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Unit 8 Understanding TV &

UN IT 8/ TASK 01 Owners & Controllers
a) Discuss (in any format) how the BBC (public service,
global) and ITV (commercial and private) are fi nanced
& structured. Engage in personal commentary on the
diff erent values associated with each business model.

BBC Finance & Funding

The BBC is the worlds leading public service broadcaster. Its
mission is to enrich peoples lives with programmes that inform,
educate and entertain. The BBC is a public service broadcaster
funded by the licence fee paid by UK households. Everyone in the
UK who watches or records TV programmes at the same as they are
shown on TV needs to be covered by a TV licence. This includes TVs,
computers, mobile phones, games consoles, digital boxes and
DVD/VHS recorders. The Government sets the level of the licence
fee. In January 2007 the licence fee was agreed for a six-year period
with the amount being approved each year by Parliament. More
recently the Government decided to freeze the licence fee at its
2010 level of 145.50 (the equivalent of 12.13 per month or just
under 40p per day) until 31st March 2017. The BBC used its income
from the licence fee to pay for its TV, radio and online services, plus
other costs, as shown below.
8.00 per month per household.
Total spend 2,276m (66%)
2.30 per month per household.
Total spend 650m (19%)
0.61 per month per household.

Total spend 174m (5%)

Other costs
1.82 per month per household.
Total spend 357m (10%)

BBC Media Action uses the power of media and communication to

help reduce poverty, improve health and support people to
understand their rights. BBC Media Action received 40 million in
the year 31 March 2013. The primary source of funding was grants
receivable from international donors. During 2012/13 the largest
donor was the British Governments Department for International
Development (DFID). Further governmental funders that also
support the organisation are the British Governments Foreign and
Commonwealth office, European Union and the US Government (via
the US State Department and USAID). Project specific funding is
also received from a number of charitable foundations, most
significantly the Bill and Melinda Gates Foundation.

ITV Finance

ITV gets its income through sponsorship and advertising. It sells

time on that channel to help companies sell their product and/or
brand. ITV Sponsorship offers varied and vibrant content and gives
the brand the opportunity to become affiliated with a programme,
bringing it closer to the heart of the particular shows fans.
Sponsoring a show allows the company/brand to place a series of
short credit sequences around a programme, which could feature
their logo and message.
ITV broadcasts a wide variety of content on its family of free to air
and pay channels, consisting of ITV, the largest commercial
television channel in the UK, and the digital channels including ITV2,
ITV3, ITV4, ITV Encore and CITV. ITV has the largest share of the UK
television advertising market at 45.4% in 2013.

Management & Structure

The Executive Board is responsible for the operational management
of the BBC.
Directors from across the BBC contribute to the leadership of the
organization as part of the Executive Team. Further information
about the structure of the Executive can be found below.
Executive Board
The Executive Board runs the BBC. It is responsible for delivering the
BBCs services in accordance with the strategy agreed with the BBC
Trust, and for all aspects of operational management.
The Director-General is chairman of the Executive Board, as well as
chief executive and editor-in-chief of the BBC; the BBC Trust
appoints him. The Board is made up of executive directors from
within the BBC and a number of non-executive directors, who bring
external expertise and insight to the operation of the Board.

The basic structure has the chairman (Archie Norman) at the top,
with the board of directors (Mike Clasper CBE, John Cresswell, Ian
Griffifths, Andy Haste, Rupert Howell, John Ormerod and Baroness
Usha Prashar CBE).
The day to day running of the company is handled by the
Management Team (John Cresswell, Ian Griffifths, Rupert Howell, Lee

Bartlett, Carolyn Fairbairn and Peter Fincham).

The company is split into three areas: Broadcasting, Online (both
run by Peter Fincham) and Global Content (run by Lee Bartlett).

b) Select at least two independent companies (from

fi lm, online or TV platforms) and discuss their
structure and funding sources (e.g. subscription, licence
fee, pay per view, advertising, product placement, private
capital, development funds, lottery aid etc.) and
associated cultural/ societal issues such as:
The digital divide (are the elderly marginalised from online
communication?) fi nancial collapse (people cant pay the
licence fee anymore or others accrue debt to stay
Creative monopolies (All 3 Media, ITV, C5, C4 etc.).
Consumer culture (personalised consumption of media as
part of everyday life, identity and communication activities
e.g. blogs, Facebook, gaming, fanzine websites, You Tube consumers as producers etc.).

Channel 4

The channel was launched on the 2nd November 1982 with a unique
business model; its primary purpose is to fulfill their obligation to be
innovative, distinctive and experimental. Through its film arm Film4
Channel 4 is also a key supporter of British film making talent. As a
publisher-broadcaster, Channel 4 is required to introduce UK content
from the independent production sector. Source:
Channel 4 actively participates in debates about government policy
and regulation in the communications sector. Source:
This shows Channel 4s official remit:

Channel 4 is a commercially- funded public service broadcaster that
is publicly- owned. They do not receive any public funding. The
channel is predominantly funded by advertising and sponsorship;
however unlike other broadcasters such as ITV, shareholders do not
own Channel 4.
Non- executive directors are appointed by OFCOM
( an independent regulator and
competition authority for the UK communications industry, in
agreement with the Secretary of State for Culture, Media and Sport.
The system ensures their not-for-profit status; that they are held
accountable and that all of the profit that is made by their
commercial activity is directly invested back into the delivery of
their public service remit. Source:

The channel works across television, film and digital media to
deliver a public service remit, which is outlined in the 2003
Communications Act and most recently the 2010 Digital Economy
Act. Channel 4 is a statutory corporation. This means that they are
independent of the Government, and governed by a unitary board
made up of executive and non-executive directors who are
responsible for ensuring that Channel 4 achieves its responsibility
and provides its financial responsibilities.
Additionally Channel 4s portfolio includes; E4, More4, Film4 and
4Music, as well as an expanding range of online actions that include, Channel 4s signified video-on-demand service 4oD
and standalone digital projects. The Channel is a main investor
within the UKs creative economy, working with approximately 300
creative companies across the UK annually and significantly
investing in training and talent development throughout the
industry. Source: