THE DRAFT MEDIA BILL: A FIRST LOOK

The UK Government published the long anticipated first draft of the Media Bill (the "Draft Bill") today (the Draft Bill can be read in full here, and the accompanying explanatory notes are set out here).

The Draft Bill aims to update the regulatory framework for public service broadcasters ("PSBs") and was introduced against an ongoing 'battle to attract and retain audiences' in the broadcast market, with 'changes to viewing habits' putting traditional broadcasters under 'unprecedented pressure'.

The Draft Bill follows the publication of 'The government's vision for the broadcasting sector' (the "White Paper") on 28 April 2022 (set out here), and was formally announced on 10 May 2022 in the Queen's Speech (set out here). The House of Commons also published the policy background on The Draft Bill on 28 February 2023 (read in full here).

From this journey, at a high level the Draft Bill generally tracks against the expected proposals laid out in the White Paper (as updated by the background policy document in February 2023) in a number of areas. The Draft Bill will continue to move through the legislative process and we will continue to review the detail of the Draft Bill, but we have set out below some of the key takeaways in the meantime.

AIMS

The Draft Bill focuses on PSBs and aims to 'level the playing field with global streaming giants' and 'give these brilliant broadcasters…the tools to keep doing what they do best'. The Draft Bill intends to 'modernise decades-old legislation' (namely the Communications Act 2003 and Broadcasting Act 1990) to reflect changes in content consumption habits. The key proposals to achieve these aims include:

• enabling PSBs and UK radio stations to better compete with global streaming giants and internet radio stations, respectively;
• increasing the accountability of video on demand ("VoD") services;
• allowing PSBs to produce 'more top quality British content'; and
• improving the accessibility of VoD services.

LEVELLING THE PLAYING FIELD

VoD

Most VoD services are not covered by Ofcom's existing Broadcasting Code (which sets the standards for harmful, offensive and accurate material on television), and some VoD services are not regulated in the UK at all. The Draft Bill proposes that certain VoD services, such as Netflix, Amazon Prime, and Disney+, be brought under a new Ofcom code to protect viewers from a wider range of 'harmful material', such as 'misleading health claims'.

Ofcom will have powers to investigate and enforce standards, including the power to issue fines of up to £250,000 or 5% of qualifying worldwide revenue (whichever is higher). In the 'most serious and repeated cases', Ofcom will be able to restrict a VoD service's availability in the UK. The new Ofcom powers will apply to 'Tier 1’ VoD services (expected to be the larger and most TV-like / higher risk services), which are those provided by PSBs (other than the BBC), and those designated as Tier 1 via regulations made by the Secretary of State (these may be UK or non-UK services).

Secondly, the 'Listed Event Regime' will be updated to make the qualification dependent on being both free to air and a PSB and extended to also apply to "internet programme services" (in addition to the original "television programme services"), allowing PSBs to continue to benefit from the regime. In parallel the Department for Digital, Culture, Media and Sport is continuing to review the relative importance of digital rights for listed events following guidance on its listed events digital rights review in November 2022.

This more regulated approach is in response to the changing broadcasting landscape brought about by new technologies and changing viewing habits; particularly with the rise in popularity of streaming and internet-delivered services.

PSBs

The Draft Bill also introduces simpler and more flexible requirements for fulfilment of the PSB remit in a digital age. Again, this reflects the aim of the Draft Bill to allow PSBs to compete with global giants and mainstream VoD services more effectively by adapting to consumer preferences.

Radio

In a new addition that was not set out in the White Paper, the Draft Bill requires all smart speaker platforms, such as Amazon, to provide access to all licensed UK radio stations, regardless of size. The platforms will be prohibited from charging these stations a hosting fee and from overlaying their own adverts on top of those stations' programmes. This is in an effort to preserve the number of listeners on UK radio stations, in light of increasing use of internet-based radio stations instead.

CONTENT

The greater flexibility envisaged in how the PSBs deliver their remit includes on demand programming now counting towards the PSB quota, rather than just linear programming. These changes have been accompanied by new Ofcom powers, which include allowing Ofcom to require a PSB to produce more of a certain type of content, if appropriate and proportionate where audiences are being underserved.

Separately, The Draft Bill also provides that Channel 4 (which will continue to remain in public ownership) will now be permitted to produce its own content and be given greater powers to assess its own PSB remit fulfilment (which had previously been assessed by Ofcom).

Commercial radio stations will also benefit from this increased flexibility, as stations will have less stringent format, genre, and age group requirements, and be given increased power to amend their services without needing consent from Ofcom. It is thought that these changes could save the radio industry 'up to £1 million per year'.

PROMINENCE AND ACCESSIBILITY

Smart TVs, set-top boxes and streaming sticks will be required to ensure that viewers can more easily access and discover PSB services, such as BBC iPlayer. Again, this aims to increase and maintain the prominence of PSB services. S4C will also be boosted by The Draft Bill, with the removal of its broadcasting geographic restrictions, to ensure its UK and global reach is strengthened. Further, The Draft Bill also prescribes certain minimum requirements on all VoD Services in relation to their accessibility offerings.

Maria Kyriacou, Paramount Global's President for Broadcast and Studios, International Markets "welcome[d] the publication of the draft Media Bill" referring to it as "vitally important new legislation to ensure that prominence for Public Service Broadcasters is maintained in the age of the smart TV." Channel 5 is a wholly owned subsidiary of Paramount Global.

NEXT STEPS

It has been made clear that some topics referred to in the White Paper are still under discussion. For example, the government continues to re-consider the BBC's funding model (to assist the BBC in diversifying its income streams beyond reliance on the licence fee) ahead of the next Charter Review (due to be completed by 2027).

The Draft Bill has not yet been introduced to Parliament, but the Government remains 'fully committed' to doing so, with timings to be confirmed. The Government has also stated it will continue to engage with the industry stakeholders, to ensure that the Draft Bill fulfils its intentions.