BBC Licence Fee to be abolished by 2027 | Major Businesses | Business | News | Rapid TV News
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Amid the current political turmoil surrounding that it finds itself in currently, the UK government has angered UK media with plans to freeze for the next two years the main source of funding for the BBC, the Licence Fee, and then ultimately abolish completely over the next six years.
BBC corporate 25March2021
Making the announcement regarding the Licence Fee by Twitter UK culture secretary Nadine Dorries said: “This Licence Fee announcement will be the last. The days of the elderly being threatened with prison sentences and bailiffs knocking on doors, are over. Time now to discuss and debate new ways of funding, supporting and selling great British content.”

The £159 a year Licence Fee covers a bundle of vastly popular TV and radio channels, the web site and services such as the BBC iPlayer. Yet the BBC has been an object of ire over perceived political and cultural bias by the UK’s governing Conservative party since being elected in 2010. Fringe right wing politicians have often called for freezes and abolition of the licence fee.

Analyses made over the year have yet to find a viable alternative to the Licence Fee  In April 2020, research firm Ampere Analysis examined a number of potential alternatives to the Licence Fee and found them all wanting.

In one of the key findings looking at the subscription model, Ampere noted that fundamentally it was unrealistic for the BBC to match current income levels through a subscription fee as which is used by the liked of Netflix and Amazon Prime Video. It said the BBC would need to sign up nearly 24 million households for a whole year, each paying £13 per month, to mimic current funding levels. Current market leaders Sky and Netflix have less than half this number of subscribers apiece. Indeed, Ampere’s analysis indicated that the leading alternative models, with the exception of an income tax, would struggle to generate sufficient income to cover BBC activities, necessitating a scaling-back of output or quality.

In March 2021, the UK government was slammed by a parliamentary committee for its failure to enable a viable and alternative form of funding. The Digital, Culture, Media and Sport Committee (DCMS) Committee, The Future Of Public Service Broadcasting report concluded that the failure meant that the BBC would be forced to rely on the TV Licence Fee  for the term of the next BBC Charter that will lay down the terms of how the corporation operates from 2028-2038. This said the committe raised a real risk that the BBC will struggle even more to compete with digital services such as Netflix, Amazon Prime Video and Disney+.