Sky urged to waive BBC transmission fees

The BBC has said that it could save £50m over five years if Sky waived the cost of carrying the corporation's channels on its satellite platform, enabling it to reverse planned cuts to BBC local radio and BBC Four.

Research commissioned by the BBC has indicated that the BBC pays around £10m every year to "retransmit" its 49 radio and TV channels on Sky, reports The Guardian.

John Tate, the BBC's head of policy and strategy, praised Sky for having "taken a lot of risks" and done an "excellent job" in injecting money into UK-produced content.

However, he feels "that in the context of a very tight licence fee settlement, payment from us to them of retransmission of what are to them highly valuable services is not appropriate".

With the government currently negotiating the new communications bill for next year, Tate said that it could be viewed as "de-regulatory" for ministers to remove the requirement for the BBC to pay retransmission fees to Sky. The fees ensure that Sky's 10m-plus subscribers receive the correct version of BBC One for their region.

Tate said that he had held talks with ITV, Channel 4 and Channel 5, and they also want the government to look at retransmission fees. However, the commercial broadcasters feel that Sky should pay them for retransmission, rather than the other way around.

As channels such as BBC One and ITV1 are hugely valuable to viewers, it has been argued that pay-TV platform holders such as Sky should pay to offer them to their customers.

But Tate said that the BBC is "not looking for payment" from Sky for airing its channels, but instead was looking for the satellite broadcaster to waive its own fees.

He said that such a move would be "equivalent of not having to make reductions in output on local radio plus the reduction of BBC Four… it's roughly £50m over the period".

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However, a Sky spokesman said that asking the firm to provide free retransmission of BBC channels would be like asking the National Grid to provide the corporation with cheap electricity.

"The BBC chooses to buy platform services from Sky that enable it to provide a wide variety of services on the satellite platform. As with any broadcaster who uses our open platform, we ask for a fair and proportionate contribution towards its running costs," he said.

"Of course if the BBC no longer wants to buy these services from us, it is free to stop doing so at any point. But these are legitimate operational costs, which are regulated by Ofcom, and all broadcasters who choose to use our platform pay them.

"We don't see the BBC as being the exception to this principle. No-one expects the National Grid to provide the BBC with cheap electricity subsidised by its other customers, so why is Sky any different?"