Digital Economy Bill

Viscount Colville of Culross Excerpts

Committee: 2nd sitting (Hansard - continued): House of Lords
Thursday 2nd February 2017 Lords Chamber

[The Deputy Chairman of Committees (Baroness Garden of Frognal) (LD)]

I must advise the Committee that if Amendment 73 is agreed to, I cannot call Amendment 73A by reason of pre-emption.

[Viscount Colville of Culross (CB)]

My Lords, I declare an interest as a director and producer of television programmes for public service broadcasters. I have put my name to Amendments 73 and 235 because I want the public service broadcasters in this country to benefit as soon as possible from the repeal of Section 73. I also support Amendment 73A, which seems a very sensible use of any money the PSBs might garner. The question of whether there should be a transitional period after the repeal of Section 73 seems to revolve around the issues of whether underlying rights need to be worked out as part of the retransmission negotiations and whether it will take time to introduce a new structure for negotiating licensing arrangements between PSBs and cable providers.

At the moment, all channels, including the PSB channels, routinely buy the rights for “traditional” cable retransmission if they anticipate content being carried on cable, so rights should not be a problem. Therefore, any negotiations will focus on the licensing arrangements between the PSBs and the cable providers. As there is already a structure in place for the licensing arrangements of the PSBs’ non-core digital channels, this surely cannot be an excuse to put off the introduction of a similar framework for the core channels the moment Section 73 is repealed. I, too, am saddened by the extraordinary amounts of money that seem to be made by the streaming catch-up websites, such as TVCatchup and FilmOn. The litigation appears to suggest that millions of pounds has been made by these websites and therefore lost by the PSBs. The sooner we can stop that loophole, the better.

There is a genuine need to give extra financial support to the PSBs in this country. As the noble Lord, Lord Clement-Jones, said, they are the major customers for original UK content in all genres. They are threatened by the success of BSkyB and, in the BBC’s case, threatened with a 20% cut in funding as it takes on the burden of the concessionary TV licence fees. The noble Lord, Lord Clement-Jones, said that huge amounts of money would not be made by the repeal. However, the 2013 NERA report in the US noted that the free-to-air American broadcasters received $3.3 billion in retransmission payments, while the fees accounted for less than 3% of the cable operators’ cost. Therefore it seems that while UK PSBs will be able to raise extra money from new retransmission fees to invest in new content, the repeal will not have much impact on the price charged to the viewer. The removal of Clause 29(3) and the rapid introduction of the repeal of Section 73 will benefit both the PSB content providers and the creative industries across this country.

[Lord Black of Brentwood (Con)]

My Lords, I should like to say a few words in support of Amendments 73 and 235, to which I have added my name, and in doing so draw attention to my media interests as listed in the register. Like the noble Lord, Lord Clement-Jones, whose summary of the issues was excellent and which I wholeheartedly endorse, I warmly welcome Clause 29 and the Government’s decision to scrap Section 73, but I urge them to get on with it straightaway rather than having any form of transitional period, as time really is of the essence.

There is a good reason for that. No one can be in any doubt about the speed of change right across the media. A technological tsunami is overwhelming all those involved in content production, while the pace of development in the sector is relentless and punishing. It is the clear responsibility of any Government who believe in the creative economy—and this Government certainly do—to do all they can to support them through it, in this case by allowing the commercial television sector to invest more in world-class content. The question of retransmission fees is one where the Government can be a real help or, indeed, a real hindrance.

The legislation that is being repealed is nearly 30 years old. When it was put on the statute book, the fax machine was a technological novelty and there is simply no rationale for it continuing a day longer than it has to. Like the noble Lord, Lord Clement-Jones, I cannot see any reason for there to be a transitional regime, especially as all those involved have had fair warning of something which, as he said, we have been discussing since 2008. A further delay of up to two years is a lifetime in the creative industries and Section 73 is doing real harm now. If we are committed to a successful commercial public sector broadcasting industry and want to see investment in brilliant content, we should make sure that Section 73 goes as soon as the ink is dry on this legislation. Any law that is out of date and doing positive harm should go straightaway and not linger. It would be a real boost right across the whole of the UK’s creative economy and ensure that it gets an immediate benefit from this very important Bill.