Talking Point: The BBC in 2021 - Regional and Global
Entrepreneur Alex Connock, the founder of digital content business Pretend and co-founder of Ten Alps with Bob Geldof, gives his arguments for Manchester being a legitimate place to locate a global brand.
I would bet a pure gold BAFTA statue that everyone reading this has been on Google today. Or that half of you have a Mac or an iPhone. And those that don't - Microsoft Windows. Has anyone been on a Boeing jet this month? If not – it was an Airbus.
Driven a Toyota? Audi ? BMW ? Drunk Coke? Worn Gucci? Watched Man United or Barcelona? Why am I listing all these brands? Because they are world class and universal. And they are all based in a region, not a capital city.
Google is the most successful start-up in the history of the world, founded Menlo Park Califiornia - population 32,000, five times smaller than Harrogate. Facebook – Palo Alto, smaller than Grimsby. Microsoft and Amazon - both around Seattle, a quarter the size of Manchester. You can fit Cupertino, California, into Manchester 40 times– yet it's home to Apple. I could go on.
In fact, of the world's top 30 brands, guess how many are based in their country's capital city? Just four - 13 per cent.
The "world class brand" argument was used last year by critics of the move of a few BBC departments to Salford. The Daily Mail said shifting "gold standard" TV shows from the capital like Match of the Day could "inflict harm" on programmes.
Yet from the global evidence, it's not demonstrably the case quality equals capital city at all. So let's look at where we can go with that.
The BBC's initial move of 1,600 jobs to MediaCity in Salford is a success - a creative renewal. It's inspiring to go there. My suggestion for the next decade is to build on that excitement. And in a way that can actually protect the BBC's quality and range - this in the context of an at-best flatlining licence fee.
Two elements are linked to the plan. First, cut costs long term - by moving almost the whole corporation to the regions, and basing it in Manchester. The second is to grow revenues by building the BBC as a more global producer of content. To make that possible, use BBC Worldwide in Manchester to underpin even more of the output.
So the BBC in Ten Years time is this: "BBC North and Global". And as the lessons of Google, Intel, ebaY and Apple show us, going regional to go global is no contradiction at all. So, the first step is to cut long term costs by actually moving the BBC HQ to Salford which is cheaper. The capital cost of MediaCity was £189m. The new Broadcasting House building in London was over a billion. Factor the numbers moving in – and London looks twice the price per desk.
Staff are cheaper in the North too. Yet even today, about two-thirds of BBC people are still in London. That really must drop, simply to save the public money. Meanwhile moving North helps move Britain's economic focus too.
A PwC report this month said the North-South divide has widened in recession. Business distress in the North West is up by 12 per cent. It's dropped 6 per cent in London. Moving assets North is good for British society. So that's step one – cutting costs.
Step two is growing income. We should make the BBC much more global than it already is because exporting is good for the BBC and good for Britain.
Here's why - media content is one of our best exports - £17.3bn in 2008, 4.1 per cent of the total. We're the world#s number one TV formats exporter, with six out of 12 of the biggest of the last four years. The BBC already has the perfect export platform - BBC Worldwide - delivering £160m profit last year. So let's get the ball rolling.
Let's move Worldwide to Manchester, give it more input into what's produced, and more opportunities to sell BBC content overseas. Worldwide had revenue of £1.1bn last year, £600m of it overseas. BBC licence fee revenue was about £3bn. So about 15% per cent of total BBC revenues came from overseas sales. These are rough figures– but it's certainly far lower than at some other world-class UK media firms. Advertising group WPP got a massive 90 per cent of its revenue overseas. So it's 90 per cent versus 15 per cent.
That difference in emphasis is not a critique of BBC Worldwide – it's an opportunity for us all. Every new pound earned overseas by BBC Worldwide is a pound the licence fee payer does not have to pay for the services they want. So let's grow global revenue. I’ve discussed cutting costs by moving North, and building the BBC revenues overseas.
Finally, why is Manchester the right place to base the BBC?
Manchester isn't a provincial town – it's an export town. In the 19th century, it exported capitalism, when Cobden pioneered the free trade challenge to mercantilism. It invented communism too – in 1848 when Marx and Engels probably wrote the manifesto there. Today, Manchester has a big airport – which actually works. It exports football to Asia, Africa and Latin America. Manchester United has 20 million Facebook fans – which is 100 times more than BBC News.
Manchester has a talent base - 90,000 students, cheap offices etc. It's THE perfect place to create a cost-efficient BBC driven by export of British content. So let's get on with it.
* Keep up the incredible BBC programme of quality and cut no service, whilst not increasing the licence fee.
* Exploit its inventions ruthlessly – like actually selling iPlayer globally as an exasperated Eric Schmidt of Google recommended at the Edinburgh TV Festival.
* Prioritise output in programme commissioning that can capture the global audience. If Linkedin can add two new users per second, most of them in India, with content that is wafer-thin compared to your average BBC channel, then that’s where we can compete and win.
Let's take a quick step back. Some people might like to live in a kind of Countryfile version of Britain, listening to the Archers and reading the Daily Mail. But the real 21st century is a GLOBAL economic battle. It's do or die for countries, never mind companies. We need winning industries.
As it happens, we all own one as licence fee payers - the BBC. To sustain it for our own use, we must cut its costs and increase its global revenues. The global experience is – we can do that best from a region.
If you don’t believe me, just ask Disney, Nissan, Nike, Amazon, Universal or Intel.
Inventor James Dyson wrote a 2010 government report titled Ingenious Britain, about how to power up Britain's high tech exports.
He said: "We just need fuel, perhaps a bit of tuning, and most of all, a sense of direction."
The direction is M1, M6, M6 Toll Road if you think it's worth £5.10 to avoid the traffic, M6…..Manchester…. the world.
Alex Connock's thoughts were adapted from a keynote speech he gave to Bafta. You can follow him on Twitter @mralexconnock to offer feedback. Connock is also the chairman of the Royal Television Society North West and recently launched Pretend.