Memorandum submitted by the British Internet
Publishers' Alliance (BIPA)
The British Internet Publishers' Alliance represents
the interests of commercial Internet publishers who are committed
to ensuring a free and competitive Internet environment. BIPA
will in due course be submitting written evidence to the Committee
concerning issues of fairness and market distortion on the Internet.
There are however a number of broader issues of practice and principle,
concerning the impact of new BBC services, which may be pertinent
to raise with some of your early invited witnesses, most notably
the ITC and the OFT.
With respect to the ITC, on the current question
of approval for the new digital BBC3 Channel, the Commission has
become involved for the first time in representing the interests
of commercial broadcasters, who feel that the BBC's proposals
will make heavy inroads into their income. The ITC put together
research for Tessa Jowell on the commercial impact, which it assesses
at £25 million per annum, against the BBC submission figure
of £4 million.
The wider questions are relevant to the areas
of the draft Bill which relate to the application of competition
policy to the BBC's broadcasting channels, as well as their Internet
services. These include:
1. Compared with the requirements of commercial
broadcast licences, are the current criteria for approvals for
new BBC services sufficiently clear, and adequately open to public
examination and comment?
2. The ITC has become involved in assisting
the DCMS assessment of the market impact of the new BBC digital
television channel BBC-3:
does the ITC think that OFCOM might
have a similarly useful role in advising the Secretary of State
on the broader sector implications of all new BBC services?
given the BBC-3 discussions, is such
an involvement now necessary in view of the impact of BBC services
on commercial competitors?
3. If OFCOM is not to have this input, can
increasingly complex judgements of commercial impact be handled
effectively by either departmental civil servants or the BBC Governors?
4. Should OFCOM have a professional role
in monitoring whether or not the BBC meets the remit of particular
service approvals? Again, if not OFCOM, have departmental officials
or BBC Governors the necessary resources (and in the latter case
the manifest impartiality) to fulfil this function?
5. Should OFCOM be specifically empowered
to apply competition policy to the BBC, or at least to advise
the Secretary of State on competition related issues?
With respect to the Office of Fair Trading (OFT)
the core issue is the degree to which it (or after the enactment
of the Bill, OFCOM too) has adequate power to ensure that the
BBC's Fair Trading Commitments are adequate in themselves, are
fully transparent, and are subject to effective scrutiny and (where
necessary) appropriate sanctions.
Where the private sector has referred concerns
about unfair competition to the OFT, there appears to have been
a reluctance to act. Consequently, the BBC maintains an apparent
record of fair play. In our evidence to the Committee we will
provide more of the details of this, but in the meantime the key
question is whether the structure of self-regulation is sufficient
for an increasingly complex market. Key questions include:
A. How often have questions concerning the
market effect of BBC services been referred to the OFT?
B. Does OFT treat issues concerning the
BBC in the same manner as those concerning purely commercial organisations?
C. The BBC is required to comply with its
Royal Charter and Agreement, and to observe its Fair Trading Commitment.
Do these in any way replace or reduce the impact of general competition
law on the BBC, or the willingness of OFT to apply it?
D. New BBC services are approved by the
Secretary of State for Media Culture and Sport. Does OFT believe
that these approvals are:
(a) conducted with proper regard to their
impact on fair trading, and
(b) sufficiently precise and public in their
E. If the special status of the BBC protects
it from the full rigours of competition law, does thisshould
thisapply to all BBC activities of whatever kind and scale,
even if not directly related to broadcasting?
F. What specific competition powers should
OFCOM be able to exercise in these areas?
G. DCMS has commissioned an enquiry into
BBC News 24 by Richard Lambert. Is such a one-off enquiry a sufficient
test of the delivery of the BBC's agreements on this service,
and its effect on the market?