Can BBC Survive The Streaming Era? Decoding Ofcom Data

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As the streaming revolution continues to transform the way we consume TV, the BBC finds itself at a crossroads. Today’s release of the Media Nations UK report by Ofcom paints a stark picture of the challenges faced by traditional broadcasters in the age of Netflix and Disney+.

The rise of on-demand streaming services has not only shifted viewing habits but also ignited a contentious debate about the BBC’s primary funding mechanism – the TV Licence fee.

Ofcom’s report reveals a startling shift in viewing habits, with the shift towards on-demand content reshaping the television industry and putting the BBC’s funding model under the microscope.

Despite the BBC’s proactive efforts to adapt to this new landscape, the growth of its on-demand service, BBC iPlayer, has not been enough to counterbalance the decline in linear TV viewing, particularly among younger audiences.

Streaming services on phone prime netflix disney 1200
(Photo: Deposit Photos / Miglagoa)

As we delve deeper into Ofcom’s report and its implications, the debate around the TV Licence fee is set to intensify.

The Changing Landscape Of TV Consumption

According to the latest Media Nations UK report published by Ofcom today, the average amount of time individuals (aged 4+) spent watching any video content across all devices in 2022 was 4 hours 28 minutes per person per day.

The TV set remains the most-used device for watching video content, accounting for 82% of total video viewing, with live broadcast TV making up the largest proportion of this time.

Across all devices, live TV accounted for 44% of total video viewing in 2022, and, together with recorded playback and broadcaster video-on-demand (BVoD), all content from broadcasters accounted for 60% of total video viewing.

man watchin streaming tv on tablet

However, the report also reveals a significant shift in viewing habits.

Netflix is now the third most popular first destination among all individuals aged 4+, trailing behind only BBC One and ITV1.

This shift in viewing habits is significant, as it indicates a growing preference for on-demand content over traditional linear TV.

Despite the BBC’s efforts to adapt to this changing landscape, the growth of its on-demand service, BBC iPlayer, has not been enough to offset the decline in linear TV viewing.

Fire HD 8 BBC iPlayer
BBC iPlayer

Ofcom’s report reveals that while viewing to public broadcaster streaming services like BBC iPlayer has grown from 4% of total broadcaster viewing in 2017 to 10% in 2022, this growth has not compensated for the larger decline in viewing to broadcasters’ linear channels.

The BBC’s Actions: A Mixed Bag

In the face of the changing landscape of television consumption, the BBC has been proactive in its efforts to adapt and remain relevant. 

In early July, the BBC published its Annual Report for 2022/23, where it claimed that the current collection method for the TV Licence fee is fair, effective, and good value for money.

The report also highlighted the BBC’s efforts to provide value for money by focusing expenditure on the programmes and services the public most want.

However, a closer look at Ofcom’s data reveals a more complex picture.

Despite an increase in public service content spend by 4% in their centenary year, totalling £3,078 million, the BBC’s net income from licence sales decreased by £59 million (1.6%) from the previous year.

This marked the first decrease in licence fee income since the reduction in 2019-20 due to the COVID-19 pandemic.

Ofcom’s report also highlights that the weekly reach of broadcast TV among all individuals has steadily declined, from 91% in 2017 to 79% in 2022.

The largest declines in weekly reach have been among 16-24-year-olds (from 82% in 2017 to 54% in 2022) and children aged 4-15 (from 87% in 2017 to 60% in 2022).

Conversely, weekly reach among those aged 65+ has remained consistently high; at 96% in 2022, there has been just a one-percentage-point decline over the last five years.

Elderly couple seniors watchingTV

While BBC One continues to have the highest weekly reach of all TV channels (58%), this is 12 percentage points lower than in 2017.

This decline in reach, particularly among younger audiences, is a significant challenge for the BBC and raises questions about the relevance of the TV Licence fee, especially among those who primarily consume content through on-demand streaming services.

The TV Licence Fee: A Growing Resistance

The TV Licence fee, a mandatory payment for all UK households watching or recording live TV broadcasts or using BBC iPlayer, has been a subject of controversy and resistance in recent years (see our full guide on who needs to pay the TV Licence fee).

Ofcom’s report also provides some insights into the public sentiment towards public service broadcasting (PSB) and the changing consumption trends that may be influencing this resistance.

TV licence documents

According to the report, audiences continue to be broadly satisfied with public service broadcasting. About seven in ten (69%) PSB viewers said they were satisfied with them.

In line with this, there has been a slight reduction in those stating they are dissatisfied with PSBs, down from 12% to 10%, driven largely by 16-34-year-olds (11% to 7%).

This demographic is also the one that has seen the largest decline in weekly reach of broadcast TV, from 82% in 2017 to 54% in 2022.

However, the report also reveals that Netflix is now the third most popular first destination among all individuals aged 4+, trailing behind only BBC One and ITV1.

Netflix on TV socks
Photo: Deposit Photos

As we recently reported, TV Licence fee evasion rates have hit their highest point since 1995.

The estimated evasion rate for 2022/23 reached 10.31%, up from 9.38% in the previous year. This is the first time since 1995 that the estimated rate of evasion has exceeded 10%.

This increase represents a significant loss in revenue for the BBC, with the estimated loss amounting to around £430 million.

The rise in the evasion rate is likely due to a combination of factors, with the most significant factor being the change in viewing habits.

With the rise of on-demand streaming services like Netflix, Disney+ and local ones like ITVX, people are watching fewer traditional TV programmes and less live TV.

This shift in behaviour has led to a decrease in the perceived value of a TV licence, prompting some people to evade the fee.

Ofcom’s report also highlights that the weekly reach of broadcast TV among all individuals has steadily declined, from 91% in 2017 to 79% in 2022.

This decline in reach, particularly among younger audiences, is a significant challenge for the BBC, with subscription-based streaming services slowly becoming the norm.

The Future Of The BBC And The TV Licence

The challenges faced by the BBC are significant. The rise of on-demand streaming services, coupled with the growing resistance to the TV Licence fee, poses a significant threat to the BBC’s primary funding mechanism.

Watching BBC News on tv

However, it’s not all doom and gloom. Ofcom’s report also highlights some positive points about the BBC.

For instance, the BBC captures a greater proportion of their audiences on broadcaster’s streaming services (14%) compared to other broadcasters. Plus, the BBC is not just about TV – it also provides news, radio and the BBC website.

The BBC’s future will depend on its ability to adapt to the changing landscape of television consumption, demonstrate the value of the TV Licence, and effectively manage its resources.

As the landscape continues to evolve, the BBC will need to find innovative ways to remain relevant and financially viable.

11 thoughts on “Can BBC Survive The Streaming Era? Decoding Ofcom Data”

  1. The BBC has lost the plot. I never bother to watched scheduled tv and as for BBCiPlayer, I used to watch it for news coverage, but even that seems very poor and has other programming such as HardTalk and Nicky Campbell’s Radio 5 Show (if I want to listen to this, I’ll turn on the radio or listen to it via BBC Sounds) as well as other content, with very little on the news media front. A sign of the times that due to its cuts and staff redundancies that the BBC continues on its path of downward spiral slope.

    Reply
    • Hi Karl my opinion is they should get rid of the big wigs just think how much they would save and maybe they would cut the TV licence fees and maybe more people would pay for it instead of evading it instead

      Reply
  2. I have been an avid consumer of BBC news for many years but I now find myself watching GB news more and more.
    This is because the BBC has become to politically correct I may not agree with some political and racial views but I think everyone should be allowed to express there opinion, so long as they do not promote violence or hatred.
    I am also disappointed by the loss of the news channel in HD as I watch on a 85” TV, on the plus side I am pleased now to have local East Midlands news without having to change to low definition BBC1.

    Reply
  3. BBC licence fee needs to be scrapped altogether.
    The BBC has always said they want to give the public a service,well for years I feel they have not.
    I am 72 years old and the only thing I watch on BBC is Match of the day.
    So I am forced to pay them £159.00 for just that.
    If you read the rules of the TV licence fee is:
    The law that requires a TV Licence for using or installing television receiving equipment to watch or record television programmes as they are being shown on TV, or to download or watch BBC programmes, including catch up TV, on BBC iPlayer applies in the UK (England, Scotland, Wales and Northern Ireland), the Channel Islands and Isle of Man.

    So even if you have a tablet,mobile phone,computer

    You must have a tv licence
    I have always said that the BBC should get their money from advertising.

    Reply
    • But legally you do not have to communicate in anyway to TV licensing/ Capita about who you are and your viewing habits.
      Basically no contact=no contract.
      I have a lot of friends in their seventies and eighties, who are not scared of Capita bullies and do this.

      Reply
    • Hello Colin I’m unfortunately paying my TV licence but i don’t even watch any of the BBC’S channels i watch free TV channels I’m not paying for the license when my old one run’s out end of May next year they have rediculous wage structure for a TV presenter who is on over a Million pounds a year is so pathetic why do these greedy people want that kind of money they should sack them all.

      Reply
  4. I think that the licence fee should be a matter of personal choice as to whether you pay it or not.

    I favour a model of encryption where if you choose to pay the licence, you’re offered a free decoder and smartcard to watch BBC TV services that plugs into your TV in two forms i.e. many modern free to air smarttelevisions with built-in Freeview HD and satellite receivers often have a slot for a conditional access card decoder on the back and where you have one of these sets, you’re offered a BBC conditional access card decoder and smartcard that plugs in, and you ring or text an automated authorisation number where you enter you licence fee number name address etc, which authorises it over the air so you can view, or on those sets that don’t have one, a free decoder box that plugs into your aerial and smartcard and HDMI or AV socket, and following the procedure I mention above, same thing, enter your licence fee number / name address etc to an automated authorisation number to access BBC services.

    If you don’t to pay a licence fee, then you can watch whatever else is available free to air in whatever form you like I.e. satellite and digital terrestrial TV including international broadcasts on European satellites with a suitable satellite dish pointed at Eutelsat intelsat Astra 1 etc, without the mandatory compulsory element forced on every household to have a TV licence.

    On Virgin Media cable TV, BBC services would be bundled on the basic tier subscription package for non premium services.

    This solution is a win win for everyone, and those who want to get BBC on iPlayer, same old thing, you enter your licence fee number name address etc to use it.

    Reply

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