Ed Vaizey calls for cuts in PSB satellite fees

Communications minister Ed Vaizey has called for an end to retransmission fees charged by UK satellite platform operators for carriage of BBC and other Public Service Broadcaster’s channels on their platforms. A cut in fees could reverse proposed BBC cutbacks and put extra money into ITV’s coffers.
Speaking at the Oxford Media Convention, he said “We also want to see a solution to the current situation on so-called retransmission fees where Public Service Broadcasters (PSBs) and Licence Fee payers have paid large amounts to satellite providers for the content to be carried. We’ve looked very carefully at arguments on both sides and recognise that this situation has evolved over time perhaps in a way we didn’t intend.
“I welcome the steps Sky have taken so far to reduce retransmission fees to a much lower level. But we want them to go further, taking into account the undoubted value that PSB’s offer to satellite platforms and their viewers, so that there’s a level playing field – zero fees either way.
“This would mirror the arrangement that is currently the case for PSBs and cable platforms, where no charges are made – an arrangement that we want to see this preserved. We’re looking closely at how we can help achieve this without allowing other kinds of services – which offer no support to PSBs and therefore ultimately no advantage to consumers – to benefit.”
However, Mr Vaizey stopped short of introducing new laws to prohibit carriage fees, stating: “We’re not going to rush into a regulatory solution because we think there’s no reason the market shouldn’t be able to work out a fair equitable solution as things stand, but if the industry can’t find a way to stop imposing this cost on Licence Fee payers and PSBs, we will look at our options for intervention.

Re-transmission fees have been raised as part of the Communications Review process. It has been argued that PSBs are at a disadvantage when negotiating fees, as they are obliged to try to ensure they are available on all major TV platforms, while satellite platforms have argued they are covering costs incurred carrying PSB channels.”
Mr Vaizey said the industry should be able to reach a fair and equitable solution but if that was not possible the Government would look at intervening.
A reduction or abolition in carriage fees for BBC services on satellite would enable the Corporation to cancel some of its cutbacks in local radio. It could pave the way for the BBC to add all national BBC One HD variants to the Sky EPG without incurring additional costs.

Similarly, ITV would benefit greatly due to the number of regional variations it carries.Critics of retransmission or carriage fees for public service broadcasters on satellite note that beyond the already existing postcode database which allocates the correct regional service to viewers, there is little additional cost incurred, as the BBC, ITV, Channel 4 and 5 services (with the exception of some HD channels) are sent to satellite by the respective broadcasters and their agents – satellite platforms just need to add channels to the programme guide and provide a channel number, which can be done inexpensively. The cost of renting satellite capacity for these services is met by the broadcasters, not the satellite platform operators. Critics further note that there is no such charge on cable services and that in other countries it would be the satellite platform operator paying the broadcasters for carriage.