License Fees

The British Broadcasting Corporation (BBC) is an excellent example of a company gaining its primary source of revenue from license fees. Typically, a news site will rely heavily on advertisement sponsors to pay for the cost of running it. This is undoubtedly not the case for the BBC.

In fact, the BBC has a strict code of conduct, which restricts any forms of product placement. Brand names are permitted to be shown and talked about. They are not allowed to be given preferential treatment, however. It is a common practice for alternative competing brands also to be mentioned in these cases.

Typically, logos are covered up if they are visible during a broadcast. There are cases when brands are used merely as set decoration. In this event, they try to limit the amount of close up shots near it.

The reason for such strict guidelines on product placement is that the BBC wishes to remain impartial. This is in contrast to other news sites, which could have conflicts of interest between sponsors and news stories, that place them in a negative light. This can be seen in the case of Sky News. The company is sponsored by Qatar Airways. Therefore, they tend to put less emphasis on stories that might affect this brand.

Those who want to consume media from the BBC are required to pay an annual license fee. This money goes towards funding, not just the news department, but also their popular fictional programmes. The system put in place makes the BBC a unique news site for how it collects revenue.

However, there has been a criticism of this system as well. The license fee is continually increasing to fit in with inflation levels. This is making consumers feel shortchanged. The strictness with which licenses are monitored has also been criticised.