Public Broadcasters and the Looming Crunch

The topic of today’s post will seem a bit foreign to a lot of this blog’s readers for the simple reason that the United States doesn’t have a state broadcaster in the traditional sense. Yes, PBS (and NPR) are public broadcasters, but their funding model is a complicated one. Funds come from a variety of sources including corporate and private donations, sponsorships and indirect government funding. In stark contrast, many public broadcasters around the world are subsidised by direct taxation; often in the form of a TV license.

The Crunch

What has been noted in recent times is the fact that TV licenses generally only cover televisions (with some exceptions). You and I know, however, that a lot of content is also watched on computers and mobile devices; notably exempt from TV licensing requirements. That places broadcasters in a crunch; people are not buying TVs like they used to and license revenues (and by extension, their funding) are falling as a result.

The reason this blog is discussing the entire saga is that state broadcasters, particularly in Europe, not only create, but also purchase and commission large amounts of animated content.

The Pessimistic View

Consider if TV license (or similar) revenues continued to fall. State broadcasters would trim back their spending on new content, given that they have less money with which to play with. Such a reduction would not only hurt those studios that make content explicitly for such entities, but also those studios that create content independently and sell it to public broadcasters through the open market.

Even the US would not be immune to the effect. While there is naturally a greater choice of content on this side of the pond, there remains a large contingent of content that is purchased from overseas. Kinks in this supply chain could have negative (and positive) impacts on animation broadcasting there. Likewise, many European broadcasters purchase US-made content for local broadcast and fewer resources would endanger those actions.

Undoubtedly, the notion that animation production in Europe an elsewhere could be in trouble runs contrary to how it should be. The problem is that countries such as the UK are attempting to make animation more appealing to outside sources at the very time they should be refocusing on internal sources. The UK could make itself a very cheap place to make animation, but if the majority of the sources of the production budgets run into difficulty, being cheap won’t matter; no-one will do it for free.

The Optimistic View

Some states (such as Ireland, regrettably) have considered placing a non-descriptive ‘broadcast tax’ on either every residence in the state or on device sales within their borders. The outcome of this is intended to shore up public broadcasters’ revenue sources. The problem is that this is out of place with the shift to digital platforms. Revenue levels may be maintained, but they do so at the expense of the free market.

A TV license is one thing because it burdens those who are most likely to reap the benefits of state-sponsored content. A flat tax on the general populace however, acts as an incentive to no-one and does not promote production of better content.

The role model to follow in all of this is the BBC, an institution that has undergone a remarkable transformation over the last 10 years. While still funded by a TV license, the corporation has done remarkably well to market and sell its content in markets around the world, bringing in much additional revenue.

State and public broadcaster therefore need to redouble their efforts to make content that can be sold across borders. Some do so already and the vast majority of independents cannot comprehend doing anything else; their margins are too thin. With marketable content, state broadcasters can be sure that their content and the content they commission is self-supporting and possibly even revenue-generating. By doing so, they mitigate the crunch that comes from falling TV license issues and maintain production at the current levels.

The Long-Term View

If one is to look at the situation from a long-term perspective, public broadcasters are rapidly approaching the point where they will be forced to play on a level playing field with private producers. The internet doesn’t discriminate between content sources and just because public money funded one show, doesn’t mean that anyone will actually watch it. Yes, state broadcasters are tasked with producing content that would not otherwise be profitable, but the internet will take up some of the slack as independent producers proliferate. State broadcasters may create niche or acute-interest programming, but if they get too far from the mainstream, they run the risk of being accused of wasting public money.

Thankfully, animation rarely if ever is seen as a waste of public money, and it would be real shame if that ever came to pass. That said, state broadcasters must consider the changes we are currently seeing. Animation studios and those who run them would be wise to consider them as well, and plan accordingly.

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