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BBC strikes best deals for talent on TV: O&O report

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MUMBAI: The BBC is making the best deals for acquiring talent on television, an independent review report said.

The BBC Trust has published its conclusions and recommendations based on the findings of a report by Oliver and Ohlbaum Associates Ltd (O&O) on BBC's role in the UK market for on-air and on-screen talent.

The report says there is no evidence that the BBC is paying more than the "market price" for leading TV talent when it finds itself competing with rivals to secure their services. In some cases, it may well be paying less than the market price for that talent. 

The BBC has also not systematically pushed up prices in the talent market. Where high rates of inflation do currently seem to exist in the BBC this is largely due to market forces at work in the rapidly changing UK TV and radio markets, the report says. 

The BBC has a number of systems in place to ensure that it achieves value for money in its negotiation of talent fees, and has strengthened these processes in recent years. 

However, O&O's findings also suggest there is room for improvement in the BBC's practices which when implemented could achieve better value for licence fee payers in some of its deals with talent.

BBC Trust chairman Sir Michael Lyons said, "The report shows the BBC is not negatively distorting the UK's market for talent on television and that overall it is achieving deals which represent value for money. We will keep the pressure up to ensure the best deals are reached for licence fee payers and will review progress in 12 months' time."

In 2006/7, the BBC made an investment of around £242m in on-screen and on-air talent (including independent commissioning in TV and Radio) which represented around 5.6 per cent of its total licence fee expenditure. The vast majority of its 200,000 talent contract payments were for less than £1000.

Following the implementation of new controls by the BBC, the inflation rate in talent fees per hour for top TV talent has almost halved from levels during the period 2000/01 to 2003/04. All BBC talent spend on television and radio programmes – including those from independent producers – is estimated to have grown by approximately 6 per cent each year over the last three years.

Judgements are more complex in some areas where there are fewer direct comparisons, for example in some parts of network radio. To help reach a clearer outcome, BBC management are already drawing on O&O's findings and recommendations as part of their strategic talent review and the Trust will report progress report in 2009.

On the value of talent to audiences, Sir Michael said, "Our conclusions reflect the importance of talent to audiences and the contribution they make to the distinctiveness of programmes: they are often what make audiences tune in and turn on. Indeed, the value of great entertainers, comedians, actors, presenters, journalists and interviewers is rightly very high and the BBC has a special responsibility because of its unique funding to help develop the UK's talent base for the benefit of the industry as a whole."

The increasing competition for talent in recent years amongst commercial television broadcasters is acknowledged in the findings as the main factor in increasing talent costs. However, although the BBC must not put at risk its ability to attract the best talent to be enjoyed and valued by licence fee payers, the BBC does not face the same commercial pressures as its competitors. Its secure funding brings with it a duty to take creative risks and develop new talent and programme formats so it is not overly reliant on the established names that others rightly compete for.

Sir Michael added, "The BBC has to be prepared to walk away from deals that do not offer good value to the audience and to equip itself to do this by continually bringing on new talent and through good succession planning."

The Trust is clear that the BBC can do more to achieve value for money by improving some of its processes, and in particular by a more consistent and systematic approach to gathering independent data and subjecting deals to more rigorous challenge. Likewise, a more systematic approach could be applied to using the BBC's bargaining power in respect of levels of exposure that can be offered to talent by the BBC.

In conclusion, Sir Michael says, "I do understand that many people will continue to question the salaries paid to some BBC performers. These high payments can be particularly difficult to accept when wages elsewhere (including in other parts of the BBC) are under pressure. I hope that, because the Trust has had a good look at this I can at least give licence fee payers some assurance that the BBC is working hard to meet its obligations both to deliver quality and to keep the cost of its talent under control."

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