European rules for PSBs

By Robert Briel

European countries have to look closer at the effects on the market caused by the activities of public service broadcasters (PSBs), according to the revision of the 2001 Broadcasting Communication issued by the European Competition Commissioner Neelie Kroes.

When public broadcasters launch ’significant new services,’ a public consultation among consumers and market parties is required. Should the market distortion be greater than the benefit of the public task, they should give up such a new venture.

The Commissioner questions the use of premium phone lines by PSBs, agreements concerning merchandising and sponsoring, as well as teleshopping. PSBs should introduce separate bookkeeping of their public and commercial activities.

Control of PSBs should be the task of the individual governments, and each country will have to set up an independent body to control them.

This body should also conduct pre-ante market consultations. As yet, such market tests do not exist, and only in the UK does the BBC have to submit new ventures to the BBC Trust for a public service evaluation.

During the past few years, private media companies have complained about the aggressive launch of new services by PSBs. These include elaborate news sites on the web, on-demand and catch-up TV, pay-TV ventures and the general ‘commercialisation’ of public channels.

A number of publishers and commercial broadcasters associations’ have already welcomed the new ruling in a joint statement: “In the current economic environment, it is of ever greater importance that the European Union rules on state aid are rigorously applied so as to ensure that those private sector companies who do not seek public support are not unfairly disadvantaged.”

However, the EBU is less enthusiastic about the revision of the Broadcast Communication. Mr Jean-Paul Philippot, its president, said in a statement: “We have stressed throughout the consultations that the regulation of public service media is predominantly a national matter, to reflect the diverse social, cultural and democratic features of the various Member States. It would have been preferable to leave the choice of the mechanism to Member States. In this respect the EBU regrets the introduction of a single mechanism for the assessment of new services.”

He concluded that: “We hope that the Commission will leave Member States enough flexibility when they introduce ex ante mechanisms in their country. The EBU also calls on Member States to adapt such a mechanism to their national specificities.”

The Broadcast Communication sets out the principles to be followed by the Commission in the application of Articles 87 and 86(2) of the EC Treaty to State funding of public sector broadcasting. In the EU 27, state aid to broadcasting is estimated as being worth at least €22 billion per year.

Ross Biggam, DG ACT (Association of Commercial Television in Europe), commented: “After strong resistance against the text in particular from national cultural ministries, we congratulate the Commission for having come up with a balanced and workable text. It would have been helpful if further details had been maintained, but we understand that in line with the Brussels policy-making process a compromise had to be found. However, the real work will now begin with the implementation of the new obligations contained in this text by the Member States”.