BBC Chair: A TV Licence Subscription Would Cost £400/Year

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Would you pay £400 per year for a BBC subscription that includes TV, radio and news? This provocative notion was at the heart of Dame Elan Closs Stephens’ speech at the Voice of the Listener & Viewer Autumn Conference today.

As the Acting Chair of the BBC, Stephens stirred the ongoing debate over the TV Licence fee, suggesting a future where the traditional model might be replaced by a subscription akin to those of Netflix or Amazon’s Prime Video.

At a time when the concept of a compulsory TV Licence fee is increasingly under scrutiny, Stephens’ words resonate with a public divided over the value of the BBC’s services versus the cost they bear.

Her speech, though rooted in optimism, broached the contentious topic of the BBC’s funding mechanism, particularly the TV Licence fee, and hinted at a possible shift towards a subscription model – and the aspects that must be guarded, if the BBC is to continue delivering on its mission.

The BBC’s Financial Challenges

The financial future of the BBC, deeply tied to the income from the TV Licence fee, was a key focus of Dame Stephens’ address.

Dame Elan Closs Stephens BBC Acting Chair
Dame Elan Closs Stephens (Photo: BBC)

For now, the licence fee is guaranteed as a mechanism until at least the end of the current Charter in 2027 – so discussions relate to what happens after that date.

However, Dame Stephens underscored a growing public concern over the licence fee, encapsulated in the question: “Why should I pay for what I don’t use?”.

This sentiment reflects a significant shift in how people view the TV Licence fee.

Traditionally, the fee was seen as a collective contribution for a shared public good, providing a range of broadcasting services for everyone, regardless of individual usage.

TV licence documents

However, Stephens’ speech pointed out that more and more people are questioning this approach.

They are moving towards a mindset where they expect to pay only for the media they personally consume, similar to how one chooses and pays for individual streaming services.

This change in attitude is leading to a broader conversation about whether the current model of funding the BBC is still appropriate or if it should be reformed to fit this new individualistic approach.

TV Licence Fee VS A BBC Subscription

Currently, the TV Licence fee, a mandatory annual charge for all UK households, businesses, and organisations, is the primary source of funding for the BBC.

Standing at £159/year (having been frozen for two years, therefore it will be going up to £169.50 next April), the fee is required by anyone watching or recording live TV broadcasts, any BBC content, or BBC iPlayer, regardless of the device or method used.

This includes watching any live TV from any broadcaster, even international ones. If you only watch on-demand content such as Netflix, Disney+ or ITVX (except for iPlayer) – you don’t need a TV Licence (see our full guide on who needs to pay the TV Licence fee).

TV Licence infographic 2020

Evading the TV Licence fee is a criminal offence – and those who don’t pay can end up in court, and – in rare cases, end up in jail.

But with the world moving to standalone streaming subscription services, a notable aspect of Stephens’ speech today was the comparison between the licence fee and a subscription model for the BBC.

She stated, “When the cost of the licence fee is compared with the monthly cost of a subscription streaming service, it would probably be around £400 a year, and that’s a pretty accurate comparison.”

This figure is derived from the comprehensive nature of BBC services – encompassing eight national TV channels, ten UK radio stations, digital apps like BBC News, Sport, and Weather, BBC iPlayer, Sounds, and Bitesize, as well as the orchestras, the Proms, and the World Service.

BBC News on laptop
(Photo: Deposit Photos – Alla Serebrina)

In comparison, subscription services like Netflix or Amazon’s Prime Video offer a narrower range of content, often focusing on entertainment without the broad educational and informational scope of the BBC.

This comparison also reflects the value proposition of the BBC, offering a wide array of services for a price that is competitive with commercial streaming services.

In 2021, the BBC mentioned a similar estimate for a potential subscription model, placing it at around £453 annually, which further aligns with Stephens’ current assessment.

The UK government has mentioned, more than once, the possibility of replacing the TV Licence fee with other funding models – including the subscription model. 

But in her speech, Dame Stephens emphasized that the relationship between the public and the BBC isn’t just about paying for a service. It’s more about what role the BBC plays in our society and how it contributes to the broader public good.

BBC News on TV screen 1200

Stephens highlighted five key principles that should guide any discussion on alternative funding models for the BBC.

These principles are crucial in ensuring that the BBC continues to fulfil its role effectively, regardless of how it is funded:

Delivering the Mission: Any new funding model must support the BBC’s mission of providing universal public service.

This means the BBC should continue to offer a wide range of programming that caters to all segments of the UK population, including news, education, and entertainment.

Doctor Who classic collection
Doctor Who (Photo: The BBC)

Safeguarding Impartiality and Independence: The BBC is known for its impartial and independent reporting.

The new funding model must protect these values, ensuring the BBC can continue to deliver unbiased news and content without external influences.

Sustainable Financial Model: The new funding approach should be financially sustainable.

Supporting the Creative Economy: The funding model should enable the BBC to continue investing in the UK’s creative industries.

This involves developing British talent, producing original UK content, and exporting this content to a global audience.

Fair Value for Audiences: Lastly, the model must provide fair value to the audiences. 

These principles are essential in shaping any future funding model for the BBC. They ensure that the BBC not only remains financially viable but also continues to play a pivotal role in British society and culture.

Stephens’ speech culminated in a reflection on the BBC’s heritage and its vital role in national and global media.

The challenge ahead is balancing the BBC’s traditional public service mission with the demands of a digital, subscription-driven age.

The decisions made in the coming years will be crucial in determining the future of the BBC, shaping its ability to adapt while preserving its core values and societal role.

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