The UK government has signalled its intention to launch a formal review into the funding of the BBC.
Ministers believe that the current model is “unsustainable” and are expected to put forward alternatives that include subscription, a broadband levy, increased commercial activity and advertising.
It follows figures in the BBC’s latest Annual Report, published last week, which showed the number of households opting to buy a licence fee had fallen by 500,000 to 24.3 million.
One option said to be favoured by ministers is a partial subscription option where elements of the BBC’s output would go behind a paywall, while the majority of its content would remain free-to-air.
Advertising will also be considered, but seems likely to be discounted, given the negative impact it would be likely to have on the exisiting commercial television sector including ITV, Channel 4 and Channel 5, which all have public service obligations. The BBC’s commercial activities within BBC Studios will also be explored.
The BBC itself has previously put forward the idea of a broadband levy that would effectively see the Licence Fee bundled in with other household bills.
Next April the current £159 Licence Fee is due for an inflation linked increase of 8.2% – the highest in 20 years – ministers are exploring how this could be linked to a monthly rather than annual inflation rate that would put more pressure on the BBC finances.
The BBC’s latest round of cuts has seen its international and domestic news channels move into a single service, while BBC Local Radio will be sharing more programmes with neighbouring stations.
