TV viewers have labelled proposals to introduce new charges to transmit ITV, Channel 4 and Channel 5 programmes over pay TV networks a new TV tax and a “rip off”, according to a new survey.
In what is the most comprehensive survey to date into the proposed charges, 73% of people said the plans for retransmission fees would amount to a new tax on watching TV. After reading more about the tax, 72% said the new charge would be a “bad idea”.
The survey of 2,001 people for Virgin Media comes as UK commercial public service broadcasters (PSBs) are calling for the introduction of retransmission fees. This would be a charge to carry their programmes, levied on pay TV providers.
Earlier in the year the Government held a public consultation on plans to introduce the fees, with a decision expected at the end of the year. Recent reports also suggest that the Government is seeking to repeal Section 73 of the Copyright, Design and Patents Act 1988which would open the door for retransmission fees on cable companies only.
But the introduction of fees would mean increased costs for TV viewers: 77% of people believe that Pay TV providers would cover the retransmission charge by raising the price of TV packages . This would come in addition to the significant advertising revenues these commercial PSBs get from their prominent position on Pay TV platforms such as Virgin Media providing free access to tens of millions of viewers.
Commercial negotiations between the PSBs and pay TV providers may result in the channels pushed lower down in the TV menus (electronic programming guides). Instead of slots 3,4 and 5 they could move to 59 or 148, for example. When asked about this potential change, more than three-quarters of people (77%) said they would prefer these channels to stay in slots 3, 4 and 5.
The survey also shows that a third of people said they would be less likely to watch ITV, Channel 4 and Channel 5 if they were lower down the programming guide. A loss in viewership could lead to a decline in advertising revenues for these broadcasters, undermining the limited financial benefits to come from a retransmission fee.
When asked about the extra income this fee would bring to commercial PSBs, 76% of TV viewers did not see the need to pay extra when commercial broadcasters already earn money from advertisements, with 71% labelling this double payment a “rip off.” Instead, two-thirds of people said that commercial PSBs should focus on getting more viewers so they can make more money from advertisements rather than introducing new charges.
If the fee was introduced then two-thirds of people said that commercial broadcasters should significantly reduce the amount of TV advertising. Some 63% believe that commercial PSBs are looking to introduce these fees as a way to increase their profit margins.
Tom Mockridge, CEO of Virgin Media, said: “Retransmission fees are just a fancy term for a TV tax – a tax on programming that people already pay for through the large amounts of advertising they see between programmes. TV viewers have given a resounding thumbs-down to the idea. The Government must take note.”