27 October 2010

BBC World Service considers hosting Ads on some foreign-language Websites

Guardian UK

The BBC's director of global news, Peter Horrocks, has revealed the corporation is looking at introducing advertising on some of the World Service's 31 foreign-language websites as part of a "seismic shift" for the whole organisation.

Hosting advertising on some of the World Service's language sites could provide new revenue for the BBC, Horrocks told staff today. The idea is being considered as BBC executives work out the practical implications of this week's licence fee settlement, which will see £140m-a-year cut from the corporation's annual £3.6bn budget, plus additional funding commitments including the World Service.

George Osborne confirmed on Wednesday that the BBC will see its budget cut by 16%, as well as take on responsibility for funding the World Service and BBC Monitoring by 2015, and provide most of S4C's budget. In addition the BBC licence fee will be used to help meet the cost of rolling out broadband internet access to rural areas and establish local TV and online news services.

The World Service budget will also fall by 16% over four years, Osborne said. Its annual foreign office grant currently stands at £272m.

"With commercial and the World Service there are some possibilities," Horrocks told a gathering of global news staff. "Fundamentally, public money to support journalism is likely to be in places where the media is not free or [in] a proper market – but in some areas and more advanced markets, there could be potential for blending things together and that could be a sensible thing.

"Dot com [the international news site run by BBC Worldwide] already has adverts so the logical step could be an income stream for World Service language sites. That's just an idea, not a policy."

A BBC World Service spokesman confirmed that opportunities to increase the World Service's commercial income were being considered.

Addressing staff concerns in an internal session lasting more than an hour, Horrocks conceded that there would have to be job losses to meet the scale of the savings required in what is "clearly a seismic shift and will have huge implications for the whole of the organisation".

"Until just a few days ago we were working on the assumption that the settlement was just about the World Service," he said. "It is now clear that this is a fundamental change for the whole of the BBC, not just global services."

Horrocks confirmed that the BBC executive board were looking at possible closures of World Service operations "where the need [for a World Service presence] is least and the impact [of closure] is lowest – all of these things can be assessed".

"For international language services the consideration of need is the most legitimate thing to take into account," he added.

The World Service will announce where the majority of the savings will be made in late November, though there will be a series of announcements in the coming weeks. "The board are now looking carefully at the funding settlement and at where we can revise plans and obtain approvals," Horrocks said.

He added that he received assurances on Wednesday morning from William Hague, the foreign secretary, that the government still "buys the argument that [the World Service is] a huge asset for the UK".

From April 2011, the World Service will need to deliver cumulative savings of around £67m over four years. "That equates to more than 25% of the current costs. It is a very steep task indeed," Horrocks said.

The coalition government's comprehensive spending review, published yesterday , advised that the BBC World Service and the British Council should "find savings by finding greater efficiencies and enhancing the commercialisation of their operations".

Some World Service insiders are anticipating certain foreign-language websites could take advertising as early as the first quarter of next year. It is understood that work combining these sites with World News TV Online, which already has ads, is "well advanced".

An update to the content production system used by staff across BBC Online, and launched just before the summer, introduced the ability to select an advertising campaign to sit alongside articles, MediaGuardian.co.uk has learned. Previous versions did not have this capability.

Asked to comment on the proposals, a spokesman for BBC Global News said: "BBC World Service already makes £4m in commercial revenues which are ploughed back into our services for audiences. The government are encouraging us, in the settlement, to exploit opportunties to increase this figure further. We will be looking at all possibilities but this will be a very small part of the huge challenge ahead for BBC World Service.

"The priority for BBC World Service is to manage a real-terms cut in our grant of 16% over the next four financial years; plus extra costs like pensions which we estimate will take that figure closer to 28% of our income – we estimate some £67m over the period.

The BBC launched advertising on its BBC.com international news site in November 2007, and moved to stave off criticism by appointing an "editorial guardian" to ensure that ads did not compromise the corporation's journalism.

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