The Gist: The Road from Perdition

This week has seen some memorable moments. The unravelling of RTE’s management like a ball of twine being played with by particularly attention-seeking kittens will stand out in the mind long after mundanities such as your offspring’s birthday party or a failed Russian coup.

The reason that RTE’s travails have so gripped the political and public imagination (and no conversation throughout the land this week has been complete without some disbelieving reference to it) is that it suddenly reveals a thing which has been in public view all along, but never acknowledged. RTE is a Public Service Broadcaster, except when it is behaving like a commercial broadcaster. And those two roles, and ways of behaving, and broadcasting outputs and styles are mutually exclusive.

Early in the week, everyone was saying the same thing- that no matter what happens next, RTE can forget any reform of the licence fee for years.

But as the week wore on, and the news and current affairs part of RTE made significant efforts to meet the public service part of the station’s promise, something new appeared. Politicians and academics began saying the unsayable- it was time to take steps to separate the commercial and public service strands from the station’s culture and funding.

So, as a bit of a change, let’s look at how they could do it.

One Weird Trick

RTE has three main structural problems.

1. It is starved of cash.
2. As we learned this week, its commercial arm has been operating directly contrary to its public service remit.
3. It hasn’t created any sort of a digital future for itself, so its audience is aging into the grave.

You can fix all three things with, as they say on the internet, one weird trick.

You simply stop taking ads.

All commercial pressure vanishes. Advertising ‘clients’ are not being entertained to public scandal at a cost of 100s of thousands of euro, because there are no advertisers. All the money goes to the business of programming.

As everyone who has ever tried to use it will tell you, the RTE Player, the supposed digital platform for the future of public service broadcasting, is a pile of steaming dung unfit for any purpose. And, having spent a number of years looking for (and even sometimes getting) FOIs on RTE’s digital strategy I think I can simply explain why with a little quote from now-resigned DG of RTE, Dee Forbes. In 2019, Ms. Forbes went to the Oireachtas and faced a number of questions about the generally hopeless state of the RTE Player.

She responded by illuminating the RTE management position around people using the internet to access its programming.

“11% of households, and the figure is growing, do not pay the television licence and yet can consume public service programming on their online devices…This lag in legislation is resulting in a further loss of €20 million in public funding annually.” https://www.kildarestreet.com/committees/?id=2019-12-10a.175#g176

In addition, the player can only generate pennies to the TV and radio Euros in advertising monies. In 2020, RTE’s total commercial earnings were €134.5 million. But out of that, only 4.9 million was made selling those infuriating Player ads.

When you see every person using your internet system as costing you both public and ad money, of course you don’t spend any cash on making it work. You’d drown it in a sack if you could. Change that, and you create an actual incentive to solve RTE’s platform and audience problem.

But, you may say, ads contribute nearly 50% of RTE’s revenue. Wouldn’t scrapping them be instant disaster?

Well, before we answer that, the next thing I propose is to abolish the license fee too. The future of media commission proposed this as a half measure last year. But they still wanted to keep the ads. However, we’re not worried about limiting ourselves only what’s going to be politically popular. We’re actually trying to fix problems here. We’re also not going to replace the licence fee with the moronic Broadcasting Charge either.

The licence fee is an absurd and indefensible means of raising funds. It is regressive, inefficient and coercive. Its only excuse on introduction was that TVs were a luxury good only possessed by the very rich, who ought to pay for the programmes they got to watch using their fancy black and white sets. Now TVs are ubiquitous, and public service broadcasting is acknowledged, and has been acknowledged all week, as being of critical importance for society as a whole.

Having now wiped the slate clean, we’re ready to propose something new.

Here comes the science bit

RTE should be funded from central exchequer funds, at a sum fixed as a proportion of the tax revenue generated each year.

This would allow it to save for the lean times, and to also invest when the economy allowed for it. If tax take went down, the money going to public service broadcasting, (which is mainly RTE) would go down too, automatically.

We would do it this way, because timing funding to a formula to exchequer funds, as opposed to allowing a minster to decide the funding on a year to year basis will reduce the risk of political interference. It ought to come with a review of the appropriate percentage at a set time period- say once a decade.

This would offer editorial independence akin to the 10 year BBC Charters, but be more responsive to the wealth of the nation in the interim.

The chart below shows the effect this would have had on RTE’s finances since 2016. While the actual income has remained stagnant under the dual licence fee and advertising model (green bars), funding of, by way of example, less than three quarters of one percent of net tax revenue (0.7% in the blue bars) would have seen RTE’s funding woes abolished.

At the same time, the commercial sector would have seen its main competitor for advertising simply leave the market. The money available for other commercial media could also be expected to rise.

And all without a single IRFU season ticket bought for advertisers.

A true public service broadcaster, incentivised to invest for the digital future is what everyone says they want to see. It has been the yoking of advertising and commercial interests to that public service broadcaster from the start that was the original sin of Irish broadcasting policy. It was the source of the Tubridy top-up payments, as the terror of losing the money brought in by the star presenter in advertsing and sponsors drove the "intention to decieve".

We shouldn’t waste a good omni-crises.

It’s time we set up the only structure that will ensure that RTE’s management stop seeing advertisers as its clients, and be willing and able to deliver the public service Ireland needs.