TV Funding

TV Funding

Licence Fee

The main way that the BBC gets its funding is from the licence fee however Commercial broadcasters, i.e. mainly the BBC are the only broadcasters that receive any of this funding. The licence fee is £145.50 per year which is the equivalent of £12.13 per month The BBC used its income from the licence fee to pay for its TV, Radio and online services. About £7.96 per household goes on T.V meaning roughly £2.351 million overall, £2.11 per household goes on radio roughly £604 million overall. Finally online receives around £0.66 per household meaning £199 million altogether. The remaining £1.40 per household, roughly £406 million is spent on things such as investment in new technology, running costs and the collection of the licence fee.  

Syndication

Another way of TV funding that, this time all the channels use, is Syndication. Syndication is the process of when a TV channel for example BBC make a successful program that other broadcasters then want to show in their countries the TV network will then sell the rights to show episodes to the other countries. An example of this would be how BBC created top gear and now it is shown in around 37 countries.

Advertising

Advertising is an extremely important way for almost all broadcasters to make money; the only broadcasters that don’t advertise are commercial broadcasters who get the substitute money from the licence fee instead.  Advertising can consist of lots of things from 5 minute ad breaks to programs being sponsored. The way that the Broadcaster generates funding from this works like this: When a channel is watched more the price that a product or company will pay to advertise will be. If there is a certain program that is watched the most for example coronation street then the price for advertising at that particular time slot would be more expensive that at 5 in the morning.

Competitions

On most popular programs, usually game shows, Television broadcasters often give the audience at home a chance to join in. They ask an extremely simple question for people to then ring in at the usual price of around £1 per phone call, the Broadcaster usually makes the question so easy so that as many people as they can get ring in. An example of this is on ‘the X factor’ when they ask questions such as what country has the capital Paris? The Broadcaster would make a lot of money even after giving out the prize because so many people phone in because they know the answer.

Subscriptions

Subscriptions are a very easy way for the broadcaster to make money, the best example of this is Sky with channels like sky sports and Disney. This is when the Broadcaster makes the viewer pay an annual fee to watch their channels.  With sky the customer pays one fixed fee for the box itself and then a certain price every month/year. The price depends on the ammount of channels that the customer has chosen.

Merchandising

If a TV broadcaster, Commercial or public, creates a hit program they can then use the programs popularity to make more money in merchandising, for example the most obvious products  would be a dvd set or a T shirt. However the things sold can be anything such as posters, lunch boxes etc... One particular example of this is the inbetweeners who have lots of merchandise including T-shirts, posters, car stickers to car designs.