Why does the BBC spend more on its web sites than all of our national newspapers put together?
Posted by
Peter Kirwan
on 20 May 2009 at 13:22
Tags: BBC, Media
To be honest, I’m not a great fan of the Economist. Using all of that superb brainpower to promote a predictable species of conventional wisdom has always seemed a bit like driving a Rolls Royce to your local Tesco.
There’s nothing terribly wrong with doing this. But it does make you look a bit arrogant. Occasionally, too, it can make you look like a bit of a twat.
So we come to this week’s edition of The Economist, which offers up 3,800 words on the future of the news business.
For anyone who has lived on Mars for the past three years, I guess this kind of thing is useful.
But for the rest of us, the revelation that Mail Online has “built a reputation for celebrity news” hardly qualifies as staggering. The suggestion that local news outlets are “ailing” as cars dealers “trim their advertising” can’t be described as revelatory.
Racing towards the end of the 3,800 words, I was feeling the familiar lack of excitement that often results from reading the Economist.
And then I ran across this reference to the UK’s media market:
The annual budget for the websites of the (state-owned) BBC was recently raised to £145m ($220m). According to Mr [Paul] Zwillenberg [of media consultancy OC&C], the total online spending of the country’s national newspapers is only £100m.
My first thought? Even if the Economist does deploy this information in throwaway fashion in third-last par of a 36-page story, I’ve got to admit that Rolls-Royces have their uses. Occasionally.
On this basis, I’ll tell the Economist what I would find useful. Instead of a recitation of various well-known facts about Big Media, a worthy subject for in-depth coverage would be that disparity between the BBC’s £145m and the £100m invested by everyone else.
Is this disparity a symptom of market failure? Or its cause? Or both? Should the situation be changed? If so, why? And how?
I’m genuinely unsure about all of these questions. What I do know is that the disparity is going to become increasingly harder to justify as the downturn continues.
UPDATE: 20/05/2009 — Some good points in the comments, one of which links to Paid Content’s breakdown of that £145m: “No it doesn’t include iPlayer and other long term projects. But it does include all editorial based around bbc.co.uk — not just news.” (Thanks for that, Matt.)
Few would disagree with Alastair’s suggestion that bbc.co.uk has “raised the bar in terms of user experience and engagement” over the past three years. Given the costs involved, you’d expect that: bbc.co.uk is a great site, and so it should be.
Presumably, though, it has sucked traffic away from the nationals’ sites. I guess the real question here is what the market would look like in the absence of bbc.co.uk. If some of that traffic had flowed instead to the nationals’ sites, could they have monetized it? And then re-invested in their own operations?
Perhaps. But the current moaning about unsold inventory (ad space) and rock-bottom CPMs among the nationals suggests that there would have been a limit to monetization.
Perhaps this is what Sir Michael Lyons, chairman of the BBC Trust, was getting at in March when he argued that “any potential adverse market impact of the new investment [an additional £31m for BBC Online over three years] would be justified by the public value created”.
UPDATE: 22/05/2009: Martin Belam: “As an ex-BBC employee, I usually find comparisons between the BBC’s entire web spend and newspaper spend on the web a case of apples = oranges. The entire budget isn’t funding the BBC News website alone, and newspapers don’t have to produce charter-bound educational content.”
