Tim Davie on the future of the BBC
The director-general of the BBC discusses with Alex Barker who, in an age of streaming and culture wars, who should a public service broadcaster be serving, and how?
You can enable subtitles (captions) in the video player
ALEX BARKER: Now Tim, we all have our own special relationship with the BBC in the UK and you've got vast amounts of news output. You can't possibly monitor it all and watch it all. What do you actually listen and watch on a daily basis?
TIM DAVIE: Personally, I spread it around a bit. So actually, I'm joining in from Glasgow, so I've been with the Good Morning Scotland team and actually, if you believe, the Scottish channel Nine bulletin last night, Alex. So they answer to your question is, I'm immersed in Scottish politics, the Scottish fan zone. So to your, question I do have a broad listening and viewing selection I'll go through. I'll also make sure that the really landmark programmes, whether it's the 6 o'clock news, 10 o'clock news today and Panorama. You're across, that's the job.
ALEX BARKER: And as editor in chief, do you want more decisions coming up to your level or less in the way that you'd be running the BBC?
TIM DAVIE: I think we're pretty well-balanced but certainly, it's not about all of the things coming through the system to me. I mean, in some ways, you can overexaggerate the curiosities of the BBC. Think about if you were running a big retail operation. You need those processes, you need those systems so that store managers in that scenario can make their decisions. For me, empowered good editors with proper process-- I mean, we're making thousands of hours. And to add to your point, we have our traumas, we make big mistakes now and again. But actually, across the world, as we speak today, we've got a brilliant set of editors with very good guidelines delivering very high-quality news coverage. I don't think the system works-- I think it's right that I'm editor in chief and you make those really big calls and you come in and set the tone and do the things you need to. And now and again there's a call, just like there would be in any business, where you've got something of corporate importance. But the answer to your question is no, I think a system that relies on everything in a very hierarchical way, being referred up to the top--
ALEX BARKER: So yesterday, there was a bit of a fuss over royal babies' names. Does that come to you? I mean, was there someone that tapped you on the shoulder?
TIM DAVIE: Bluntly, being very open about it, if something hits the main headlines, I will be briefed to make sure that I am happy with where the corporation is and understand the situation fully, but this is not unmanageable. The BBC does throw them up, as you said in your introduction, on a regular basis. But overall, I make a judgement with my top team on whether something is, if you like, of corporate importance, which, if you think about the other CEOs listening in, that's how it works. The real thing is making sure you've got the guidelines the processes, the quality of editors in place, just as you would have in the FT, that can run their areas efficiently and properly.
ALEX BARKER: And you've made impartiality a big theme since taking over. Do you feel like you've corrected whatever you wanted to correct already or are you going to have to look at more structural changes, as well? Is there are more to come?
TIM DAVIE: This is an ongoing project, yeah. And I've been very open about it, I think, which I think the issue for us was not primarily-- although there's a lot of noise around it-- if you're the national broadcaster, our intent is absolutely to be impartial of a fair and balanced coverage. Yet there's no doubt there's enormous amounts of heat-- I mean, I'm in Scotland, where if you think about the debates around independence and all those things, navigating that course-- and again, people at the FT do the same thing-- politically is one thing, but I think there's something slightly deeper in a more polarised society where you've got, to use your cliche, echo chambers, and the idea that you're not actively seeking out other's opinion, broader, non-metropolitan views. And I just think there is danger in any organisation of a degree of groupthink.
And I think that's going to be something that's-- I do see things that I can look at and say, OK, I'm really pleased. I think when we look at that section of the website, it now seems to really reflect a breadth of concerns and thinking. So I'm pleased where we're going, I'm pleased where we are politically. I think, actually, when we did the local and national elections, I'm proud of our coverage. I think we truly delivered impartial coverage. But to your point, we've got lots of work to do in terms of seeking out different perspectives, people that don't feel they get their voice heard in institutions. We know how valuable that can be. So that is ongoing work and relates all the way back to who we bring into the organisation. This is going to take quite some time.
ALEX BARKER: Yeah. And I mean obviously, the most recent have the Dyson report and the controversy around the Martin Bashir Diana interview and how he was brought into the organisation that's coming out. I mean, do you think you potentially might have people leaving the BBC as a result of those findings in the end? I mean, are you going to have to look at your management team, as well?
TIM DAVIE: Well, it's way too early to speculate. And you won't be surprised, I'm going to wait for the report on the rehiring before I make any conclusions. So yeah, I think, to be honest, as DG in charge-- I mean, that was more recent, but 25 years ago-- a pretty grim affair. I think you know, Alex, I've been very active in saying, let's get to the truth. And it's the same with the rehiring. We'll just be very clear on what happened and make our conclusions from that.
ALEX BARKER: And one of the other things I find extraordinary in terms of how you juggle is being editor in chief, meeting the government, at the same time, being director general and having to negotiate with that government what your budget is going to be and how the BBC changes in the years to come. I mean, what are those conversations like? I mean, how do you manage it?
TIM DAVIE: I think they're fairly rational. And so what I mean by that is I think the lines are clearly drawn in the charter. I think sometimes people overcomplicate things. I mean, we are ferociously independent editorially, we do that without fear or favour. There's no problem with that if you've got the right people. We've also got the director of news, the news operation, everyone, our editorial teams are not involved in that negotiation. And then when I go in, it is a clear discussion. I mean, for those who are experts on the BBC, we've got the next five years of funding to agree with the government. And we're in that process.
ALEX BARKER: I mean last year, I think you went in to see Dom Cummings. You had your political editor with you. Is that as editor in chief or you're talking about the future of the BBC or is it all of it? How does that go?
TIM DAVIE: When I'm meeting, I am the leader of the BBC in the round. I don't find that problematic. I can have a discussion around-- as I say, you go back to the charter and the rules of the road, they're not that complicated to a degree. You go, OK, here's my funding. You are not linking that enough-- it's totally non-negotiable. And you see that, judging from our record on that, yeah? In terms of how we go after stories. If you are the BBC, the one thing you are not going to trade on is independence, impartiality, and reporting without fear or favour.
I would say, by the way, just a little flag way for our system, I think most politicians that I meet across the spectrum value that democratic process. They may have a view that that interview was unfair or that programme or whatever. But by and large, we can beat ourselves up a bit here, by and large, there is general support for a proper functioning media truly going after story-- and we all know this-- impartiality. And they'll all have their gripes, they'll all have their views, but there is general support for that. So I don't have a problem with that. I think that can function. You need strong-willed individuals on both sides of the table who know where the lines are. But it's OK. It's OK, it works.
ALEX BARKER: I mean, shortly after you came in, decriminalisation was shelved. Do you put that down as a win for you? I mean, is that personal--
TIM DAVIE: Forget about me. We thought that was not a smart idea, yeah? And the BBC was-- I mean, it wasn't cryptic. It was very clear that we thought the logic behind decriminalisation of the licence fee was problematic. Two problems, by the way, one is you're either in this system or you're not. I mean, this is a universal intervention. It's slightly strange, but it's a wonder. And it grows the creative industries' works. So to me, it's a precious thing for the UK. And I mean, there's people around the world, I'm sure, on this call-- but it is admired globally, it's one of the things we do pretty well. The second is the alternatives weren't particularly cost effective. So I think I was very pleased we won that argument.
ALEX BARKER: And you mentioned the world and obviously you're more than a national broadcaster, you've got a huge presence and operations. You make money around the world. But on the news side, you said you want to reach a billion viewers and listeners around the world and also think about how to introduce paywalls around some news of actual content and raise money that way. How do you balance those two and how are you going to find the money to actually make a big investment like that outside of the UK?
TIM DAVIE: Yeah, it's a great question, because what you've said there is exactly right. It's the balance in terms of reach and then financial return. And I do think, for what it's worth, I see it differently between news, world service, and, if you like, in fair, trusted, impartial information. I mean, we have reach in places like Afghanistan or other places where commercial income is not on the forefront of my mind. It's about ensuring fair information is getting through there and the BBC. And that's funded partly by the licence fee, partly by the FCDO, so from the government. So clearly, on those objectives, you're not primarily about financial return.
Having said that, for those who don't know, we have the BBC Studios business, which you're referring to, $1.4 billion of revenues, decent profitability, but some real choices now around the paywall. And we are beginning that journey. The question is at what speed you go and how cold turkey you go on your current revenues. There'll be many businesses in the same type of dilemma as they migrate this path.
When it comes to news, to answer your question directly, I think my focus is where we've got areas like the US, where you've got more disposable income, you've got more competition, and you've got scale, I should say, you do, at that point, say you want to be actively looking at making sure you can commercialise. And I am interested in the paywall around some of the news products. And also our factual programming. I mean, we've got a service in the US, BritBox, it's doing really well, but that is more on the drama side. So you will see us make moves in other areas.
ALEX BARKER: I mean, if you were running this, the resource side, I mean, just as a strategy, would you be accelerating that faster to introduce the paywall, even if it takes a lot of pain in terms of the licencing revenues and things that would be lost? I mean, would you go faster as a preference?
TIM DAVIE: Broadly, yes, and I think we need to. Broadly, yes. The reason I'm hedging is--
ALEX BARKER: And so you've made that pitch to the government, presumably, and are they in the mood to--
TIM DAVIE: The issue in the medium term-- I mean, we've said publicly, by the way, that there is a balance here, because you've got your ongoing revenues and we want to keep delivering competitive margins. So the question is how much you can invest, because these things are-- again, there'll be a lot of people on this call who get this-- moving to that digital models is not necessarily cash accretive in the next five years, as you know. Look at the debt profile on half of these journeys. So I think we're balancing that. I do think it's slightly complicated for us. I don't like adding complication for the sake of it, because some of it is simple, by the way, moving to paywall in some areas makes total sense. We can move aggressively and we've done so and we will continue to do more.
And to your point, can we move faster, I'd like to, yeah. I think there's some areas where you're creating content together, whether it's major natural history landmarks, some of these really big dramas, where, actually, co-production partners-- and it's a finely balanced decision about whether you're buying all the rights up front and putting it to your own service or you're going into co-production, limiting your cash risk upfront. And actually, that works, because the primary revenue for me is, of course, making sure the licence fee is great value for money. And my strategy is very simple, BBC's strategy is very simple. It's not focused on politicians or anyone else. It's focused on do you and your family get 159 pounds of value for every household? And in some ways, co-production and securing that content is probably one the key bits of jeopardy for the BBC. So it's not necessarily all about direct to consumer.
ALEX BARKER: OK. And actually, I'm going to draw on one of the questions that came in that comes to that point is, how do you manage to justify financially the BBC's huge interest in investments in international news and the international operation to some degree when, ultimately, you are responsible to the taxpayer?
TIM DAVIE: It's a very fair question. I think the international news is one thing, and I think that is easily justifiable, which is clearly, I think, one of the things we bring to UK audiences. And one thing that I've always valued about the BBC as someone who used to be a consumer, rather than an executive, is that international coverage and truly understanding what's going on around the world. It's clearly a value. It's part of the UK's DNA, I think. On the services, radio, online, television, beyond the UK's borders, that is a blended funding. So you're spending about 250 million of the licence fee as 3.7 billion and you've got 90-odd million from government on that. So it is a blended fund. And I do think there's something about the UK economy-- by the way, the stats are pretty good on this-- and where we are in the UK. It does make sense to spend a proportion of that UK revenue on making sure we've got good global presence. And by the way, the whole thing works together. The bureaus and the services. But I do think your question is well-put. There is a limit to that. And I think we're at a pretty good situation now.
ALEX BARKER: Would you want to see the borrowing limit of the BBC raise so you could actually invest in some of the international commercial side, from borrowing rather than--
TIM DAVIE: Yeah. I think on the commercial side, there is a case to say we do have very low gearing. I mean, the truth of this is you can normally get-- I mean, again, as people know, there's plenty of capital out there. It's a question of what the cost of capital is. And I'm not just talking payments. I'm talking, are you giving up equity, IP, and productions? I think there is a case that says, actually, from a UK PLC point of view, BBC Studios is in a unique position to grow its IP. And there is a case for more borrowing, yes, and that's a conversation we're engaged in.
ALEX BARKER: How much? I mean, if the borrowing limit is at--
TIM DAVIE: I don't want to go into exact levels at the moment, Alex, because I do think that's part of the discussions with government. But I do think there's a case. Let's leave it there, yeah.
ALEX BARKER: OK, so another question that's related is how important is advertising revenue to the BBC internationally and how much of a priority is it moving forward? I mean, particularly if you're going behind paywalls for some factual news, et cetera? How do you make that balance with advertising?
TIM DAVIE: It's still pretty critical in terms of-- but the longer term picture, if you look at our growth in our revenues, I think there's two areas where our commercial revenue looks very exciting. One is production. I mean, this is a bit in the beltway, but we've got this incredible, world class-- think about our natural history unit or our documentary unit or our dramas. We've only been making for the BBC, now we make for anyone. In the latest vectors one of the Netflix award winners was actually made by BBC Studios. Yeah? Surgeon's Cut, that's the programme plug. So what I'm saying there is there's plenty of revenue-- sorry, I'm not answering the question, becomes that's where there's a lot of revenue growth.
The other is if you take BritBox, you take some of our D2C plays, lots of growth there. So look, the advertising slug is hundreds of millions and it's important. We've got our traditional channel business. There will be more, I think, blended models, where you've got advertising and ad-funded and advertising video on demand. But if I'm being really honest, it's not the real area of growth for us. The real area is subscription growth and production revenue and IP growth. They're the real motives of the business going forward.
ALEX BARKER: Just to change gears, we've got a question on scandals of the country. I mean, you were acting DG after George Entwistle had to step aside because of the Jimmy Savile scandal in 2012. How do you compare the current Bashir scandal with that? Is it as damaging reputationally? And are the other common threads between the two in terms of poor oversight and editorial judgement?
TIM DAVIE: It's really difficult to benchmark these things, isn't it? Because they're asymmetric. I mean, they're different shapes. Look, I think the truth is that you can manage these scandals, but the worry for us is our system is based on trust. The impartiality and trust are sacrosanct for that. And you can give up trust, as the leaders on this call know, you can give up trust quite quickly. Takes a lot of work to build it back. And I think there are similarities. I mean, I don't want to benchmark it. I mean, I think the Savile case was really very, very disturbing in terms of the deep history of what went on there. And if you think about the impact, it's very severe. Martin Bashir, a very serious incident, as well. The worry-- I mean, in terms of leadership, what I would say is you want to be very accountable. I think this is difficult for leaders sometimes to say, look, we just want to get at the truth. However uncomfortable, just get at it, which has always been the way I want to work. And then building back trust, I don't think you can do it in a tokenistic way. You've got to do it day in, day out, and build it back. And I think there, that's the learnings. I mean as I say, you can lose it quickly.
ALEX BARKER: So I mean, in both of these circumstances, you've had situations where you're having to criticise, potentially, your predecessors or your predecessors' actions. How do you weigh that up? I mean, it must be pretty uncomfortable, particularly when you work with these people that have been your mentors over the years.
TIM DAVIE: These are really tough things to do. But at the end of the day, like anyone leading, you act in the corporate interest, you try to act fairly, but really making sure that you are accountable and you're getting after the truth. The one thing I've learned in life is you've just got to go and get the facts and share them openly. And if you don't do that, I think-- I'm less interested, if I'm being really provocative, about comms and this, how do we spin the story? Forget all that. My learnings are very clear. You go and find out what happened. You just deal with it. And I think if you do that, you can move on. I think in this age, it's an age in which accountability is everything. You need to be accountable, you need to show what you're doing. And I think it's all out there. But I do think they're very concerning instances, but you've just got to build back trust.
The final thing I would say is you've got to keep perspective, as well. You know, we're delivering thousands of hours a day, really good programming. If you go out in Glasgow here and talk to people, they are interested in what's on at 9 o'clock tonight. They're interested in the dramas, they're interested in how we deliver our local news coverage. So in terms of keeping your own perspective on this, I think it's really important you get close to audiences and listen to them with the greatest respect, not just the inner press bubble. Do you know I mean? I think that is important for CEOs.
ALEX BARKER: It's a very fine audience. Very final thing, we've got about a minute left, and I'm going to ask this in two ways. We've got the question came in, to what extent would you say the culture wars have cut through to a broad UK audience and how has that informed your coverage? And secondary to that, we've got Andrew Neil coming up in about five minutes who I'll be interviewing, do you want to GB News to succeed?
TIM DAVIE: You're going to get the diplomatic answer, which happens to be true, Alex, which is I absolutely think we've always, since I was growing up, we've had different media sources. Polarity is absolutely critical to the UK market. And I absolutely think that we should embrace it, learn from it. I don't think there should be any arrogance on our part. There's probably stuff I'll learn from Andrew. I've got enormous time for Andrew. I'm sure he's going to do a few things in GB News that I'll want to learn from. That's how we should treat this. And I think the last thing we'll do is say, you know, this isn't serious competition or describe them in cliched terms. I'm sure there'll be lots of things they do very well and Andrew is a very accomplished journalist and I think we'll learn.
On culture wars, by the way, welcome to modern Britain. I think navigating that, listening to different perspectives, being comfortable, by the way, of opening up different opinions, that's the game. That's the game now. And I think everyone in my generation is walking a bit of a tightrope, but hey ho, that's what we've got to do and enjoy it a little bit if we can.
ALEX BARKER: Thank you. We are overrun already, so I've got a couple of minutes before Andrew just to say a big thank you to you, Tim. Appreciate your time--
TIM DAVIE: As well.
ALEX BARKER: --and for being open with it. All right. Thank you very much.
TIM DAVIE: Thanks very much.
ALEX BARKER: And join us again in a few minutes with Andrew Neil. Thanks.
TIM DAVIE: Bye.