The BBC has published a detailed response to suggestions that it should put its online platform BBC iPlayer behind a paywall.
In a blog post the BBC’s director of policy, James Heath, says it is a “big if’ as to whether a subscription model in whole or part would even be able to compensate for the loss in licence fee revenue.
Heath says that making the iPlayer subscription-based through a pay-TV provider would restrict the service to the half of the population that has pay-TV. This would rule out both Freeview and Freesat which, he says, are generally used by the less well off and the excluded.
He also questioned the potential of online distribution, arguing that the fees would be unlikely to cover the cost of BBC Four.
“The headline conclusion is that the services would be very unlikely to generate sufficient revenues to cover their service costs. And the challenge is all the greater because moving to subscription would introduce new costs as outlined above, including customer acquisition and retention, platform charges for carriage, and transition costs,” said Heath.
To generate the same amount of income, those subscribers would have to pay proportionately more to cover the shortfall.
Last week Channel 4 chairman Lord Burns suggested that placing the iPlayer behind a paywall could be the first step towards a subscription model.
An anomaly in current legislation means that it is not necessary to pay the licence fee if you are only watching on demand, as opposed to linear, television.
