Public Value Assessment
21 November 2008
1. Executive Summary 5
2. Approach to Assessment 12
3. Executive Proposal and Strategy for Local News 17
4. External Context 20
5. Perceptions of ‘Local’ 22
6. The BBC Trust's Assessment 24
7. Counterfactual 56
8. Conclusions 59
I Description of Proposals 63
II Trust Assessment on Reach 74
III Trust Assessment on Quality 85
Glossary of Terms
ABC1 Social grades classification relating to occupation, ABC1
encompasses managerial, professional, administrative and
Charter The current Royal Charter governing the BBC
Click-through A measure of the number of times a particular link on a web page
has been clicked
C2DE Social grades classification relating to occupation, C2DE
encompasses skilled, semi-skilled and unskilled manual workers,
pensioners and those dependent on the state for their income
DTT Digital terrestrial television (also known as Freeview)
Embedded content Content, usually media, from another website or source that is
included seamlessly within the body of a website, in many cases
users can take embedded content and add it to the body of their
pages/social sites instead of linking back to the original source
Framework Agreement Framework Agreement dated July 2006 between the BBC and
the Secretary of State for Culture, Media and Sport. also referred
to in the PVA as the ‘Agreement’
GPS Global Positioning System, a satellite-based navigation system,
commonly used in mobile phones, which can be used to pinpoint
IP Internet protocol, a method by which data (e.g. email, video) are
sent from one computer to another on the internet
IP-enabled A device capable of connecting to the internet, whether through
a fixed connection (e.g. broadband or cable TV), or wirelessly
(e.g. over mobile networks or WiFi)
iPlayer Online, on-demand catch-up BBC service, which allows users to
watch BBC programmes from the previous seven days
Linear content Refers to scheduled broadcast television content
MIA Market impact assessment, undertaken by Ofcom to assess the
market impact of new BBC proposals. This forms part of the
public value test, below
On-demand Allows users to select, stream or download, store and view film
and television programmes, usually within a certain timeframe,
using a digital cable box or online service
PVA Public value assessment, undertaken by the BBC Trust to assess
the value of BBC proposals, including value to licence fee payers,
value for money and wider societal value. This forms part of the
public value test, below
PVT Public value test; significant changes to the BBC's UK Public
Services must be subject to full and public scrutiny. The means by
which this scrutiny takes place is the public value test. A PVT is a
thorough evidence-based process which considers both the
public value and market impact of proposals. During PVTs, the
BBC Trust will consult the public to ensure its decisions are
properly informed by those who pay for the BBC
Q&A Question and answer
Reach Measures reach of BBC’s service to its audience
Service licence The BBC Trust aims to ensure that the BBC offers high quality
and original services for all licence fee payers. To help deliver
this, it sets out the remit and expectations for each BBC service
– and how that service will create public value by delivering the
BBC's public purposes – in a published licence
UGC User generated content (text, video etc) produced by end-users
as opposed to traditional media producers, broadcasters,
Any other defined terms used are taken from the BBC's Framework Agreement, unless
1. Executive Summary
1.1.1 In May 2008, the BBC Executive (‘Executive’) submitted proposals to the BBC Trust
(‘Trust’) to provide an on-demand, local video service, delivered via fixed and mobile
broadband internet connections (‘local video’). The Trust considered that the
proposals constitute a significant change to an existing service (under the Charter and
Agreement) and should be subject to a Public Value Test (‘PVT’).
1.1.2 This document sets out the Trust’s position on the public value of the local video
proposals. Ofcom’s Market Impact Assessment (‘MIA’) is published separately.
1.2 Description of Proposals
1.2.1 The Executive has submitted a proposal to provide an on-demand, local video service,
delivered via fixed and mobile broadband internet connections. At launch, the service
would not be available on any other platform. 1
1.2.2 Local video would expand upon the BBC’s existing network of local websites.2 It would
be available in 60 areas across the UK, most of which cover an area of more than
250,000 people (and on average, one million);3 equivalent to the coverage of the BBC’s
existing network of local websites and radio services. In Wales, local sites would be
available in both English and Welsh, bringing the total number of local services to 65.
1.2.3 The service would offer bespoke video, focused chiefly on news and sport, but also
including weather, user generated content4 and knowledge-building genres (for
example, science, nature, heritage, history, arts, culture and faith).
1.2.4 The service would add a new tier of local video newsgathering to local news provision
on bbc.co.uk. Content would be produced locally in, and for, each of the 60 areas. It
would be free at the point of use, without advertising, and available across the whole
of the UK for broadband users.
1.2.5 Local video would have an annual operating budget of £23 million by 2012/135 and
around [REDACTED] staff. It would expand upon and sit within existing local
provision on bbc.co.uk.6
A service description can be found in annex I
BBC Local, formerly known as ‘Where I Live’
In 11 of the proposed local video areas, the population is below 250,000, these are: Highlands and Islands,
South West Wales – Welsh, North West Wales – Welsh, Mid Wales – English, Cardiff and South East Wales
– Welsh, North East Wales – Welsh, North West Wales – English, Jersey, Isle of Man, Mid-Wales – Welsh,
Produced in collaboration with the BBC
Since completing the PVA, the Executive has suggested re-phasing investment in local video, which means it
would not reach maturity until 2013-14, although total cost remains the same. Our assessment is based on
information set out in the application, as of May 2008, and we do not believe this change makes a material
difference to our assessment.
1.2.6 Further incremental enhancements to local provision on bbc.co.uk are planned in
2008/09 and in subsequent years. The ongoing modernisation of local provision is
taking place within the existing service, subject to cost, and does not form part of this
PVT assessment. It includes:
• Further opportunities for user participation on BBC local sites, developing the
range and quality of existing options.
• Development of the BBC local sites in Northern Ireland
• Improved search, navigation and site architecture, including a greater use of map-
1.2.7 Table 1.1 summarises proposed changes and indicates which are covered by the local
video PVT and which fall under planned incremental investment.
Table 1.1: items covered by local video PVT
PLANNED CHANGES COVERED IN PVT?
Local video news bespoke for broadband P
User generated video content produced with BBC assistance P
User generated video content produced without BBC assistance O
Interactive map-based navigation O
Improved linking O
General improvements to existing BBC local websites, including O
those in Scotland
Two new BBC local websites in Northern Ireland which does not O
currently have BBC local websites7
New BBC local websites in Cheshire, Buckinghamshire and Surrey P
1.3 Summary of Findings
1.3.1 There are six public purposes, illustrated below, and every BBC service should further
them in some way. Those highlighted here have particular relevance for local video.
Figure 1.1: BBC public purposes, as laid down in the Charter8
bbc.co.uk is one of the UK’s leading online destinations, with an average of 16.6 million users a month, out of
a total UK internet population of 33 million. It has an annual operating budget of £114 million and offers news
coverage at an international, national, regional and local level.
While there are no BBC Local websites, a localised news index does exist in Northern Ireland.
Each public purpose has a purpose remit, these identify priorities set by the Trust to help the BBC focus on
its remit and deliver the purposes.
1.3.2 Audiences attach a high value to national and regional news and see it as an important
part of the BBC’s remit.9 But in a fast-changing media environment, the effective
fulfilment of the purposes is under strain, as evidenced by research conducted by the
Trust into the purpose remits in 2007:10
Sustaining Citizenship and Civil Society
Regarded by licence fee payers as one of the most important purposes, BBC
performance is considered to be strong. 11 Those within the devolved nations of
the UK consider that it could do more to help them understand constitutional
affairs. Audiences also have concerns about the way devolution is reflected in
network news coverage.
Representing the UK, its Nations, Regions and Communities
In meeting its obligations, the BBC should provide a range of output 12 to meet
the needs of different audience groups. Whilst not considered a key priority by
licence fee payers, it remains an important part of the BBC remit with
considerable performance gaps.13 The perception of under-performance is
common to all age and socio-economic groups but this masks regional and
demographic differences. Groups in Northern Ireland and Scotland are among
those with the lowest approval rating. Age and social grade are also factors;
those aged under-45 in lower income groups tend to rate the BBC poorly. 14
1.3.3 The Executive maintains that two fundamental shifts are shaping attitudes and
contributing to the purpose gap:
• an increased interest in local; and
• the long-term shift from linear to on-demand news consumption.
1.3.4 We challenged the Executive to fill the purpose gap and we value the effort that they
have put into local video proposals.
1.3.5 We recognise the important role that the BBC plays in reflecting the diversity of the
UK, it nations, regions and communities.15 The key question for this PVA is not,
Ofcom’s Second Public Service Broadcasting Review – Phase 1: The Digital Opportunity, p. 36 (the top public
priority for programme types on the main TV channels was news)
BBC Trust Purpose Remit research, 2007
Spanning news, entertainment and factual content
It is among the largest for any of the BBC’s public purposes. The provision of a range of output to meet the
needs of the nations, regions and communities was also identified as an area for improvement, BBC Trust
purpose remit research, 2007
Looking at the overall UK picture, for
1)The BBC helps me feel more involved in my community
2)The BBC caters for my area and my community
The biggest purpose gaps are for under-45 C2DE groups. In ‘Delivering Creative Future’, the Executive also
emphasised the importance of better purpose delivery to C2DE audiences and of lower perceptions, among
this group, of BBC value more generally.
Our own audience research undertaken by Rosenblatt has highlighted the importance of the BBC reflecting
local issues as well as a key BBC Public Purpose being the representation of UK, its nations, regions and
therefore, whether the aims are important, but rather, whether this proposal will enable
the BBC to address local issues and close the purpose gap.
1.3.6 The gap should be addressed in a way that seeks to increase approval in the devolved
nations and English regions. The BBC exists to serve all audience groups and there is a
need to improve performance on a geographic basis. Any offering must therefore take
account of the challenges in reaching low approvers and the underserved. The Executive
hopes that local video will widen the age profile of BBC regional and local news by
attracting a younger audience. Those under the age of 45 are therefore a key group.16
However, as part of our assessment, we have also considered how far the proposal will
address audiences identified in the purpose gap research. In this PVA, we have focused
on the underserved as being, in particular, those in the devolved nations, in some English
regions17 and those aged under 45 in lower income groups.
1.3.7 Underpinning the PVA is a series of key questions:
• at what geographic level should local coverage be set?
• will people use and watch the local service?
• does the proposal narrow the purpose gap?
1.3.8 The Executive’s approach is to maintain and strengthen the reach and impact of local
news services to offset the predicted decline in regional television viewing through (a)
the conversion of existing BBC local website users to broadband video and (b) attracting
a new and younger audience to local issues. It hopes that local video will ‘reinvent the
BBC’s regional and local news offering’ and safeguard the delivery of the purposes;
compensating for the decline in the reach of regional television audiences, attracting a
younger demographic18 and deepening users’ appreciation of BBC local websites’. 19
1.3.9 We can see that there is potential for proposals to fit with and further the BBC's public
purposes and wider strategy, a possible remedy to the twin challenge of reach and
relevance. As a local news-based offering, it may reach a broader area of the UK and
better represent regions poorly served by the BBC. In practice, however, the Trust's
assessment revealed a number of issues, which we summarise below.
I. Reach and impact
1.3.10 Demand for local news is strong.20 The concept of a local video, on-demand service has
attracted support from a broad church. In theory, local news drawn together in an
innovative, interactive portal is a powerful proposition. Relevant local news has valuable
social currency and may allow the BBC to reconnect with underserved groups who
currently regard it as too remote. But if the principle appeals it leads quickly to a debate
In the Executive’s application, the offer is targeted at serving all audiences but is likely to be used above all by
Away from the South East
The Executive maintains that the centre of gravity of audiences for local video is likely to be the 25-44 age
BBC Local Video Management PVA, 2008, p. 3
As seen in evidence presented by the Executive and in our own research.
on whether broadband is an effective delivery platform and the level at which local
provision should be set.
1.3.11 ‘Local’ is a flexible concept for listeners and viewers, ranging from very local to
regional.21 Audiences expect better national and regional representation, and those in
underserved areas express frustration with poor coverage. But even those who
welcome a more local presence have differing expectations as to its character.
1.3.12 The proposal is beset by a number of issues; chief among them having to actively search
for content that many assume will be of limited interest. Audiences are interested in a
wide range of information of which news is only a part; local events, entertainment and
listings are all considered part of a well-rounded service with appeal to a broad
spectrum of users.22
1.3.13 Convenience of access is a critical factor and broadband represents a barrier to use,
both in terms of access and the way in which people consume local news.23 Whilst
usage of the internet as a source of local news is growing – albeit from a small base –
consumption is largely driven by convenience; print media, radio and television all play a
central role. This is most pronounced among the over-34s and those with children, who
typically have less time to search actively for content. For the under-35s, the internet is
used somewhat more routinely.24
1.3.14 A number of stakeholders raised concerns that a broadband-only service would exclude
certain groups; others noted that in rural areas, high-speed broadband was less widely
available. Socio-economic factors influence broadband take-up, and low income groups
are generally less well represented online. Low approval of BBC performance is more
pronounced among these groups. We are not therefore persuaded that local video will
reach these groups in sufficient numbers to close the purpose gap.
1.3.15 Research findings consistently support demand for local news delivered via television;
but spectrum scarcity and cost 25 limit the BBC to broadband. We note that commercial
news providers are embracing video news, but also that they have more latitude with
editorial agendas and a remit that encompasses listings and directories – of more
practical value and wider appeal in an online environment.
1.3.16 The Executive assumes that reach for local sites will remain steady at 16% of broadband
households and we accept this view. Even without the introduction of local video,
therefore, the number of households accessing BBC local online content will grow from
around 2.1 million in 2007 to 3 million by 2014. 26
1.3.17 Our own projections suggest local video will deliver incremental reach for BBC local
sites of between 3.6% and 9.6% of broadband households by 2014. Taking the mid-point
of 6.6% (which is in our view most likely), this represents 1.2 million UK households that
will be brought to BBC online content by 2014.
Rosenblatt research for the BBC Trust, 2008
Rosenblatt research for the BBC Trust, 2008
Rosenblatt research for the BBC Trust, 2008
Research for the BBC Trust, 2008 and Ofcom Communications Report 2008
On the DTT platform
Based on 28.3 million UK households by the end of 2013.
1.3.18 We believe, however, for reasons we set out in section 6, that consumption of local
video will mostly be among core audience groups,27 without any significant extension of
reach to the underserved and low approvers.
1.3.19 Our overall conclusion, therefore, is one of limited impact given exclusion issues for
non-broadband users and the low appeal of an online local news offering that does not
extend to listings, reviews and general entertainment.
II. Quality and distinctiveness
1.3.20 The distinctiveness of the proposals is low, although some elements are distinctive.
Given our reservations on impact and reach, quality has been treated as partially less
relevant (although indications are that it would be a high-quality service). We summarise
our analysis in figure 1.2, a full assessment is set out in annex III.
Figure 1.2: summary of distinctiveness analysis
Criterion BBC Trust Assessment
Made for UK Not relevant
Link to TV & radio brands
Crea v & e tor i a a b i on
e di l m
Fresh & original approach
Key: dis n ve no
c , t d nc ve
1.3.21 An important part of the local video proposals is a focus on partnerships. We welcome
efforts to improve collaboration and recognise it as a potential source of distinctiveness
that underpins a wider BBC agenda but note that it appears currently to be of limited
III. Cost and value for money
1.3.22 Against this background the Trust looked closely at value for money, including the wider
affordability of the proposals at a time when pan-BBC costs are under pressure. In our
view local video does not provide value for money, especially given the limited uplift in
reach to key audience groups and access issues for non-broadband users. The same, or
similar ends, could well be achieved by better use of existing resources
This point is also made by the Executive in its application, which states that ‘consumption of local video will
be predominantly among households forecast to be already using BBC’s local online content adding
considerable value for these users and “future-proofing” these websites’.
A full discussion can be found in annex III.
1.3.23 Our overall conclusion is that the proposal offers a low to medium level of public value.
In particular, its ability to further the public purposes and close the purpose gap is
hampered by limited reach to key audience groups. Our research has not established
that audiences need more video content. Our assessment instead suggests that a similar
level of public value could well be delivered with improvements to navigation, access to
a richer source of archive material and additional provision in underserved geographic
areas. Our overall findings are summarised as at figure 1.3, below.
Figure 1.3: summary of Trust assessment
2. Approach to Assessment
2.1.1 The Trust received the Executive's proposals for local video on 19 May 2008 and
launched the PVT on 24 June 2008. The first consultation period was originally set for
28 days. However, the Trust and Ofcom agreed to extend the consultation period on
the PVA and MIA respectively, to 42 days. The consultation consequently closed on 4
August 2008. This document is the PVA in the Trust's PVT of the Executive's proposal
to launch a local video offering.
2.1.2 In this section we explain the PVT process and the approach taken in this assessment.
This document is the PVA.
2.2 The PVT Process
2.2.1 The PVT is a key component of the BBC’s system of governance, which took effect
with the new Charter and Agreement on 1 January 2007.
2.2.2 The Charter makes clear that the BBC should be able to alter its UK public services,
for example to respond to changes in technology, culture, market conditions and
public expectations. However, any significant service-related proposals from the
Executive must be subject to full and proper scrutiny. The means by which this takes
place is the PVT.
2.2.3 The Executive's proposals for local video involve an expanded local news gathering
operation, which the Trust considers to be a significant change to the UK Public
Services and has, accordingly, subjected it to a PVT. The proposals do not constitute a
new service in that, if approved, they will form part of bbc.co.uk.
2.2.4 The PVT is a rigorous, evidence-based process, usually lasting six months and featuring
two consultation periods.29 Given the complexity of proposals, and in particular of the
MIA, the Trust agreed that the PVT for the local video proposal will run for
approximately eight months.
2.2.5 The PVT process is used to assess both the public value and market impact of
proposals. It comprises:
• the PVA, which assesses the public value expected to be created by the
offering as assessed by the Trust (see section 5)
• the MIA which assesses the effect of the proposal on other services in the
market as assessed by Ofcom. The MIA is carried out in accordance with the
methodology agreed between Ofcom and the Trust, through the Joint
Steering Group (the JSG). The MIA report will be available on Ofcom's
The Trust can allow for a longer period if justified by circumstances.
2.2.6 The Trust will consider this PVA alongside the MIA. In reaching its decision, the Trust
must be satisfied that any likely adverse impact on the market is justified by the public
value generated. Further, it must also be satisfied that the approval is consistent with
the Trust’s duties including those under Articles 22 and 23 of the Charter and its other
legal duties. The Trust will publish its provisional conclusions on its website
(bbc.co.uk/bbctrust) and will consult on them before making its final conclusion.
Figure 2.1: the PVT process
2.2.7 The Trust is conducting this PVT in accordance with the Guidance on the conduct of the
Public Value Test30 published on the Trust's website.
2.3 Approach to the Public Value Assessment
2.3.1 The PVA aims to establish the likely public value of a proposed new service or offering.
As a general approach, public value is primarily assessed over a five-year period; it is
invidious to forecast beyond that time given the increasing uncertainty, in scale and
scope, of factors that could potentially affect the public value of any proposed service.
However, in order to recognise the full value of a proposed service, factors beyond
this period may be taken into account.
2.3.2 As a starting point for its assessment, the Trust considers the strategic objectives
underpinning proposals. Local video aims to enrich linear provision of local issues,
develop a new tier of local newsgathering and engage a younger audience.
2.3.3 It then considers whether the proposals fit with the BBC's public purposes. It is a
prerequisite of any approval that a proposed service or offering should further the
public purposes in some way. There are six public purposes which we set out below.
Those highlighted have particular relevance for local video.
Figure 2.2: BBC public purposes
2.3.4 In its application the Executive has acknowledged that the proposals make a lesser
contribution to the non-highlighted public purposes and they are therefore not critical
to the Trust's assessment in this PVA.
2.3.5 We also assess the local video proposals against four key drivers of public value:
• Value for money
2.3.6 The following table sets out the assessment of the proposal against the drivers of
Table 2.1: fit with drivers of public value
Drivers of Public Value Proposal’s fit with Drivers of Public Value
Reach How far will the proposal extend BBC reach and usage,
particularly among underserved audiences?
Quality & Distinctiveness Is the proposal of high quality and distinctive?
Impact Will the proposal create consumer and citizen benefits,
for individuals and for society as a whole?
Cost and Value for Money How much will the proposal cost? Does it represent
value for money and is it an appropriate use of licence
2.3.7 The relative importance of each driver of public value varies across different proposals.
Our overall assessment in each case is weighted by the significance of each driver for
the proposal under assessment.
2.3.8 The following table summarises the weight attached to the four drivers of public value
for the local video PVA.
Table 2.2: weighting the drivers of public value
Drivers of Public Value Local Video Weighting
Reach To have a real impact, it must reach its target audience,
reach therefore is also a key driver
Quality & Distinctiveness This driver is important, also in relation to commercial
Impact Impact on different target audiences and in particular
younger audiences is a key driver
Cost and Value for Money Total cost and value for money relative to other BBC
investment is highly relevant particularly in relation to
commercial provision and at a time of increased
2.4 Methodology for the Assessment
2.4.1 On receipt of the Executive's application, the Trust and Ofcom jointly drafted a service
description, which was agreed with the Executive prior to publication. This clarified
our understanding of the proposal under assessment. The service description was
published at the start of the PVT process. We draw upon it throughout this report.
2.4.2 On commencement of the assessment, we undertook a series of meetings with the
Executive to understand better evidence submitted in support of the local video
2.4.3 We then considered the strategic context within which local video would operate and
the extent to which it would support the BBC's public purposes. This assessment was
informed by our analysis of the likely reach, quality, impact and value for money of the
proposed service, set out in section 6 of this document.
2.4.4 Our central assessment is in respect of the proposed launch of local video. We have
also considered the counterfactual: what would happen if proposals are not approved
and BBC local sites evolve over a five-year period with incremental investment, under
the terms of the bbc.co.uk service licence. The counterfactual is presented in section 7.
2.4.5 Our conclusions and recommendations on the PVA are presented in section 8.
2.5 Sources of Evidence
2.5.1 As part of our assessment of public value we drew on evidence from a variety of
• From the Executive – in January 2008, the Executive submitted to the Trust a
service proposal and terms of reference for its proposed evidence in support of
local video. Following approval of the terms of reference, the Executive gathered
evidence, which it formally submitted with its application in May 2008. Briefly, this
o evidence on the public value created by the proposition
o an initial market impact assessment
o findings from a series of deliberative workshops
• From the general public and industry – we sought representations on public value
from the general public and industry stakeholders. The Trust received 24
responses from industry and organisation stakeholders and 131 responses from
members of the public. These responses have been used to inform the PVA. A
high-level summary of all consultation responses from the general public is included
in annex IV, a list of stakeholders and the full text of the non-confidential
stakeholder consultation responses is included in annex V. In addition to
considering written responses, we conducted a series of meetings with
stakeholders to gain further insight into their views on the proposals.
• From our own analysis – following a preliminary assessment of the evidence
submitted by the Executive, we examined the evidence base and historical and
strategic context; tested underlying assumptions and assertions and requested
further evidence as appropriate.
• From additional research commissioned by the Trust Unit – we commissioned
Rosenblatt to undertake consumer research with approximately 130 people
through 16 focus groups and 10 in-depth triad interviews in a range of locations
(Slough, Exeter, Manchester & Bury, Cardiff & Bridgend, Glasgow, Highlands –
Inveraray, Islands – Mull, Belfast & Holywood).
2.6 Sharing Information with Ofcom
2.6.1 Throughout the process, the Trust and Ofcom discussed the proposals under
assessment, whilst always being aware of the different roles each was performing and
maintaining independence and confidentiality.
2.6.2 Information was shared except where submitted in confidence or where otherwise
commercially sensitive, in order to ensure that the PVA and MIA were conducted on
the same factual basis.
2.6.3 It should be noted that the Framework Agreement specifically established the joint
Trust/Ofcom group (the Joint Steering Group) to ensure that the MIA is conducted in
a manner appropriate to the PVT and to a suitable schedule.
2.6.4 The Trust’s conclusion on this PVA has been developed independently, without the
input of Ofcom.
3. BBC’s Proposals and Strategy for Local News
3.1 The Executive plans to build on its portfolio of international, national and local journalism,
extending reach across a range of platforms and media, see table 3.1. At the same time, it
is committed to a programme of efficiency savings over the five years to 2012/13.
Table 3.1: BBC news provision, by platform
Content/Platform TV Radio Online Mobile Red button
National news audio- P O P P* P
National news audio P P P P P
National news text O O P P P
Regional news audio- P O P P P**
Regional news audio P P P P O
Regional news text O O P P P
Local news audio O P P P O
Local news audio- O O O O O
visual bespoke for
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