relating to disposals.

Tim Davie, the chief executive of BBC Worldwide and director of global, said: “This year’s results are due to strategic focus and exceptional content, creatively commercialized. Despite operating in an increasingly challenging environment, we have held onto our ambition to transform the business, deepening our unrivaled content slate, while increasing our support to the BBC and the wider U.K. creative industries. All these elements played their part in delivering a good set of results and ensuring we enter the new year from a good place.”

Davie added: “In the year ahead, audiences across the globe can look forward to a raft of stunning titles including the long-awaited return of Planet Earth II this autumn, Doctor Who spin-off Class, SS-GB and the fourth series of Sherlock. Fans of British content in Singapore will also be the first to enjoy BBC Player later this summer and later this year we will launch our first OTT proposition in the U.S.A.: two projects that build on our ambition to expand the ways in which we deliver premium content to our audiences.”