Murdoch's McTaggart

News International's business is based in the UK on three things:

- print, which is suffering a major advertising downturn on top of the profound disruption of digital, and needs to persuade readers to pay for news online.

- Satellite distribution, which is being undermined by the promise of broadband and IPTV and the interactivity, greater consumer choice and lower costs they offer.

- Premium content and sports rights, potentially undermined by Ofcom proposals to force it to share with rival broadcasters.

So perhaps the least surprising event of the summer was that James Murdoch would use the platform of the McTaggart Lecture to swipe out at Ofcom and the BBC. Whether or not you agree with his ideology, it was a bravura performance. 

He cited Orwell's 1984 and the threat of an authoritarian future while indulging in his own form of Newspeak. Just as Fox News tries to redefine "Fair and Balanced" as meaning Pro-Republican, so  for Murdoch public funding equals "state sponsored" with all its authoritarian overtones, and Independence is now equated with profit. It's more than semantics. This is how terms of debate are shifted. Though I doubt I was the only one to be struck by the Gordon Gekko cadence of his pay off line: "The only reliable, durable, and perpetual guarantor of independence is profit."   

The debate over the right mix of funding and regulation for Britain's digital media will run for a year or two yet. And no-one in the BBC can be unaware of the arguments and allegations about market distortion. 

What's missing so far is discussion of the public good. Because many commercial operations are struggling, the answer for some is to close or pull down the BBC's activities. A lowest common-denominator approach. Surely part of the justification for public funding and public media is to provide during conditions of market failure?

I certainly don't agree that the market, unfettered, will provide all the public require. I'm with the BBC's Robert Peston: “Having just lived through the greatest failure in history to distribute financial resources in an efficient and equitable way, we certainly shouldn’t assume that a commercial digital market in news will distribute information in a way that would support a healthy democracy."

 Will Hutton put it colourfully in The Observer, "The biggest risk is not of an Orwellian state. It is that our society is being taken over by a new class of super-rich unaccountable oligarchs – in finance and in the media – with little interest in our culture, civilisation or vitality of our public realm."

The threat of a media giant distorting markets plays more than one way. Ask Virgin, BT or others trying to compete with Sky. 

Comments

[DB]

"Fox News tries to redefine "Fair and Balanced" as meaning Pro-Republican"

In the same way the BBC tries to redefine "impartial" as meaning Anti-Republican.

[Save the BBC from its employees]

You mention "market failure" as if it is a completely accepted and relatively widespread phenomenon. In doing so, you reveal your own (and indeed the BBC's) political perspective.

Many argue that the intervention by the State (or in this case a publicly funded broadcaster)may end up causing more problems than the "failure" they seek to ameliorate. I think this is in fact close to Murdoch's argument.

As far as I can see, market failure is cited far too often by Leftist commentators and activists. They seek to achieve a sheen of academic/factual respectability for what is often just a sloppily casual (and ultimately self-interested) appeal for a handout from taxpayers. There are probably a few very specific and rare conditions that actually result in proper market failure. The rest of the time, it is merely that someone wants public subsidy for producing something that very few people (apart from them) want.

Supporters of the BBC (I am one) would do well not to present the choice for the future as an "all or nothing" choice. I.e. Either you can have the BBC exactly as it is currently or you can't have it at all. If presented with such a choice, they may find the British public chooses not to have one at all.

[Richard S]

I think that's exactly Murdoch's view. It's a perfectly rational view - just one I don't share, partly because I think there's rather more to market failure than you allow. I completely agree that the choice for the BBC has to be more than "all or nothing" - although I think there is more support among the British Public than you assume. (Btw, shame you're not prepared to comment under your own name....)