The document summarizes a report on public service broadcasting funding models and performance internationally. It finds that the UK has one of the highest levels of public funding per capita for public broadcasters. UK public broadcasters also perform well in terms of audience share relative to funding. While broadcasters with multi-year funding agreements tend to receive more public money, this does not necessarily lead to better audience outcomes. The document benchmarks UK public broadcasters' investments in online and multi-platform services.

1. Public service broadcas/ng:
An interna/onal comparison of
funding models and performance
22 June 2011
Prepared for
Westminster Media Forum
Prepared by
Nordicity

2. Table of contents
1. Overview
2. Public funding and value for money
3. PSB funding models and audience performance
4. Government‐contract tenures
5. Summary
6. Notes on data
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3. Overview
 Public service broadcasters (PSBs) in many Western countries have come
under increasing financial pressures in recent years.
 Fiscal retrenchment
 Pressures to invest in new plaPorm content and distribu/on
 Abrupt and severe ad recession
 Migra/on of audiences and ad spending to Internet and mobile plaPorms
 Examine the interna/onal posi/on of UK PSBs in terms of public‐funding
levels and value for money in terms of audience performance.
 Review PSB funding models in Western countries and their impact on
audience performance.
 Consider the effect that the tenure of government‐funding contracts has
on overall public funding levels and value‐for‐money outcomes.
 Benchmark UK PSBs’ level of investment in online and mul/‐plaPorm
services.
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4. Public funding per capita
Amongst Western countries, the UK displays one of the
highest rates of public investment in public broadcas;ng
Public funding per capita, 2009 (£)
 In 2009, licence fees and
other government
funding of public
broadcas/ng in the UK
was equal to
£57 per capita.
 Public funding for UK
PSBs was 40% higher than
the 18‐country average of
£41 per capita. Source: Nordicity compila/on based on public reports
* Includes es/mates for autonomous region broadcasters
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5. Trends in public funding per capita
Most PSBs have experienced real decreases in their public
funding since 2004
Real change in public funding per capita, 2004‐2009
 UK PSBs were amongst a
minority of PSBs that
experienced a real‐
currency increase in per‐
capita public funding
between 2004 and 2009.
 The real‐funding increase
for UK PSBs was only
1.7%, however.
Source: Nordicity compila/on based on public reports
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6. Value for money: audience performance
UK PSBs are near the top of the table in terms of
delivering audiences in rela;on to public funding
Audience share points per £ of Number of naHonal viewers per
per‐capita public funding, 2009 £m of public funding, 2009
Source: Nordicity compila/on based on public reports and audience data from
EurodataTV Worldwide
* Includes es/mates for autonomous region broadcasters
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7. Value for money: overall audience producHvity
UK PSBs also display above‐average value for money in
terms of overall audience produc;vity
Number of naHonal viewers per £m of total
turnover (public funding + commercial revenues**), 2009
 In 2009, UK PSBs (BBC +
C4 + S4C) generated
6,642 viewers per million
pounds of total turnover
– including public and
commercial revenues.
Source: Nordicity compila/on based on public reports and audience data from
EurodataTV Worldwide
* Includes es/mates for autonomous region broadcasters
** Excludes BBC’s revenues outside of UK public services expenditures 7

8. PSB funding models
PSBs’ reliance on commercial revenue sources ranges from
nil to as much as two‐thirds of total turnover
Commercial revenues as a share AdverHsing revenues as a share
of total broadcasHng turnover, 2009 of total broadcasHng turnover, 2009
Source: Nordicity compila/on based on public reports
* Includes es/mates for autonomous region broadcasters
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9. PSB funding models
Countries with higher levels of per‐capita public funding
tend to rely less on ad revenue
Share of total turnover from adverHsing
revenues vs. public funding per capita, 2009
 UK PSBs’ level of
public funding is
commensurate
with the share of
total turnover they
derive from ad
revenue.
Source: Nordicity compila/on based on public reports
* Includes es/mates for autonomous region broadcasters
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10. PSB funding models and audience performance
No evidence that countries with commercially oriented
PSBs have beIer audience performance
Audience share vs. ad‐revenue intensity, 2009
 There is no
correla/on between a
PSB’s reliance on ad
revenues (ad‐revenue
intensity) and its
audience share.
Source: Nordicity compila/on based on public reports and audience data from EurodataTV
Worldwide
* Includes es/mates for autonomous region broadcasters
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11. Government contracts and public funding
PSBs with mul;‐year funding seIlements are more likely to
receive more public funding on a per‐capita basis
Public funding per capita and tenure of funding seRlement
 Two‐thirds of PSBs in the
top half of the funding
table are on mul/‐year
seglements.
 PSBs with mul/‐year
funding seglements
obtained 17% more public
funding per capita (£45 vs.
£38) than PSBs on annual
funding seglements.
Source: Nordicity compila/on based on public reports
* Includes es/mates for autonomous region broadcasters
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12. Government contracts and value for money
However, mul;‐year funding does not appear to lead to
beIer rates of audience produc;vity
Number of naHonal viewers
per £m of total turnover, 2009
 PSBs with mul/‐year
funding seglements are no
more likely to be in the top
half of the value‐for‐
money table in terms of
overall audience
produc/vity.
Source: Nordicity compila/on based on public reports and audience data from
EurodataTV Worldwide
* Includes es/mates for autonomous region broadcasters
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13. Online and mulH‐plaSorm services
UK PSBs display one of the highest rates of investment in
online and mul;‐plaLorm services
Online and mulH‐plaSorm expenditures per viewer, 2009 (£)
 UK PSBs invested a total
of £226m in opera/ng
expenditures in online
and mul/‐plaPorm
services in 2009 – the
equivalent of £7.71 per
viewer.
Source: Nordicity compila/on based on public reports and audience data from
EurodataTV Worldwide
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14. Summary
 The UK has one of the highest rates of PSB funding per capita; and
has, up un/l recently, maintained the real value of this funding.
 UK PSBs display strong value‐for‐money, in terms of audience
performance in rela/on to public funding, and overall audience
produc,vity.
 The public funding of UK PSBs is consistent with their capacity for
accessing ad revenues.
 PSBs with access to ad revenues do not realise higher audience
performance.
 PSBs with mul/‐year funding are able to secure more funding per
capita, but do not necessarily deliver beger audience produc/vity.
 UK PSBs are amongst the largest investors in online and mul/‐
plaPorm services.
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15. Notes on data
 PSBs are defined as broadcasters owned by a na/onal or regional
government or elected assembly, regardless of revenue sources.
 All financial and opera/ng data sourced from public financial reports
published by public broadcasters on their websites. Audience data
sourced from EurodataTV Worldwide, One Television Year in the World
2010.
 All financial data converted to Pounds Sterling based on purchasing
power parity (PPP) exchange rates.
 Sta/s/cs for UK include BBC (domes/c opera/ons), Channel 4 and S4C.
BBC World Service and the interna/onal services in other countries (e.g.,
Radio‐France Interna/onale and Deutsche Welle) are excluded.
 Public funding includes TV/radio licence fees and other government
funding.
 UK sta/s/cs for 2009 correspond to 2009‐10 fiscal year (ending April
2010).
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16. About Nordicity
Nordicity is a bou/que consul/ng firm providing private and public
sector clients with solu/ons for Strategy and Business, Economic
Analysis, Policy and RegulaHon across four priority sectors:
 Arts, Culture and Heritage
 Digital and Crea/ve Media Nor∙dic∙i∙ty
The degree of northernism.
 ICT and Innova/on Symbolises the common
 Telecommunica/ons and Spectrum values and culture shared by
people residing in the
northern la/tudes.
Nordicity serves clients across the world from our four offices in
London, Toronto, ORawa and Vancouver.
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+44 (0) 751 197 9022 +1 613.234.0120
Toronto Vancouver
+1 416.657.2521 +1 604.340.7997
nordicity.com
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