BBC in crisis as 300,000 ditch licence fee amid warnings that £285m’ blackhole looming

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In recent years, experts have warned that the BBC faces big financial challenges that could affect its future. With many in the UK turning their backs on the licence fee, and younger audiences flocking to streaming sites like Netflix, many argue that the public service broadcaster must change tack if it is to guarantee its survival. 

Just how bad has it got for the BBC?

Last year, 300,000 people stopped paying the licence fee in the UK – meaning a considerable 24.9million are left still paying the £159 charge.

Over the last four years, however, around one million people decided to stop paying.

Viewing figures do not paint a terribly promising picture either – the BBC’s 2021/22 Annual Report showed that the amount of people tuning in to the BBC One channel fell by two percent.

The report also showed how younger audiences, who the BBC want to convert into future licence fee payers, are being won over by platforms such as Disney Plus and Netflix.

Last year, the percentage of seven to twelve year olds who used the BBC Children’s and Education content across TV/iPlayer or online fell by 10 percent from 56 to 46 percent.

The report also said: “Our performance is trending down, especially among 7-12s, amidst the focus of global media companies on under-16s.

“Some pre-pandemic trends have re-emerged – overall broadcast TV viewing, for example, is well down on both last year and pre-Covid times.”

It added, however, that the BBC is the “only UK provider to contend with YouTube and Netflix among under 16s and 16-34s.”

Among ethnic minorities, the picture is similarly bleak.

The proportion of over-16s in these groups who tune in to the BBC fell by four percent.

While 75 percent of white viewers over 16 watch the public broadcaster, this figure stands at a far lower 57 percent for ethnic minorities.

The BBC now faces a fresh wave of problems after Culture Secretary Nadine Dorries announced in January that the licence fee will be frozen for the next two years and then completely abolished in 2027.

Ms 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 BBC’s Director General, Tim Davie, warned that the policy will leave a £285million funding gap for the broadcaster.

He added: We are disappointed, we would have liked to have seen an inflation rise throughout the period. We’ve got four out of six years and on we go.

“I would say having certainty of income for six years – as you know the media market moving so fast – is very material to us.

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“Our estimate is – and just to set this clearly for everyone – by the year end 2027, the licence fee income will be about £4.2billion based on our assumptions around inflation, obviously guessing games around inflation are obviously difficult. We know this settlement … gives a £285m gap at the end of the period.”

As a result, the BBC was forced into job cuts.

Earlier this month, it was reported that the BBC News channel and BBC World News will sack presenters as part of a raft of 70 job cuts.

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