Final recommendations for UK Media Bill set out ahead of King's Speech in November

The House of Commons' culture, media and sport select committee has made its final recommendations to the government on the draft Media Bill, addressing significant areas of concern, following pre-legislative scrutiny this summer and before the calendar is set out for the next parliamentary year.

The draft Media Bill final report, which was published on 22 September, calls for an upgrade of public sector broadcasters (PSBs) prominence on connected devices from "appropriate" to "significant", as well as making all video on-demand (VoD) services subject to a stricter code, which steps away from the tiered system initially suggested in the draft bill.

The report also supports calls from PSBs to ensure that unregulated streamers cannot acquire exclusive rights for "crown jewel" sports events, as well as proposing that the bill extends the listed events regime to digital rights (for example, on demand and clips).

The draft bill is expected to be formally announced as part of the government's legislative programme in the King's Speech on 7 November 2023.  The Department for Culture Media and Sport published the long-anticipated proposals for a major overhaul of UK broadcast laws in March, following its white paper in 2022.

Digital PSB prominence

Under current legislation, PSB channels are given prominence on regulated electronic programme guides (EPGs). This does not extend to PSB services made available outside of a regulated EPG, such as those accessed via a rail on a Smart TV user-interface.

To ensure PSB content continues to be easy to find for UK audiences in the context of current viewing habits and distribution trends, the bill requires certain television selection services to give "an appropriate degree of prominence" to PSB internet programme services. The committee reiterates that the intention of this new regime is to capture devices which are primarily used to access television selection services, such as smart TVs and set-up boxes, rather than devices (such as mobile) where delivery of TV is not the core function. The report also makes clear that only those platforms which are "used by a significant number of members of the public in the UK" should be regulated.

During pre-legislative scrutiny, a number of PSB stakeholders queried whether prominence should be upgraded to "significant", pointing to the varying interpretations of the word "appropriate". Concerns were also raised around the potential for platforms to self-preference their own content.

Others, however, argued that there is no clear benefit to upgrading "appropriate" to "significant", particularly as the existing EPG regime refers to an "appropriate" degree of prominence. There were also concerns that "significant" would lead to an overly prescriptive approach.  

Overall the select committee supports using the descriptor "significant" in order to minimise ambiguity and ensure PSB content is easy to find on all devices, noting that what "significant" prominence will look like will vary from device to device.

The committee also recommends enabling Ofcom to exempt some legacy devices from prominence (and presumably must-offer, must-carry obligation), where those devices present significant technical integration barriers for VoD and related streaming services.  

Scrapping the VoD 'tiers'

Currently, linear channels must comply with the full Broadcasting Code, while VoD services operate under a more relaxed regulatory framework. To address this perceived imbalance the bill creates a two-tier system, with larger "Tier 1" VoD services made subject to a new VoD code, applying content and accessibility standards akin to the Broadcasting Code, and a continuation of the current light-touch regime for smaller VoD providers.

A number of VoD services and industry groups have subsequently argued that a tiered system would lead to significant confusion, both in identifying which services qualify as "Tier 1", and because this approach does not appear to meet the policy aim of levelling the playing field between VoD and linear.

The committee has concluded that, if the government wants to achieve their stated aim of ensuring all content is safe and subject to the same standards, all VoD services should be made subject to a new VoD code (in the same manner that all linear broadcasters must comply with the Broadcasting Code).

Listed events and the streaming loophole

The committee has not strayed from the proposal to limit listed event rights to PSBs, rather than allowing other commercial broadcasters to broadcast those events on a free-to-air basis. However, the committee does strongly support closing the perceived 'loophole' for unregulated linear streaming services.

Under the draft bill, an unregulated live streaming service would not be restricted from acquiring the rights for a listed event and putting them behind a paywall. This is because the relevant provisions dealing with these rights only refer to broadcasters and "internet programme services", which does not capture "pure" live streaming services made available outside of an EPG (for example, via an in-app pop-up stream or a live streamed channel delivered via an unregulated Smart TV user interface).

The committee also concludes that digital rights (that is, on-demand and other digital content) should be wrapped up in the new "listed events" regime, such that these will also be reserved exclusively as a PSB benefit. This would be a significant move and would materially impact other broadcasters' and video platforms' ability to engage audiences with popular highlights and clips. 

Must-offer must-carry agreements

The bill proposes an obligation on PSBs to offer their content to platforms, and a reciprocal obligation on platforms to carry that content. These arrangements will be subject to negotiated terms, with the bill setting out three broadly drafted "agreement objectives" aimed at ensuring the parties reach commercial satisfactory and fair terms. If negotiations break down, Ofcom would have powers to step in to ensure these objectives are met.

However, the current drafting of these objectives has drawn significant criticism for its breadth and potential ambiguity. Concerns have therefore been raised that PSBs (and other content providers) will not be sufficiently protected; for example, from practices that materially impact on profits, such as platform terms that reserve a significant portion of the broadcaster's ad inventory and revenue for that platform.

As a result, the committee has asked the government to take another look at the objectives, and suggest referring to examples of successful PSB and platform carriage deals to assist in this process.

Public service remit

The draft bill proposes to simplify the current PSB rules, including removing genre-specific programming requirements. The committee has recommended rowing back on this proposal, for fear of reductions in this type of content.

The committee recommends retaining the flexibility proposed in bill around use of on-demand services to fulfil the public service remit. However, following feedback, there is recognition that the requirement to retain content on a VoD platform for 30 days in order to count towards fulfilling the remit may need to be vary depending on the type of content; for example, it may not be appropriate for news and sports.

Osborne Clarke comment

The committee report goes some way in pushing the government to reconsider and tighten up a number of elements of the draft. In general, the recommendations spell more good news for PSBs and reject concerns from platforms around the technical challenges of compliance. In contrast, the proposals could add weight to the compliance burden on non-PSB services, particularly through universal application of a VoD code.

In relation to listed events, the government launched a consultation on extending regulation to additional electronic programme guides on 20 September 2023, just before to publication of the committee's report. The consultation is open until 15 November 2023.

On its face, however, the approach laid out in the consultation would not necessarily close the loophole identified during pre-legislative scrutiny of the Media Bill – in particular, because many streaming services are made available outside of any form of EPG and often are viewed on mobile and other connected devices.