Ginormo-indies, Netflix Loses WBD, BBC Fights Back

0:01Matt Deegan: Hello, welcome to the Media Club. I'm your host, Matt Deegan. In the club today, all three media and BannerJ have merged to create an$8 billion super mega indie. Media writer Tara Conlan takes stock also on the show. It's the biggest media merge in history with a debt pile to match as Paramount Skydance beats Netflix in the bid for Warner Brothers Discovery. Omar Oakes is here to crunch the numbers. All that plus News Corp reveal its two word strategy for dealing with AI. The BBC publishes its charter wishlist and in the Audio Network Media Quiz, we discover that not everything is what it seems.

0:37Matt Deegan: That's all coming up in the Media Club. Come on in.

0:46Matt Deegan: Hello both. Hello. Nice to have you on the sofa. Joining me, a media writer whose credits span The Guardian, Broadcast Magazine and many more, is Tara Conlon.

0:56Tara Conlan: Hello.

0:56Matt Deegan: So, long-term member of the Media Club, but who would you like to have as your plus one this week?

1:03Tara Conlan: I would like to bring along Patricia Hidalgo, who is head of BBC Children's, director of BBC Children's and Education, because I've been watching for a while what's happening in children's TV, and she was talking to the Culture, Media and Sport Select Committee this week and warning about the issues in children's TV, that it's declined by, I think it's around 40 % over the last 14 years. The number of hours, I think the amount being spent is under$80 million or something. And she said, essentially, public service broadcasters, we are not doing enough to give her credit. She is commissioning things.

1:45Tara Conlan: There's a great show on CBeebies, which was, I think, a fully funded commission, Rafi the Wishing Wizard.

1:51Matt Deegan: Which is unusual now to have something fully funded.

1:52Tara Conlan: Exactly, yeah. And based in Manchester, great animation, sort of aimed at families. Brilliant. But how much is everyone else doing? And I think she had a figure of something like the streamers made about 12 hours of UK originated children's shows last year, maybe it was. and various companies like Blue Zoo Animation as well have been great at kind of like sounding the warning of how can we help ensure that there is more children's TV. You know, if we're going to be not allowing children under 16 to have social media, we need to make sure that there is some really good content out there being made and British content for, you know, for them.

2:32Tara Conlan: So nothing wrong. There are some great, you know, global children's shows, but, you know, obviously Bluey is huge. But where's the volume?

2:39Matt Deegan: yeah it's interesting I was listening to a podcast and Hank Green who's made lots of content over the years on YouTube and he makes now quite a lot of educational content one of his companies does and he was sort of saying content for eight to twelve year olds kind of globally very hard to fund very hard to find kind of any money for and sort of preschool a bit confined to cash a bit more you know they're things that turn into lunch boxes and merch but actually eight to twelves and even to teens, there isn't a lot that's being made at all.

3:10Tara Conlan: No, it's really difficult. Tom Cousins, who did Raffi the Wishing Wizard, he was, you know, been involved in animation and children's for a while. But he was, you know, just looking at what was working, you know, making sure it's something for the family, looking at those sort of universal themes. You can make money. I mean, as you say, you know, look at the merch opportunities from Bluey, Bluey the film. So when it works, it really works, but there's got to be more bets being taken, And whether or not that's helped with tax credits, there's been quite a lot of talk about that or some other kind of lever that the government can use in order for more children's shows to be made.

3:46Matt Deegan: Yes, no, definitely need some attention. Also joining us, a writer and former editor of The Media Leader, now a consultant for the advertising sector, Omar Oaks. Hello.

3:54Omar Oakes: Hi, Matt.

3:55Matt Deegan: Who's on your plus one list this week?

3:58Omar Oakes: So I would like to invite into the club a young man called Mustafa Zadeh. And he's a Tehran-based journalist who was featured by Wired in the Middle East this week because there is a war happening in Iran, as everyone knows. And it's a reminder of how important journalism is if we needed reminding again. You know, I came into this industry as a very privileged Western person who wanted to do something interesting and cool. And you think about how the stakes are in that country when they're dealing with oppression to a scale that communication has been almost reduced to nothing. He can't use Starlink even because the government can track it.

4:36Omar Oakes: And because of espionage laws passed just at the end of last year, you can face death for this sort of thing. So this is real. And they've managed to get stories out by encrypted by using old fashioned SMS, by encrypted video. And it's just extraordinary what they've been able to do. So he deserves a lot of credit. and it also raises a wider point about trust as well. I mean, some of the stuff that, you know, it's been frankly disturbing. Every day from the White House we see, we hear something different about the rationale for the war. And when official sources seem to be giving you an inconsistent picture, then we rely on journalism as, you know, to use the cliche, the first draft of history.

5:12Omar Oakes: It's not just about getting information, it's about quality information. It's so important. So please welcome him in.

5:18Matt Deegan: Yes, he can definitely join. I think it's been interesting, the Pentagon, very few press conferences, they sort of got rid of all the regular media and kind of brought in their friends. But even now, very few sessions, even for them. The changing story is interesting. If you take away the sort of Trumpiness of it, just the professionalism of generally when there's war activity, you see a very streamlined comms process come from the US government. and that just doesn't exist. There's no consistency. And even if they do think it's right, and I think you can, you look at Iran, there's a lot of people in Iran that are very happy that there's been intervention, but it's not being communicated well.

6:03Matt Deegan: I think I saw today that CNN have got someone into Iran for the first time. And we saw it in Israel as well. There weren't journalists in Palestine to be able to report on what was really happening.

6:14Omar Oakes: It's incredibly important and should raise the question again about foreign bureau and how well they're funded i mean beyond the bbc and itn you know we need

6:23Matt Deegan: more of these people uh also i don't know if you've seen it in your feeds but um obviously ai created videos about strikes uh in in in different places in the middle east there's loads of them like the first comment is normally is this ai uh i was i was watching a uh what looked like an american aircraft carrier be be struck uh and when you looked in the comments someone said no this is from this video game. And it's hard to tell.

6:51Tara Conlan: Yeah.

6:51Omar Oakes: Yeah. And it's increasingly, I don't know about you, Tara, it's increasingly something that I find myself writing about AI, not only because it's incredibly interesting, the impact that it's having on media and advertising, but also I come back to the issue about trust. If you're a publisher nowadays, you've got to be having serious questions about what your policy is with disclosing your use of AI and how you're going to talk about this in the public realm. Because we are getting to the point where everything goes on YouTube and consumers are saying, is this real? Can I trust it? In the short term, you would expect people to flock to quality media, but in the long run, it's got to have a damaging damage effect on our industry.

7:27Matt Deegan: Or just sort of blanket lack of trust kind of flows over into regular media as well, doesn't it?

7:35Tara Conlan: Yeah, and actually I was at the RTS News Awards last night, which I'll come on to later, but Mark Austin went up on the stage to collect the award for Sky News for Channel of the Year. It was just him, actually. Usually Sky flood the stage, but it was just him this year. But he said, you know, content is still king and still what is important is the importance of bearing witness, you know, being on the ground, actually reporting from the voices that you trust who have those networks. But again, you know, what can be created by AI, that is difficult now for some people to ascertain. There is something which most people, you know, I saw a teaser tape the other day for a show at Showcase, London Showcase last week, and we were like, yeah, you can tell from the eyes that it's AI, you know, when you look at the people.

8:27Tara Conlan: But, you know.

8:28Matt Deegan: I know the number of people who have come up to me to talk about Jim Carrey. Yes. And how, you know, has he really been cloned? And you think, I thought you were better than this. So if you haven't seen it, worth checking out. Maybe whilst we take a break. I'll see you in a sec. When we'll be talking about Super Indies, because we've had Indies, we've had Super Indies. What do we now call the merger of all three media and Banerjee? We'll see you in a sec.

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10:18Matt Deegan: Welcome back to the Media Club. In a huge deal announced on Tuesday, all three media and Banerjee emerging to create what they're calling the world's largest independent production company at a combined value of around$8 billion. Tara, what does this deal mean? What's under the roof?

10:37Tara Conlan: Oh, it's pretty much everything, isn't it, really? You've got MasterChef, you've got Traders, you name it. It's almost under there. I mean, it's huge. Was it over 140 labels or something?

10:47Matt Deegan: 170 labels.

10:49Tara Conlan: 170 labels.

10:49Matt Deegan: 260 ,000 hours of content.

10:51Tara Conlan: Yeah,$8 billion. Worth$8 billion. But they want to take$50 million of costs, I think, out, don't they? Yes. So there was, you know, there's been a lot of talk at various things I've been at this week, you know, about since it happened, which just feels like about a week ago because it's been such a busy week. But, you know, what does that mean in terms of, you know, jobs going, you know, obviously there's back office, there's economies of scale, all of that.

11:16Matt Deegan: Are you expecting to anybody at those companies how they feel?

11:20Tara Conlan: Yes, I have. Six months of waiting, basically, you know, as to what happens. it depends which side of the deal you talk to you know obviously the baner j crew are happier than

11:32Matt Deegan: the all three the bigger company it's going to become baner j yeah yeah so all three media gets

11:38Tara Conlan: sort of subsumed yeah and i think i mean there's talk of you know does the all three name go which is you know it was a great british brand set up over 20 years ago um so you know that's obviously sad in its way. But then, you know, what do you call this conglomerate? And actually, my old boss, Janine Gibson on the FT, she came up with the phrase, Enormo Indie. So then if, you know, there's stories about Banerjee buying ITV Studios, so then what do we get to? Like a gargantuan indie, a global indie, a glindy? I've no idea. I mean, you know, effectively, they are, they're a direct-to-consumer broadcaster through their various YouTube content as well.

12:22So we need a new name for it.

12:25Matt Deegan: Do they, essentially, at that sort of scale, and so you said some of the shows, Traitors, Peaky Blinders, MasterChef, Big Brother, Survivor, Gogglebox, Squid Game, Race Across the World, the Challenge, Race Across the World, The Beatles, Biopic. I mean, it's huge. Do they even need a broadcaster anymore? Have they transcended broadcasting?

12:43Tara Conlan: Well, I think I saw a headline briefly about, was it Marco Bissetti sort of saying, you know, this redresses the sort of balance of power against the broadcasters i think it was in mosella um and i guess it it it does i mean they they are doing everything from everything apart from broadcasting i don't think they're doing live shows they're doing the actual making of the shows they're developing things on youtube so they're pretty much doing everything except

13:07Matt Deegan: putting it out the pipes um and i guess kind of the way that tv works now um there's not really a lot of back ends you sort of get paid up front from from the streamers but i guess your opportunity is merch and events and other stuff all that ip that catalog that you have which you know

13:26Tara Conlan: particularly in comedy which will just go on forever and ever and ever i mean the newer you know the streamers are getting obviously into that and buying out more rights and so there's not you know there isn't that same um level that that that they used to be able to get that level of revenue but yeah i mean in terms of rights it's a rights you know mega market owner now isn't it it really is it's got it's got a lot almost uh jeff zucker the former cnn boss uh who led the

13:55Matt Deegan: redbird rmi acquisition of all three media in 2024 uh now becomes kind of chairman of the combined entity uh and redbird are going to own basically it with um uh i'm going to own it with vanagy quite a journey for Jeff over the last few years. Omar what do you make of his role in all this?

14:15Omar Oakes: It was incredible wasn't it? Wasn't it less than two years ago he bought all three for something like just over a billion and now it's like the foundation element of this mega normal indie as Tara calls it it's absolutely incredible and it just shows what you can do if you actually leverage the platform side of it as opposed to just a media play. Very interesting And as you say, if they can leverage all that IP in new and creative ways, not be tempted down the direct-to-consumer route of streaming, it could be very interesting indeed.

14:49Matt Deegan: As Tara said, they've got to save some money. They've said they're going to save 50 million euros in synergies. Is there much to save in this kind of organization? Does the money mainly come on screen? I think there is a lot of cash to save at the back office.

15:04Omar Oakes: Well, I don't know. I mean, they will say so. They will say, particularly on the sales side, on the commercial side, that there's always duplications that they can minimize. But you would have to think that it's going to mean some tough creative decisions and some consolidation, which isn't good for the market. And how many buyers are there as well? They keep consolidating. They keep talking about leverage and scale. But what about the other side of the market?

15:31Matt Deegan: Tara, what is to my TV studios? might be divorced off in the in the sky takeover is that going to end up do you think in the super

15:40Tara Conlan: mega enormous corp i mean it could do couldn't it i mean who'd have thought we'd be at this situation but you know they had they haven't said no and in fact i was looking around the rts uh news um journalism awards last night and looking at the various tables and you know you had your cnn table your five table your there were people there from itv i mean it was you know a star-studded event. And I was thinking, well, how many of these, you know, different tables are going to be, which people are going to be here in a couple of years' time?

16:11Matt Deegan: Well, speaking of combinations, Hotline Hills has one record-breaking merger. Here comes the biggest one ever, because we learned on Monday that Paramount's Sky Dance had beaten Netflix to acquire Warner Brothers' Discovery in a deal worth more than$110 billion. Omar, I think everyone thought Netflix were going to get it.

16:30Omar Oakes: well yeah because we were living in a world where we all thought that paramount's offer even though it was higher was just so laden with debt that it would be ridiculous but apparently we were all wrong yes and it just shows that despite all the fundamentals despite all the concerns about debt i think the thing that really matters is being close to donald trump also the i thought it was

16:52Matt Deegan: interesting netflix had clearly perhaps pre-decided how high they'd go and that they sort of already reached that point so they answered very quickly when when paramount raised their offer it was only a dollar it wasn't a huge amount of money i could have easily been matched by netflix but they they

17:07Omar Oakes: chose to to walk away yes and if you if you're netflix think about it this way you're now sitting on two billion that you were accounting for not having so this is the break fee so so they've

17:19Matt Deegan: because the the deal hasn't been done and they had a sort of a good deal with warner brothers in place and they've got to pay i think 2.8 billion uh dollars to netflix yeah it's not a bad

17:30Omar Oakes: consolation prize is it yeah and this and and going back to the fundamentals of the business they are still growing organically um the ad tier that they launched um not so long ago let's not forget is actually doing probably better than a lot of people including me um expected um so netflix fundamentally is still doing quite well and why why is this deal too attractive to netflix in the first place. I mean, if you look at, if you go to Los Angeles, I don't know how often you guys go to Los Angeles, but from what I hear there, it's kind of like Detroit used to be, is in terms of like all these people that used to work in the entertainment industry over there.

18:04Omar Oakes: It's just kind of been eroded away since the pandemic. And that's due to Netflix and different commissioning model that they have. That is a sign of how much they've disrupted this industry. And Paramount and Warner Brothers huddling up for warmth, we'll see in the long run how strong the business is.

18:26Matt Deegan: So the debt is extraordinary. So Paramount have lined up$57.5 billion in new debt financing for this deal. And Warner Brothers already has a lot of debt that it's going to flog off to them. Tara, have they got the ability to pay this down and build a business? I mean, they've got to really cut, they've got to cut a lot of things.

18:47Tara Conlan: Yeah, they really have. Was it like six billion they've got to save? They've said they're going to save, yeah. I mean, the bankers, the lawyers are very happy. I can't remember who it was who said, you know, like the Fox deal as well. You know, that's still being, you know, paid off. It is a lot. And, you know, ultimately, how much can they save? How much can they really save? Can they save that much? will it create new and better programs who knows you know it's it's i mean they've committed to

19:22Matt Deegan: i think 15 movies per studio so it's like 30 cinematic releases yeah uh seems quite a hard

19:30Tara Conlan: thing to to get out the door i mean it's one of those things you know where it's a it it's primarily a legacy business um so there will always be you know cuts that can be made but but really that many, but really do they care? Is that the ultimate reason why they're doing it? Probably not.

19:48Omar Oakes: And it's particularly on the Warner side as well, because this is the third time now since 2018 that those companies changed hands. You know how the story goes every time there's a merger, there are cuts and cuts, as we were just talking about with Banerjee and All3. Is there much more to cut of this business?

20:03Matt Deegan: Well, Warner, you could say, is the cursed media company. So you had the AOL, Time Warner disaster, AT &T, bit of a disaster, acquisition sort of merger with discovery they've done quite a good job of paying down the debt but you know it's not been a glowing report card on the business no none of these businesses have delivered what they said to the market they would deliver in savings or future profit have paramount bitten off more than they can chew i think so but when you know your dad's one of the

20:33Omar Oakes: richest people in the world and you want to go to the oscars and say that you're in the biggest you know legacy conglomerate media conglomerate in the world that's all that matters really isn't it

20:42Matt Deegan: yes my unhappy face is probably at cnn um david ellison uh who who runs paramount skydance has put in barry weiss's editor-in-chief of cbs news which was sort of quite a surprise not a lot of tv experience more kind of trump friendly uh editor and she might end up with cnn as well you'd be scared if you're at hudson yards or or in the uk working for cnn wouldn't you

21:07Tara Conlan: I mean I guess it's sort of 50-50 as to what happens you know if that does come under her auspices you know will Mark Thompson remain there will you know how much will that change the complexion of that particular business you know it's still doing great work so it's really down to what happens next in terms of the who's at the helm of it really doesn't it. I think Mark Thompson

21:34Matt Deegan: that DG job might look a bit more brighter than it did a month ago.

21:37Tara Conlan: Well, that was interesting timing, wasn't it? That leak, I thought. Or suggestion.

21:42Omar Oakes: Yeah, last time I was here, we were talking about that, weren't we? And then it became very much a rumour, didn't it? That he might come back.

21:49Matt Deegan: Yes, I think he was approached, but he doesn't need to do it and has very much moved on.

21:54Tara Conlan: He's one of the few director generals who's been able to leave on his own terms. Very rare.

21:59Matt Deegan: And finally, just before the break, News Corp CEO Robert Thompson has given us the most memorable phrase to describe how a legacy media company might handle the AI giants. Two words, woo and sue. What does that mean in practice, Omar?

22:15Omar Oakes: Well, I'll read you the quotes. So Robert Thompson described at a Morgan Stanley conference, we have what you might, I'm not going to do an impression. We have what you might call a woo and sue strategy. We'll woo you. We'd like you to be our partner. But if you're stealing our stuff, we're going to sue you. I should also know News Corp is also suing Perplexity, the other AI business, for copyright infringements and was involved via HarperCollins in the Anthropic settlement. So it's not to say they're not litigious.

22:45Matt Deegan: They've done deals with OpenAI, I think a quarter of a billion dollar deal in May 2024. And they say that they're talking to Google for Gemini and others. Sensible for a media company to do it this way?

22:58Omar Oakes: I think it's sensible for News Corp because the News Corp, they're massive. I mean, when you've got the wall street journal the sun the times harper collins it's a genuinely diversified media portfolio with massive scale um if you're a mid-tier uk publisher you know how many ai companies are going to be willing to settle with you or offer you 50 million dollars a year as facebook has um so great for them i'm not sure it's a replicable strategy you're both journalists are you now just input for llms that's why we went into it that new title

23:30Tara Conlan: yeah I'm an input of LLM yeah it's what we all dreamed of it really was I mean that's a good point someone said who was it was saying we are now curators I think you know I'm not really feeling like a curator I feel like that's a museum kind of term but yeah I mean our work our research exclusives are all being fed in and and used i mean if they can it's a fine it's a fine line isn't it you want ai you know my children use ai we want it to be reliable and accurate equally we want to be recompensed fairly for it and it's finding that balanced well some news this week about uh google

24:19Matt Deegan: and the amount of traffic that will go to websites um i mean there's some data from from reach have not done particularly well it sort of shows when you're over reliant on google traffic down 46 percent in six months there was a list of a load of publications that have seen massive declines things like the verge and big websites some that maybe are a little bit too tuned to to seo i mean if you're trying to be an ad-funded website that those days are over aren't they

24:46Omar Oakes: well um they call it zero click now where you know anyone who goes on google you're presented with an ai mode answer to your query which stops the inconvenience of actually having to go to a website and verifying this stuff for yourself i mean i would recommend um people there was to people there was a very good um interview with reach's ceo pierce north this week with press gazettes and talking about this issue with google as you say but i remember under a different ceo maybe four or five years ago they were lamenting how facebook changed their algorithm and it saw something like a 25 it was a figure like that percent drop in traffic from facebook referrals so unfortunately because of the way that open web is and because of the publisher model on the internet these publishers the big tech has a knife to their throats and what do you do well we've had

25:30Matt Deegan: people on the show before and you talk to the people at the daily mail have sort of given up on on google and it's very much building their own destination brands um can everybody do that is everybody in position to be able to achieve that well i think you know talking to people who

25:44Tara Conlan: are in the vertical video side of the publishing businesses of the legacy publishing businesses it you know socials are a great way of bringing in people to your brand to your news brand um and i think that is helping that is working uh hence you know for very many reasons why if there's a greater investment in vertical video by by them um and and and then they come direct to you you know it come to your platform they're not coming they are coming via social media via tiktok via instagram but you know at least it's your journalist out there and you know that's it's a form again of going direct to consumer isn't it um it's not cheap investing in that i mean

26:28Matt Deegan: is there a danger that that a lot of traditional publishers sort of hop platform to platform i mean vertical video probably the latest it's very hard to build your own brand and build your own destination uh are these delaying tactics for before the inevitable i wish that publishers

26:45Omar Oakes: whether you're in the video or the digital version of print space would actually be more creative about how they looked at the whole influencer space as we're calling it now um i've been saying for a long time that the bbc for example because of their scale and their cultural importance and public service remits that they should essentially not copy youtube but they should do a version of youtube where they create their own platform they they have their own bbc academy for content creators and they create a bbc version of a youtube a much smaller scale but it has its own identity it has its own purpose and the guardrails everything that people criticize youtube for for not having all the compliance issues why don't particularly the public service broadcasters why don't they become more like platforms themselves why do they keep seeding this ground well funny

27:31Matt Deegan: you should say that when we return we're talking what the bbc is suggesting uh for license fee renewal and the charter renewal and there is some discussion about what iPlayer should become. We'll see you in a sec.

27:50Matt Deegan: It's all wooing and no suing here at Podshop Studios where we record the Media Club each week. Every studio has its own distinct look and feel, all professionally designed and fully equipped for broadcast quality video recording. You can check out the whole range at podshoponline.co.uk and they're offering Media Club listeners and viewers a 25 % discount on their first booking. Just use the code MEDIACLUB when you book online at podshaponline.co.uk.

28:17Omar Oakes: Hello, Media Club listeners. Patrick here from Podcast Discovery, the podcast marketing company, where this week we've been thinking about timing. It's International Women's Day this Sunday, but you've probably been thinking about that for months if you've got a relevant podcast. Next up is Pride Month, and it's less than 100 days until the Men's World Cup. Is your show prepared? get in touch at podcastdiscovery.com. That's podcastdiscovery.com.

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30:16Matt Deegan: Welcome back. Here's some stories we've been talking about in the club this week. Reach, as we mentioned, publishers of the Mirror, the Express and dozens of regional titles, has reported a 46 % drop in Google Discover traffic in the second half of last year. Digital revenues fell 7.8 % in the final quarter. And the company's closing two of its three print plants, affecting around 240 jobs. Over in Australia, after 25 years, the Kyle and Jackie O show is over. Jackie Henderson walked out after Carl Sanderland berated her on air for having an interest in astrology and more. But this week, ARN, their parent company, terminated Jackie's$100 million share of their joint 10-year deal.

30:57Matt Deegan: Kyle has been forced to give 14 days to remedy what ARN calls serious misconduct. Oh, his$100 million goes as well. It's a story that's fascinating and is going to run a run a run. And I think the lawyers are going to make a lot of money. And finally, Lovejoy is coming back. Seesaw Films, the production company behind Slow Horses and Heartstopper, what a competitive bid to adapt the original novels for today's audience. No broadcaster or streamer is attached yet. Ian McShane who played the original has previously suggested they should cast a woman to play as character's daughter we'll see if they go down that route links to all those stories and everything we talk about is available on our sub stack go sign up it's free at themediaclub.com that's themediaclub.com Tara and Omar are still with me are you up for a Lovejoy reboot Tara?

31:51Tara Conlan: Yeah you know it's antiques roadshow you know the dramatised version without Fiona Bruce and say, well, maybe it could be Fiona Bruce. Yeah, I mean, it feeds into the nostalgia. It feeds into, you know, our love of antiques and crime.

32:04Matt Deegan: Sort of very Bergerac-esque.

32:06Tara Conlan: Yeah, yeah, exactly. Who else is left of those old detectives that could come back? They've all come back, really, haven't they? Love a reboot.

32:12Omar Oakes: I'm just excited who's going to play Tinker

32:13Matt Deegan: in one of my favourite characters of early 90s television. Well, after your excellent impression earlier, maybe that job's yours. Some kind of breaking news today, the BBC's response to the BBC Charter. This is the Green Paper that the government launched. What do they want? They want a permanent charter, not for it to be renewed all the time. No more political appointments to the board. Do you think they're good asks, Tara?

32:37Tara Conlan: Yeah, I mean, in a sense, they're not new. They've been asking for that for a while. And they pointed out that 94 % of all homes watch the BBC, but only 80 % are paying for it. so they're saying this is not sustainable long term and that's true isn't it it is true yeah and they're saying we'd even have potentially a lower licence fee if more people were happy to pay for it as always it's about how do you actually ensure that that happens and then that's about regulation you know it's obviously been a lot of stories about criminalising people who have not paid the licence fee they're saying well if the what many people don't realise is that live TV, you need a licence for whether or not that's on Netflix or the BBC, and they're saying, would it be alright, streamers, if you know YouTube, if you remind people they're supposed to pay the licence fee if they're doing this.

33:40Tara Conlan: And there's, I wrote, without blaming my own trumpet, I wrote a book, a chapter of a book last year about the future of the BBC, and I actually looked at the licence, your TV licensing blurb. And it does actually say in there, you know, for live TV, you really do, but covering all of these screens. So it is in there, but again, it's about enforcing it. And then what happens, you know, with catch-up, changing viewing habits mean that a lot of people are watching on catch-up, but that is not covered by the terms of the TV licensing at the moment. So they mentioned that again. And they also mentioned about the iPlayer.

34:26Tara Conlan: And again, this is such a long running story. I broke this story about Project Kangaroo in 2007. You know, my daughter was just born and she's now at university. That's how long this story's been going on. And at the time, as I'm sure everyone knows, Project Kangaroo was about having this streaming service, Web TV, I think it was called at the time. this streaming service that Channel 4, ITV, BBC would all be part of wasn't allowed by the competition authorities and we are where we are and the BBC is now saying and again I mentioned it in my book chapter last year and nothing has happened since not saying that anyone should have read it but over time, that was last summer the BBC has been negotiating with the other broadcasters about would you like to come put some of your stuff on our on iPlayer and we've seen ITV and

35:19Matt Deegan: Disney Plus do it so that yeah channel 4 channel 4 and UK TV content it's not yeah well way with

35:25Tara Conlan: the fairies idea but you know for the last however many months they've been trying to to make this happen but as always it's about billing it's about branding you know ITV has put a lot of money into ITVX it's also about you know the advertising issue um the BBC are exploring with S4C about potentially, you know, putting little guards around that so you have the advertising around S4C but not around the BBC content. But then it's also about the name of this. I mean, iPlayer is a great name. Last summer I spoke to Josh Reynolds, an MP, about it, and he thought it was, you know, a great decision to just keep it, you know, called iPlayer.

36:06Tara Conlan: But how did the competing media brands, who were also, some of them, like ITV, in a consolidation phase, you know, in a sort of an acquisition, subject of an acquisition phase. How do you make those kind of decisions and negotiations when you don't know if you're going to be part of some other company like Comcast?

36:26Matt Deegan: Another super megacorp.

36:27Tara Conlan: Another super megacorp. So all these things have been going on in the background for the last few months and the BBC has to grapple with all of these.

36:34Matt Deegan: I always find that as we approach license fee renewal, the BBC sort of rediscovers its own, its religion it pretends to be very nice, it's like of course come on board iPlayer, like really we should be where you all are, we're very open advertising can be on there, subscription can be on there, we're all okay they aren't one of the hardest people to work with on any deals, anything and there's worries about public value and all of those sorts of things, but But there's a bit of me that's like, why have you done any of this before? Why just when you're being threatened, does all the good stuff come out?

37:13Matt Deegan: I read the I've read their response. And there's then a line which says it's quite a bit about the iPlayer option. And it's like, oh, and we're looking to do it on sounds as well. And just like that sort of one one line kind of throwaway edition. I know there's been some discussions over the years about that. But the government were basically arguing for a smaller BBC in their in their green paper. And the BBC are kind of asking for a bigger BBC. And why isn't that sustainable in today's media world?

37:45Omar Oakes: Well, I think when you say that they're a really difficult organisation to work with, that's a reflection of them being an inherently super conservative organisation because they operate with a bunker mentality because of the political environment that they work in. Unfortunately, when the Green Paper is arguing for a smaller BBC, the instant reaction is, okay, well, we need to set our negotiated position higher. I mean, with this thing about ending the 10-year fixed charter renewal, I happen to think that it's a good thing. We should have this opportunity when the deadline comes that we actually take stock of what the BBC is actually for nowadays.

38:22Omar Oakes: And the BBC should be prepared to aggressively set out their stall because no media company, every media company must change, particularly when it's under a public service remit with a government charter. we should have a democracy that's strong enough and sophisticated enough to decide what that looks like going forward.

38:40Matt Deegan: But isn't the problem that it really isn't necessarily the BBC's job to set out what public service broadcasting in the UK is? Shouldn't the government provide a little more direction on what the government wants to pay for, what it thinks the British public want to pay for, rather than leaving it up to the BBC to decide the shape of it as an organisation going forward?

38:59Omar Oakes: I think we need to be careful with letting civil servants and elected politicians actually start dictating what media companies looks like. I think that sets you down a very dangerous road.

39:10Matt Deegan: But they're the ones that go, oh, no, you freeze the license fee, it's all too expensive. Or I think you should cut it back. What do you want a provider to provide?

39:20Omar Oakes: Well, the government needs to be braver with setting out its position on the general terms of what it wants the BBC to do. it needs to be braver in terms of proposing what that looks like in terms of a broadband tax and frankly you know i've been covering the the advertising side of this business for a long time now one of the things that's constantly surprised me as you talk to executives at a channel four an itv a sky um they don't want the bbc to be neutered they like having a strong bbc because it raises the standards of the whole industry which at the end of day allows them to charge allows them to charge more money for ads.

40:00Matt Deegan: And obviously advertising, the BBC aren't keen that there's advertising and advertising would probably destroy pretty much the rest of all commercial media.

40:08Tara Conlan: Yeah, absolutely. And I think, and again, it comes down to, you know, the BBC has incredible soft power around the world. You know, it does advertising around the world, around its commercial entities there. but having that independence that political independence but also that editorial independence which people do feel even though in an influencer you know native world that we are in we know that it you know that you've got to have an editorial integrity the BBC it's damned if it does and damned if it doesn't it has to remain independent and it can't you know be subject to the whims of the government of the day as well.

40:54Tara Conlan: I think that's the big argument that Samir Shah has been making for a while now, is that the way that the political winds blow affects the BBC. We've seen it. We've seen the effect that it has had on the top echelons of the BBC itself.

41:12Matt Deegan: I'm still going to say the same thing I always say when we talk about BBC and the licence fee renewal. It should be on your council tax, which is changes on how big your house is and broadly what you're earning is so it can be slightly progressive. No one wants to do it or touch it, but I will just keep repeating that's the way to do it. That's a good thing because the council tax

41:34Omar Oakes: hasn't changed since 1990 itself. So once you put it on there, it's never going to be removed.

41:38Matt Deegan: Right, just before the quiz, we talked about AI earlier, Omar, but you've been writing recently about WPP's take on AI. What have they been saying?

41:49Omar Oakes: Yes, so they did actually something which I thought was incredibly brave. So they actually put out this statement, this report, where they set out five pillars that will determine who owns intelligence by 2030, which, hmm, that long away. So these pillars are data assets, AI capability, distribution, transaction infrastructure, and content integration. Now, what I was most worried about from everything that they were saying, it's quite a long document, is they're essentially, they want to transform their business so that they will be able to leverage AI to help brands better leverage the buying signals that the machines we were talking about the AI's you know scanning for what the journalists are writing they're going to be scanning all the supermarket data all the vendor data to see what the buying signals are to optimize those but my question is what happened to creativity what happened to the good old-fashioned business of actually trying to persuade people to buy product A as opposed to maybe products B, C and D.

42:51Omar Oakes: The problem is when you create a system where you're just having all these AIs, you might be brilliant at reading all this data from all this stuff they're being fed. It's like if you have an ice cream van that kind of like parks outside a park and they sell chocolate and all the kids run them say, oh, chocolate, chocolate, chocolate. And there's an AI saying, oh yeah, kids like chocolate. And then someone comes along and says, oh, I think they like strawberry ice cream instead of chocolate ice cream i thought okay well what should we do let's make it should we make it brown should make it taste like chocolate because that's what kids like and i really worry that an industry that has been challenged by the by the whole business model of agencies being challenged lots of creative agencies of big companies being merged um ai is having an impact um but they as they increasingly go down the media routes of making money from advertising you suddenly wonder how much they're taking the eye off the ball of actually preserving what made them special in the first place which is leveraging human creativity but if the metrics prove that the the ais are the

43:53Matt Deegan: masters of this um isn't that the right thing to to follow if it delivers a better return for clients than a good creative cell the metrics will prove what you want them to prove i mean anyone

44:04Omar Oakes: who's played around with ai you can you can get it to you know credit you with doing a good job because as long as it all depends on the inputs and the questions and the prompting. Brands, at the end of the day, we've seen so much money go into questionable channels in terms of the ROI they produce, social media, influencer. All the effectiveness data for over a decade now has shown you that TV and brand building and cinema, by the way, and audio are still the most effective ways to advertise. but yet the money proportionally keeps going into addressable advertising on social and increasingly influencer and it's because they're highly measurable if you're a brand cmo these people are an endangered species their average tenure is something like less than 18 months for these jobs that measure advertisers they know you know it used to be uh no one ever lost money putting money on itv and now it's no one ever lost money putting money on google um so that's the world we and what is measurable is what's managed.

45:06Matt Deegan: I mean, Tara, it's bad news for broadcasters. They're not necessarily aligned with this world well enough. Historically, it's that we've generated audiences, advertising follows. That's being kind of broken, that link.

45:18Tara Conlan: Yeah, I think there's sort of two things going on because I was at a Thinkbox event earlier this week where they were basically saying, as they probably would, being the marketing body for the commercial broadcasters, telly is actually still doing really well. You know, a third, I think, of the viewing hours. YouTube has a third of the viewing hours that all total TV does. And they were saying things also like, you know, it makes economic sense to advertise around a trusted program. 23 % more likely, I think it was, to recall an ad campaign if it's around a piece of TV that is quite jolly, quite happy, and you're watching it with other people.

46:07Tara Conlan: It is making economic sense for brands to still advertise on telly. There's still a great return. But then on the other side, you know, broadcasters, again I was at the RTS Journalism Awards last night and they you know all these journalists who are doing the most amazing work they don't often get the chance to be you know hailed and heralded as they were last night and on the one hand you're seeing this on the other hand you just know talking to you know having spoken to them there are so many conflicts going on around the world they are stretched more than ever so they need to you know make their resources go further There's a great piece on broadcast today that following the BBC's charter review, which said the BBC said that production costs have gone up by I think it's around 7 % across all genres over the past five years or so.

47:01Tara Conlan: These conflicts are going to make, you know, the cost of living go up. They are also going to make production costs go up. The cost of getting, you know, a reporter to the other side of the world are going to go up. So on the one hand, TV is looking like it is still very attractive for advertisers. And that's something that the traditional TV can broadcasters can leverage. On the other hand, they are being stretched on the other side by the increase, you know, the production inflation.

47:29Matt Deegan: Yeah, it is a massively changing sector, as we talked about a lot on the show. Right. Just enough time for the Audio Network Media Quiz.

47:39Matt Deegan: so three media stories are viewed to the prism of another piece of ip this week it's called call my media bluff for reasons no one under 40 will understand for each round i'll offer you three descriptions of what actually happened now one happened this week two are fakes and once again alex audio network has deeply researched 1970s youtube to create a playlist to score today's game it's a best of three you'll both get a chance to answer just tell me which one is the real deal let's play media bluff so story number one a respected uk national newspaper was formally censured by press regulator ipso this week three definitions of why but which one is true a the paper published a column in which a financial expert offered advice on avoiding inheritance tax.

48:33Matt Deegan: It later emerged that the expert had no financial qualifications and no trace of them could be found anywhere. Is it definition B? The paper published a story about an investment banker earning£345 ,000 a year who claims rising private school fees meant he could no longer afford five holidays. The family turned out not to exist. Or is it C? The paper published a profile of a rural family struggling with rising energy costs. The family complained they never agreed to be profiled and had never spoken to a journalist so a b or c omar financial expert investment banker or struggling family it's scary how plausible all three of those are

49:14Omar Oakes: um i'm pretty sure that i saw that this was the telegraph which it was b wasn't it there was this this husband and wife who was supposed to be earning yeah 350 grand a year and they couldn't take the five holidays they wanted to take and it was terrible and it turns out that it was completely wrong. Tara, did you say this?

49:35Tara Conlan: Yeah, same, B, and yeah, because of the rise in private school fees and it turned out to be coming from a financial planning company. Yeah, Ipsate found

49:45Matt Deegan: a serious failure over accuracy. The Telegraph insists the article was not AI generated.

49:52Tara Conlan: Apparently, yeah, it was real, but it was real kind of catnip to Telegraph readers. But the thing was, one of the children was called Barry. I think they were called Barry and Harry. It was Ali, Barry and Harry.

50:02Matt Deegan: Yeah, that should have been a red flag, shouldn't it? I know. Okay, story number two. A network of UK media websites has caused outrage in the industry this week, but why? A, a tech publisher was found to have instructed AI to write positive reviews of his advertisers' products without disclosing it to readers. B, a clutch of UK gaming websites fired their entire editorial staff and replaced them with AI-generated journalists. Or C, a digital sports news service was discovered to have been generating AI-written fan mail to demonstrate reader engagement for advertisers. Tara?

50:39Tara Conlan: See, again, you're right. A and C are probably happening as well. But again, I think it is B. This is a video gaming website and they decided to axe a load of the journalists and instead create these terrible-looking, not terribly realistic-looking, I thought, fake journalists. Again, with weird names, but something like Brian Married You or something.

51:06Matt Deegan: Yes, Brian Marry Gold popped up. Yes, you're right. This is UK gaming sites, Video Gamer, The Escapist and Esports Insider. So things that existed and obviously had SEO and had people used to it. Taken over by SEO agency ClickOut Media. I mean, you know there's going to be trouble straight away. They fired about 20 editorial staff, replaced them with AI writers. Brian Merigold has an AI-generated face and biography describing him as an experienced iGaming and sports betting analyst and a lifelong gamer at heart. Okay, final one. Entirely AI-generated media project has become a surprise hit this week.

51:48Matt Deegan: What is it? is it a an ai podcast analyzing millions of pages of the jeffrey epstein files be an ai generated podcast about the post office scandal or see an ai generated podcast with daily summaries of uk parliamentary debates but having to be taken down because of a complaint from hans

52:06Tara Conlan: tara um i think it's the first one it's the epstein podcast yeah yeah yeah there were yeah

52:14Omar Oakes: there was this epstein files podcast where somebody had managed to kind of mine all this information and there was no humans involved at all apparently this is the epstein files podcast built by an

52:25Matt Deegan: entrepreneur adam levy it went from nothing to the apple podcast top 10 in 10 days uh levy said uh people don't want bullshit just tell me the facts um do you think like when it's pure information this is the right thing that should generate a podcast when i read this i was thinking you can't

52:40Tara Conlan: replace you, Matt. You can't just spit all of, you know, put all of media into a machine and get it to spit out and create the kind of chemistry that you have and all your knowledge. But that's essentially what they're doing, aren't they? And they're saying, again, one of my old bosses, Emily Bell, who's quoted in an article about it, and she said, the first one, quite interesting, as it went on and you get the same AI kind of like AI generated voice, it becomes a bit boring. So, But, you know, it's done well in the Apple podcast charts, hasn't it?

53:12Matt Deegan: I think there's some stuff that probably does fit this world. So if it was listening to earnings calls or perhaps something like that where it's kind of pure factual. If you get to something where, I don't know, I mean, the Epstein files, there's a lot of lies in there, a lot of misinformation in there, a lot of just conjecture in there. That's tough data to convert.

53:33Tara Conlan: Again, you need human oversight and curation, don't you, to check, to fact check. And I think the guy, Adam, had said, you know, I did make sure it was cross-referenced and sources were flagged up. So it probably has its use and its place.

53:47Matt Deegan: Well, I think that makes you both our joint winners today. If you can both go off and find a way to automate the media pod for next week and just have an automated Mac and have a holiday, it'd be quite nice. My thanks to Tara and Omar. Also, thanks to Alex at Audio Network for supplying today's music. Remember, Audio Network can do that for you as well. just head to audionetwork.com or if you can't remember that there's a link in the show notes before we go Omar how can people keep up with you and your work

54:15Omar Oakes: you can follow my newish substack everyone's doing a substack nowadays adverse reaction it's called and I still write for my old publication The Media Leader and you know just google me

54:28Matt Deegan: and something will pop up I'm sure in AI mode excellent yes there'll be an AI description that might be correct who knows

54:34Tara Conlan: that's a great substack name by the way Tara? Yes, Guardian Broadcast RTS also a substack I write the Indie Labs Indie Hustle substack as well RTS Television Magazine which I learnt last night is the oldest television journal apparently set up by John Logie Baird

54:53Matt Deegan: It's a very good read if you're an RTS member

54:55Tara Conlan: It's really good

54:56Matt Deegan: Check those out, I think we link to the substacks on the website as well Thank you for listening and watching My name's Matt Deegan, the producer is Matt Hill It was a Rethink Audio production with video support from Podcast Discovery. We'll see you next week.

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56:14Omar Oakes: Non-stop innovation and fresh finds daily. Explore what's new and what's next on The Drop by GNC. So retrospectors, what historical events are we ticking off on this week's run of Today in History?

56:28Tara Conlan: On Monday, ear hooks, lenses and bifocals, a brief history of spectacles.

56:33Omar Oakes: On Tuesday, the anniversary of the day Francis of Assisi first put on his sackcloth. On Wednesday, the dapper French businessman with a garden full of dead bodies.

56:41Tara Conlan: On Thursday, it's the 89th Academy Awards and the winner isn't La La Land.

56:45Omar Oakes: And on Friday, throw me something, mister, how Mardi Gras came to America. That's Today in History with the Retrospectors. 10 minutes each weekday, wherever you get your podcasts.