If you thought you could avoid the TV Licence fee by sticking to streaming services like Netflix and Disney+, you might want to think again.
The UK government is reportedly exploring plans that could force streaming-only households to pay the BBC licence fee – marking a dramatic shift in how British TV is funded.
According to a Bloomberg report published this week, extending the licence fee to streaming services is just one of several options being considered as part of a major overhaul of the BBC’s funding model.
The Current TV Licence Landscape
For those who’ve been following our coverage, you’ll know the TV Licence fee (currently set at £169.50 per year and rising to £174.50 in April) has been a hot topic lately.
Just two weeks ago, Culture Secretary Lisa Nandy described the current system as “deeply regressive” and confirmed she’s thinking “quite radically and creatively” about alternatives, with general taxation being ruled out.
At present, you only need a TV Licence if you watch live TV from any broadcaster, any BBC content on iPlayer, or – don’t forget – live content on streaming services.
That last bit has already caught some Netflix subscribers by surprise.
The Netflix Connection
Here’s where things get confusing. While most Netflix viewers assume they’re exempt from the licence fee, that’s not entirely true anymore.
As we revealed last year, Netflix’s growing slate of live events – including the recent Paul vs Tyson boxing match and various live comedy specials – already requires viewers to have a TV Licence, and the same is true for sports on Amazon’s Prime Video, and other live streamed events.
But these new proposals would go much further.
Instead of only applying to live content, the licence fee requirement could extend to all streaming service users – whether you’re binge-watching Bridgerton or catching up on The Bear.
A Menu of TV Licence Options
The most significant proposal being considered would fundamentally change how streaming services operate in the UK.
Under this plan, any household that subscribes to streaming services like Netflix, Disney+ or Prime Video would need to pay the TV Licence fee – even if they never watch BBC content or live TV.
This would be a massive shift from the current system, potentially affecting millions of households who’ve cut traditional TV cords in favour of streaming-only entertainment.
For a family that currently pays for Netflix with adverts (£4.99/month) and Disney+ (£4.99/month), this would mean an additional £174.50 annual charge (£14.5/month) – regardless of their viewing habits or whether they use any BBC services.
But this isn’t the only option on the table. Other alternatives being discussed include:
- Introducing a specific streaming service tax
- Requiring BBC radio listeners to pay a fee
- Allowing the BBC to use advertising
- Implementing income-based tiered pricing for the licence fee
- Creating a Netflix-style subscription model for BBC services
In the past, the BBC has said that an equivalent subscription bundle of the BBC’s ad-free video, audio, and premium news services could theoretically cost consumers more than £580 per year.
This all comes at a critical time for the BBC, which is facing what it describes as a real-term annual reduction in income of 30% – that’s over £1 billion.
With evasion rates hitting 11.30% in 2023/2024 (the highest since 1995), it’s clear something needs to change.
Early Days, But Change Is Coming
While these proposals might sound dramatic, it’s important to note that we’re still in the early stages.
The discussions between Prime Minister Keir Starmer’s office, the Treasury and the Department for Culture, Media and Sport are preliminary, with a government source telling The Telegraph they’re still at the “information-gathering stage.”
Any major changes wouldn’t take effect until after the BBC’s current charter ends on December 31, 2027.
What’s clear is that with streaming services dominating viewing habits and the BBC facing unprecedented financial challenges, the TV Licence as we know it is set for significant changes.
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(apologies this is a long one)
TL/DR: It’s not the right approach but nor is a direct tax or adverts on BBC.
Whilst I am a fan of the BBC and willingly pay the fee, this is absolutely the wrong approach, you should only have to pay the fee for live TV. Yes there is live tv on Prime Video, NowTV, even Netflix has had some occasionally. But let’s not get into that issue!
However, for viewers who genuinely only watch on-demand and do not use any BBC services it’s a bit off to expect them to pay the fee. That said the BBC needs funding so there has to be a right way to do this. Some countries use direct taxation (again not a fan of this idea) to fund their PSBs, or a Broadband Tax.
However, there is a reason BBC shows sell so well on the international market, it is one of the best PSBs out there and as a result means other channels in the UK have to try to match it’s quality if they want eyes on their content. A side effect of it’s content doing so well internationally, it does a great job of promoting “Brand Britain” globally which brings in more money for the economy in terms of tourism but also media production here as opposed to France, Germany, etc. So ditching the BBC altogether harms the quality of output on ITV, Sky, etc. (yes there is research out there on this but this comment is already very long)
I know a lot of folk think advertising is the answer, however the commercially funded channels wrote to the Secretary of State for DCMS last year about advertising on BBC Audio Content:
https://www.campaignlive.co.uk/article/coalition-media-firms-warns-devastating-impact-ads-bbc/1872372 (paywall) but here are a couple of paragraphs which summarises their point:
“A coalition of commercial media and content firms has written to the government warning of “serious consequences” if the BBC introduces advertising around audio content in the UK.”
“The letter, to Lucy Frazer, secretary of state for the Department for Culture, Media and Sport, warns ads on BBC UK podcasts and on-demand audio could lead to ads on other content, which would have a “devastating impact” on the commercial sector.”
“Industry opposition is overwhelming and we urge the government to act quickly and engage with Ofcom which has the power to intervene.”
“Signatories to the letter, which has been coordinated by industry body Radiocentre, include ITV, Sky, Channel 4, Paramount and Channel 5, Global, Reach, The Guardian and News UK.”
This was based on research commercial channels commissioned so obviously they have a vested interest in keeping advertising off the BBC but the risk to commercial broadcasters is clearly there. And, if you’re not a fan of the BBC channels and output but love ITV, C4, C5, Sky etc. it is clear these channels feel that advertising on the BBC could lead to a reduction either in the number of viable commercial channels as well as the breadth and quality of their output, or in the case of Sky the need to significantly increase subscription costs to make up for the loss of advertising revenue due to the BBC, which still has the lions share of viewers potentially hoovering up the bulk the ad spend.
There has to be a way to fund the BBC which allows it to still create amazing (IMHO) content whilst not annoying folks who don’t watch any live TV. I clearly am not clever enough to come up with the right solution in the comments section but there must be a sensible solution. And, the BBC is not alone in this quandary, other countries’ PSBs which still have the same funding model are facing the same challenge.
The BBC aren’t opposed to adverts as they show them all the time on BBC America. Then all the dad’s & other format of their programs they happily sell.in 2022 they sold their stake in Britbox to ITV for £255 million. They advertise their programs on YouTube & yet another government wants to force people to pay a tax for rubbish programming.
If BBC1 was shut down & BBC3 maybe then it would be worth paying for the programming that the other 2 channels put out. When the previous government put prices up they didn’t do a thing they let the ombudsman do it , this lot are cutting their own political throat’s already & its not even been a year. All the bills have gone up especially water & yet they still choosing to bully the most vulnerable. I’m surprised they haven’t said if you have a mobile phone you must pay the licence fee.
This is just a passing phase and will never come to anything in terms of implimenting the licence fee through streaming and besides, Netflix users already pay VAT on this.
With one of the alternatives – The BBC considering advertising. Sadly, that ship has already sailed and no advertiser is going to spend money on advertising if a majority of people are switching off BBC.
The news is nothing short of our government trying to scaremonger its Netflix subscribers and I’m sure if this was the case, Netflix will hit back at the BBC, if there is a trend of its subscribers cancelling their subscriptions.
Its all a load of nonsence with the BBC and our government.
Crazy idea.
It’s simple really- those that use the service should pay, those that don’t shouldn’t.
With the obvious bias of a once appreciated BBC I stopped watching their opionated news and documentaries. Don’t agree it should be funded by taxation or licence fee but wholly by those who want to watch it
Cue all the usual suspects deriding the hapless BBC. If you have ever lived elsewhere (including USA) you would probably know how highly people rate our public broadcasting system and know what excellent value it currently offers. Change is needed but, as someone once sang, you won’t know what you’ve got ‘til they take it away.
Usual suspects for a good reason, if you think so highly of the BBC, then you pay for it, or is it that you want those that don’t watch it to subsidise it for the likes of you, no thanks, that dinosaur is well past its sell by date. If the USA are so in love with it, let the BBC set up shop there
I watch live Euro’s & World Cup.
Can’t abide the soaps as they are so far from the real truth of how normal people react & how we react. I was a 70s kid & the BeeB had so much great programming & always would show brilliant costume drama’s , nature documentaries & even Top of the Pops but that was when it was worth watching & i must also have to mention Saturday nights was always won by the BBC1 . However that was then & now the cost of a licence goes up & the quality comes down , they’ve even resorted to buying programs made by Dave & U & showing them instead of creating new programs . Except from The repair shop the rest is repeats.
I totally agree that I miss a lot of the shows from the 70s and 80s however, I’m not sure I can agree the quality has gone down. I look at old BBC shows on Gold and compared with what’s on one of the BBC networks now and the quality has gone up to my eye. Production values are far higher now and, certainly the acting quality, in the round, is better as they play far more to the subtext than they used to.
As for the programs on the U& network (Dave, Eden, Yesterday etc.), the network is owned by BBC Studios (what used to be BBC Worldwide). So it’s kind of already BBC Content, so it’s logical that once their commercial channels have aired it, it will make its way to the main BBC channels. In addition some Freeview areas on repeater transmitters don’t get all the channels so it gives folks a chance to see those shows if they also are shown on the main BBC channels.
All of that said as TV is a form of art and as art is subjective, what I like will not be the same as someone else’s taste and means it’s no more valid than anyone else’s.
Ah, so the BBC aren’t against running adverts then !!!.
Also colour me educated as I didn’t know that the channels you mentioned were owned by the Beeb, however it makes total sense now so thank you for that nugget.
I suppose had the technology been available back then the production would be higher too.
I do watch a lot of programming on both BBC 2 & 4 as I find it far more entertaining & educational than both eastenders & match of the day which seems to be their 2 main programs bar the news & i regularly watch the headlines before changing. Oh just realised Death in Paradise is a program I now enjoy thanks to U&Alibi.
Yeah, I find I’m more Two and Four now than One, except Strictly, sorry not sorry LOL…
Yeah the BBC has a very large commercial arm: BBC Studios. They own the IP for most of the large entertainment shows, Strictly/Dancing with the Stars, Dr Who, Eastenders, Death in Paradise etc. etc. and sell those shows or the licence broadcasters to make local version of it. As I understand it BBC Studios provide about 40% of the funding for the BBC so our licence fee is topped up by its successful shows.
Let’s not forget it also owns studios up and down the country that other broadcasters use (ITV This Morning is filmed at BBC Studioworks in what used to be TV Centre). So shutting down the BBC would gut the TV industry in the UK and it’s not as simple as allowing adverts BBC channels as that wold gut the ad revenue for the likes of Sky, ITV, C4 etc. again, resulting in a shrinking of the media landscape of the UK.
The BBC licence fee needs to end. It is well past its sell by date in a world where commercial broadcasters and streaming services provide what most people want.
Forcing people who watch other services to pay the BBC for content they don’t want is like asking people who shop at Tesco to pay Sainsbury’s at the same time. It’s just ridiculous and unfair.
Public sector broadcasting needs to be slimmed down to provide content which commercial broadcasters choose not to. A version of PBS in the UK funded through some kind of tax or levy is the way forward.
Have not watched the BBC for years , Their content is of no interest to me
and their money is awarded to a few untalented dorks who got their jobs through in house connections. Their comedy is only funny to those who are taking part and are laughing at us because of their ridiculously high fees that are paid to ‘companies’ to avoid tax.
This scam has got to end. It is pathetic that those on millions of pounds are so desperate to avoid tax .
Isn’t VAT charged on the subscription?
Interestingly it doesn’t mention anything about free streaming services as I doubt they would be exempt. The BBC is just trying to force people who decided to drop linear TV to have to pay some how. Why should they be entitled to money if you choose to pay for a streaming service that doesn’t carry their content? They may as well just include it in people’s council tax at this rate if they want everyone to pay rather than finding new things to add to the TV licence.
The B.B.C. should be funded by general taxation.
But why a general taxation if nobody wants to pay? Not many people want the BBC full stop, partly because of their poor quality programming. The BBC is deluded into thinking that people ARE watching their content and the general public are trying to avoid the licence fee. I mainly use YouTube to catch-up on current events.
NO that another thieving tax from this Marxist government.
I fancy a lot of the streaming services are going to suffer, tax, tax, tax, everywhere you go, so now, even if your are not bothered about the BBC, you will be forced to pay for it, how enterprising.
That’s exactly the danger with Miss Nandy, finding another way to make us pay, so that if you don’t want to watch it, you still pay, music to the BBC ears.
It’s the general public who will suffer