ARD/ZDF – The Journey Is the Reward: 12. RÄStV

Actually, this article should have dealt with comparing Germany’s public service broadcasters current position and those of British PBS. I intended to comment on it since on one hand, there had been the turndown of “Project Kangaroo”, the BBC’s joint venture with ITV and Channel 4. In Germany, on the other hand, the bill much debated for defining the legal foundations to PBS online integration (12th Amendment Act of Broadcast Treaty, abbr.: 12. RÄStV ^{[link broken, 2016-03-10]}) had been signed a few months before.

Please notice: It should have. Having a closer look, each one’s perspective on the bill whether affected or not, reveals some astonishing aspects. After all, even more it looks like a devastated allotment garden after a lively argument from “Picket Fences”.

So what is the point of view of the persons involved? What are the issues the bill deals with it is discussed at primetime? Finally, what is the core of the matter all about?

Eventually, and maybe, there still will be a comparison between Germany and the UK. Let’s see.

Digital Distribution and European Commission are expecting

The bill is not born out of anything similar to passionate love. Not really. In early 2005, the European Commission opened proceedings against Germany because of filed complaints regarding various aspects of financial regularisations of public broadcasting services ^{[link broken, 2016-03-10]}.

Services affected, like ARD and ZDF, to a large extent are financed by fees. Recently, they started boosting online activities. This included media archives offering video and audio streaming for free. This was the day the bill was born. Concedings to the European Commission finally served to the closing of the proceedings. Later on, these concedings were to be integrated into the draft.

If you try to unravel the thicket made of opinions, statements and reactions in the run-up of the bill’s signature – and afterwards as well – at least five stakeholders can be identified. Striving for, or rather being anxious to secure their allotment in tomorrow’s digital garden they reach in as many clashing directions.

Nominated for best leading actor

The European Commission’s interest is the fulfillment of the public purpose of public broadcasting services, in particular including advocating and support of diversity of opinion. PBS are to cover democratic, social and cultural requirements of the audience. The requirement, to “[bring] to the public the benefits of the new audiovisual and information services and the new technologies” (3) must not include financial abuse of fees. Eventually, the Commission expects each country to control its market structure and impact as well as it is to settle complaints. Similar annoyances took place in other countries too.

Of course, it is also the public broadcasting services who advocate support and advance of diversity of opinion. More important is the quest not to stick with conventional broadcast. Taking a look at much hyped convergence of media proves that only digital distribution is flexible enough. It is the only way to cope with market requirements and the expectations of the audience. Critics tend to argue that PBS in Germany (same argument elsewhere: see UK) represent the largest share of the broadcast market. Moreover, they are financed by the government. But this doesn’t apply. 7 Mrd. Euro of paid fees (“Münchner Erklärung”, topic 3) ^{[link broken, 2016-03-10]} do not keep a medium alive. TV as we know it today is going to die. After all, ARD/ZDF are likely to not fulfil their purposes if the audience has left for another platform. Staying with today’s TV means, the internet and any platforms derived as a result of convergence actually won’t be operable by PBS.

First, and obviously expected, dissenting vote taking issue with any digital activity of ARD/ZDF is cast by commercial broadcasting services. Their motivation is rather familiar and easy to understand: Digital offerings by PBS may result in an impact on the existing market because they are substantially financed by fees. It is correct that distortion of competition is to be eliminated. Yet it is a fact too that commercial services not only in Germany are facing economical difficulties.

Does this economical situation evolve from distortion of competition? No. Well, yes. Both. Revenues from advertising on conventional broadcast services substantially are on the decline. But this is due to a shift of investments to online advertising which is to be observed in other countries too.

However, ARD/ZDF benefit from this economical change since they are constrained to just a small amount of advertisements within their programmes. Therefore, one of the main claims of commercial services is to prohibit advertisement in any form within online offerings by PBS. This is agreed on, yet it is not sufficient from a commercial service’s point of view. It is comprehensible since any additional online offering potentially leads to user movement meaning a drop in reach – after all, this might result in even more decreasing revenues in advertising.

Entrance of stakeholder #4. The print media. Outrage at high volume. The protest has been beyond compare: Publishers crossing all political borders joined the bunch to declare their statements within the “Münchner Erklärung” ^{[link broken, 2016-03-10]} – German web outlet of leading daily newspaper Frankfurter Allgemeine Zeitung, FAZ.net, called it a “Brandbrief”, an urgent and warning letter. Signees included: Burda, Springer, Gruner+Jahr, Bauer and more – adding up to the most powerful conglomeration in print media. You may wonder – where is the link?

As with commercial broadcast services, print media is suffering from a severe decrease of revenues from advertising. Probably even worse. Moreover, it is younger audience, whether politically committed or not, who is turning online. The role of user generated content has an considerable effect in this. Users are enabled to exchange information not just as a means of communication (emails, boards etc.). They exchange information on an eye to eye level with the source of information (social networks, platforms like Twitter, blogs, media portals like YouTube). They are participating. Again, additional online offerings by ARD/ZDF appear a threat to publishers. Publishers claim “every means of journalistic presentation [beyond video and audio content] has to cease” (“Münchner Erklärung”, claim (1) ^{[link broken, 2016-03-10]}). Further on, the programme related nature of amending content has to specified and written out in full.

Finally, there is the comparatively low-key stakeholder group of creative people, represented by German Producers Alliance. According to German Producers Alliance media archives offered by PBS restrict development of commercial online media archives. Their Position Paper ^{[link broken, 2016-03-10]} puts emphasis on the fact it counts for unlimited availability as well as for an availability of just one week which is quite common by now. On the one hand criticism is based upon the producers receiving no additional royalties, with PBS stating the online offering is to be viewed as an integral part of the broadcasted programme. On the other hand, licensers from the US and Europe have got to be paid due a change in availability and extended reach (Position Paper of German Producers Alliance referring to 12. RÄStV, article 2.2, clause 4) ^{[link broken, 2016-03-10]}. I must admit, that is a valid objection. Moreover, during the period of availability producers are exclusively obliged to the broadcasting service für distribution. They are not allowed to distribute their works by multiple platforms.

Core of the matter

Framed to be a saviour in highest distress, the draft of the 12th Amendment Act of Broadcast Treaty encompasses the following issues:

The bill’s implementation is about to include a new phrasing and definition of the public broadcasting services’ purposes considering online offerings in particular. PBS online offerings will not feature any advertising. Availability of content commonly is seven days, yet not restricted or limited to this period in every case. If reasonable, the option to keep the content online for a longer period can be considered. Apart from the actual programme, the offering’s content has to consist of programme related content only. There is no precise definition of the Term ‘programme related’ (‘sendungsbezogen’). A ‘flexible’ interpretation appears feasible if well grounded.

Grey is, young friend, all theory – yet life’s quite colourful

Easily there are some downright bendable elements to be identified. Apart from missing the new phrasing of purpose, a few question are to be answered: How? Whereby? Who? Not to mention, why?

Similar to BBC’s Public Value Test in cooperation with Ofcom, a ‘3-Stage Evaluation Proceeding’ is to be introduced to evaluate new offerings. But except for drafts and studies how a test like that might be arranged, there is no description of the actual proceeding to be found unfortunately. Ongoing evaluation proceedings are being kept non-disclosed by ARD/ZDF. However, during the evaluation proceedings third parties are allowed to comment on the project and voice potential reservations. These are being evaluated as well.

The executive committees neither can be characterised as entirely independent. Actually, proceedings are being carried out by the public broadcasting services own committees. Yet, independent experts have to be consulted at least. Though missing transparency doesn’t back one’s confidence in the evaluation proceedings.

Standardised workflows, tools, criteria, benchmarks – no means of implementation is disclosed. In contrast, the committees’ qualification ^{[link broken, 2016-03-10]} might be scrutinised. For example, members of the committee should be familiar with situation and media landscape of other countries to be capable of comparing internationally and thus evaluating national offerings. Regarding a more independent approach, let’s take the UK for comparing just the basics of execution responsibility of the BBC’s Public Value Test to Germany’s evaluation proceedings. The BBC committee (BBC Trust) is involved by evaluating whether public purposes are fulfilled. Yet, the challenging task of evaluating a new offering’s impact on the market is part of the Ofcom’s analysis. “Ofcom is the independent regulator and competition authority for the UK communications industries […]”.

So, what does “programme related content” mean – what does in include? A precise definition as intended by publishers turns out to be difficult. Unpredictability of new concepts and formats in broadcast doesn’t allow for a finalised definition.

Now, did anybody notice it?

You’re right. There is a downright smallish, yes, even negligible minority who is hardly involved. Obviously, I didn’t include them with the list of stakeholders I gave before – the audience.

Convergence of media can’t be ignored. A number of succeeding hardware concepts on one hand (Amazon Kindle), mobile internet applications on the other (e.g. iTunes, YouTube, Twitter), underline the demand for a crossover platform providing informational, scientific, cultural and entertaining offerings as well as communication. Presentation of content is merging into a single content stream, only to be divided by the distribution channels’ hardware. Though even differences in hardware more and more tend to blur. Hence, a distinction of media types in jurisdiction can’t be found reasonable – at least it’s not with respect to the actual debate. Public purpose of ARD/ZDF must include all media in the same way. Questions regarding the fee, such as to which amount and according to which business model fees for public TV should be charged anyway, is to be dealt with elsewhere.

Visionary market and media economy

Nevertheless, the commitment public broadcasting services entered still makes sense. Integration of (conventional) media into internet eliminates natural barriers to enter the market (MEB). The global media market isn’t any longer restricted to national or European broadcast services. Artificial barriers such as national licenses (music industry: country specific iTunes shops) can be found in some environments. Yet they won’t stand all time. Globalisation forces German and European media companies (including public services as well as commercial ones) to face a phenomenon of much higher economic impact: Media platforms, internationally present, like Joost, Hulu, or YouTube which may gain enormous success within a few years. Just like BBC had to realise, multilateral projects might be the only way to keep profits and investments within one’s own country.

Web offerings are highly valuable to all stakeholders. Recycling of content, user satisfaction by service, flexible programme grids, exploitation of the long tail effect by niche slots, low cost evaluation of new concepts, and finally, benefit of direct user communication for programme improvement. None of these benefits can be achieved in conventional broadcast as efficiently.

Neither party benefits from boundary disputes. Sounds like a platitude, true. Admittedly, it is one. However, all parties’ fears have to be dispelt and replaced with relations based on confidence. It backs up an open discussion on new business models and potential revenue sources. A larger scope of view is essential when analysing the global market. One needs a kind of Google Earth like view at international competitors whose substitute product threatens to replace the own one as well as those of direct competitors. German broadcast, and other German (European) media companies must not ignore approaches or business models which might appear strange or even contradictory at first: “Creative Commons are about to come” (Robert Amlung, ZDF Head of Digital Strategy).

An open media platform concept, much like the BBC’s Project Canvas might turn out as the solution to the current debate. The amount of financial support of PBS by fees would have to be re-evaluted. Negative impact on the media market caused by decrease in reach due to an increase of the number of participants (PBS, commercial services, integrated offerings (e.g. YouTube)) should be balanced out soon. Presumably, the threshold to give way to a reversal development is to be set rather low. due to a gain in diversity.

It is the audience who benefits from a wide range of features. Comprehensive diversity of opinion and culture, self-determined programme grids, democratic option to integrate one’s own generated content, and cultural exchange, all within one single platform. It’s the vision of a perfectly cultivated, yet naturally grown garden of media.

Here’s the catch: Broadband supply has to be embellished on a grand scale. One should learn from the mistakes the BBC has made.