Philip Graf (Commander of the Most Excellent Order of the British Empire—CBE—a British honour) is deputy chairman of the United Kingdom’s Office of Communication (Ofcom), an independent body that oversees the UK’s communications industries. Ofcom’s stated duties are to further the interests of citizens on communications matters, and to further the interests of consumers by promoting competition; it is a sort of English information and broadcast ministry, but less proactive. Here to talk about regulation in media Graf spoke with Mint’s Rahul Bhatia on the first day of Ficci-Frames, Asia’s largest convention on media and entertainment.
How does Ofcom manage to retain its independence?
The structure under which Ofcom is set up makes that very clear. The board is determined to remain so. Ultimately, stakeholders recognize that our independence from government is very valuable for both parties. It is something we work very hard at maintaining, making sure that we are credible and evidence-based.
Who funds Ofcom?
It’s funded by levies from telecom companies and stakeholders such as broadcasters. We also take a percentage from the spectrum licensing that we undertake. There’s nothing taken from customers.
One of Ofcom’s stated duties is ensuring a wide range of television and radio services of high quality and wide appeal. Why should a regulatory body be involved in something like that?
What that’s about is ensuring there’s a level of broadcasting quality. If you look at it another way, we have limited spectrum for television. That spectrum is allocated to a number of broadcasters such as BBC, ITV, Channel 4 and Channel 5, and our job is to make sure that other broadcasters, in return for getting that spectrum—effectively gifted to them—have certain obligations to ensure that the whole broadcaster quality in the UK is kept up. If you look at most western governments, that sort of policy goal is there for nearly all of them. In the UK, public policy is delivered through Ofcom.
In your opinion, how involved should a regulatory body be in the media and entertainment industry. Rather, where should it draw the line as to what it will do and what it won’t?
We believe very much in a light touch regulatory approach. Which means that our bias is actually towards not intervening unless we have to. If you draw the line, it’s with a bias towards not intervening in the market.
You leave it to the broadcasters to regulate themselves?
There are two things here. The broadcasting code that we have implemented here is a code that is actually more about principles than about rules. It’s much more about output. We want to see broadcasters using their own compliance people to regulate themselves. Ultimately, we have under the Communications Act the power to respond to complaints and to look at potential breaches of our regulations. But everything we do is about encouraging people to self-regulate with us in the background, both in terms of editorial content and certainly advertising content. And as you heard earlier today, as we move to a multi-platform world, it’ll be more self-regulatory, and away from the world in which the regulator is going to tell people how they should use content.
Do you believe broadcasters are responsible enough to regulate themselves?
How has your experience with broadcasters been so far?
By and large, it’s been very good. What I would say is that while we want people to regulate themselves, we’re quite prepared to come down very heavily on those who don’t. Recently, we fined people up to $350,000 (Rs1.5 crore) for breaches of regulation. When someone doesn’t have good compliance, we’re prepared to come down on the company.
You said in your talk that when it comes to price controls, you only intervene when all other avenues have been exhausted. What kind of approaches are these?
I’ll give you an example. We sought to encourage British Telecom (BT)—historically the monopoly supplier of telephone services—to divide itself into two. Within the BT governance structure, there was an organization called Open Reach, which is obliged to provide on an equal basis services to alternative providers as well as BT’s wholesale and retail divisions. That helps in opening, for example, the broadband services.
So, there’s a competitive marketplace there.
We’ve also opened up voice telephony. That has happened by setting up conditions for competition. When that happens, you have competitive markets and you don’t need to have regulators imposing price controls and that’s the way we’ve got to work. There are still lots of price controls up in the telecom market, but obviously, it’s our intention that in the future, we’ll be using competition regimes rather than price-control regimes.
How do you deal with subjective things like racism and things to which people take offence?
We have a very formal structure when someone complains to us about anything. Initially, we decide whether it’s worthwhile accepting or entertaining. Should we accept it, we ask the broadcaster for its views. The people on our professional staff—most of them are journalists—look at the views, and form their own view. Should they come to a situation where they feel the complaint is justified, they then decide how serious it is, whether it merits sanctions. If it doesn’t merit sanctions, they go back to the broadcaster, which decides whether it wants to appeal it or not. If the complaint is serious enough to merit a sanction, then there is another stage to the process. There is a separate sanctions committee that decides the nature and the size of the sanction. It’s a very formal process that’s quite legalistic because people’s rights are involved.