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“Does Britain really want a vibrant ideas industry, and if so why are we drifting inexorably towards a second-rate digital television world?”
So what will Mrs. Williams find when she switches on her box? Will she find an exciting New World of creative possibilities to liven up her Wiltshire existence? Will she channel hop between jewels, finding new meaning to her previously narrow analogue- grounded existence?
I fear that Mrs. Williams will be dis- appointed. Provided she pays the equivalent of three licence fees, plus her BBC licence, she can now watch a lot of repeats and American films. She won’t find much of interest on the four competing “youth” channels, BBC 3, E4, Sky 1 and RTL 2; or on the three “boys toys” channels, Men & Motors, Tech TV and Bravo; or on the six competing sports channels.
True, for Mrs. Williams there won’t actually be less to watch – all her favourites will be there – but to find them, she will have to switch between BBC 2, BBC 4, Channel 4, Discovery, National Geographic and the History Channel. Thank God for Countdown, even though it now has four commer- cial breaks during its 22-minute dura- tion (in 2002 the ITC agreed to allow 15 minutes of advertising per hour to bring Britain in line with the rest of the international television market).
Is this what we mean by the digital revolution? In 1996, I gave the RTS Fleming Memorial Lecture entitled “57 Channels and Nothing On”. I was accused of whingeing. Earlier this month Rupert Gavin gave his Fleming on the subject of “The Eureka State” – he also expressed real concerns about our creative economy.
Does Britain really want a vibrant ideas industry, and if so why are we drifting inexorably towards a second- rate digital television world? It’s rather a relief that Britain lies 21st in the league of countries with broadband connections – nobody has any idea what to offer people to download. Quite frankly, television has not yet woken up to the most exciting new challenge since the start of ITV.
I’m not actually sure that the Government knows what a creative industry really is. In the past, they thought it was synonymous with the broadcast industry, now I sup-
pose they think it’s the same as the broadband and digital televi- sion industry. It’s naïve to believe that simply by creating a digital environment, the content will magically appear.
That’s a bit like manufac- turing Game Boys before the
invention of the computer game. For the next three years only, Britain has a unique chance to position itself as Content City. To do so, it needs a fun- damental shift in the relationship between creatives and distributors (in whose number I include broadcasters).
Take copyright, for example. It’s been a fundamental law of doing busi- ness as a producer that the broadcaster owns and controls not only the pro- gramme you make for them, but also the underlying rights in the designs, patents, and all exploitation of those rights.
Now that would be fine if the broad- casters had been paying a proper margin to its suppliers, but because broadcast- ers have licences to trade as monopo- lies, they’ve only paid producers a 10% gross margin for their ideas, out of which producers have to fund both cen- tral overheads and development - even the waiters at The Ivy get 12%.
And it would be fine if the broad- casters were prepared to properly fund all producer development costs - what broadcasters call development is the odd script and a bit of research, and what we call development is the sweat and tears and years of no income while we come up with the next Big Idea.
British broadcasters are, frankly, control freaks – blinded to the possibil- ities which genuine partnerships with creative communities could bring them. It’s no coincidence that four of Britain’s five biggest selling overseas formats: Who Wants To be A Millionaire?, Have I Got News For You, Survivor and Robot Wars were created, and are owned and controlled by inde- pendents. Despite their attempted stranglehold over rights, broadcasters can lay claim to only one international hit format – The Weakest Link (aptly).
I uncovered a fascinating quirk of BBC policy the other day. Apparently there’s a rule that BBC-owned brands (i.e. brands created by independents, controlled by the BBC) must not be sold into the UK secondary market place until five years after the end of their BBC life.
What possible use can this rule have except to artificially depress the value of programmes and to deny to
the digital market a stream of valuable secondary program- ming, and the independents who did all the work the chance to make a margin on the deal? All to preserve a “BBC brand”.
This state of affairs is not only unfair, and the Office of
Fair Trading still stubbornly refuses to take action over what is a blatant abuse of market dominance; it is at the very root of our creative dilemma. The creative television industry needs investment, and for this investment the City needs returns. In the 1840s, Britain’s railway network was built with a real vision – and capital to match that vision. How those Victorian pioneers would have laughed at our efforts to create this new industry of ideas.
Producers and broadcasters should now be in active dialogue to solve a real dilemma: how do we build our Content City in just four and a half years?
What worries me, and it should be worrying the Government, is that we haven’t even begun to discuss how to lay the foundations. We need first to construct a model that allows the coex- istence of two similarly profitable parts of the same industry: platform owners and content providers.
These two players will be utterly dependent on each other in the future. There needs to be a massive invest- ment in research and development to create new content – funded by the incentive of real profits. The pro- grammes we create will become the brands that drive the digital economy.
And if we, who have already demonstrated that we do it best, own, control, and sell those brands, we’ll have taken the first steps towards lead- ing Britain into a new, ideas-driven, age.
I’m very lucky. I go to work each day with a small band of immensely creative people who together represent an incredibly valuable asset base. Together this group of creatives has won scores of international awards, produces hundreds of hours of broad- cast television for all the major chan- nels, and still manages to turn a profit at the end of the year.
How does the digital revolution affect them? The answer is, not as much as it should; not as much as Britain needs it to.
OK, so producers know they are at the bottom of the media food chain. We’ve always been the worms crawling around the broadcasters’ feet. But remember, time is on the side of the worms. ■
Tom Gutteridge is Chairman of the Mentorn Group and a Director of The Television Corporation PLC
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