British Broadcasting Company was established in October, 1922 by the government. The British general post office initiated the establishment. In January, 1927, it changed to British Broad Casting Corporation. The channels from the media got fully established in 1932 when advanced electronic appliances were formed to facilitate the operations of British Broadcasting Corporation. During this time, the government had to fund the station in order to channel all matters concerning it. The government passed a bill that consented on collection of television license fee in which all British households with a television would be obliged to pay for services offered by the television station. This was implemented because the government could not get an alternative source of finance to facilitate the running of British Broadcasting Corporation. The government collected the revenues yearly so as to evade misunderstanding and failure to remit taxes by the same individual (Martin, 89).
As time progressed, the station also adjusted its operating strategies. This made the government to fully fund the station’s activities. The government exploited the domestic license fee to fund these activities. The revenue was collected from all British citizens who had access to the services offered by the British Broadcasting Corporation. Those who could not afford were forced to pay for their dues in order support the running of the broadcasting media. The government made sure that all individuals who accessed the station’s services were paying this fee. The government sent its officials to collect the revenues from citizens. The state did this so as not to funds that had been budgeted for other industries (BBC, 10).
In 1980s, the British Broadcasting Corporation got a formidable challenge from other United Kingdom television stations which had emerged and were operating privately. They challenged the BBC as it used government funds which were disbursed slowly into the station. This slowed down the pace of operations. This situation posed a stiff competition from the privately operated stations. The managers of BBC had to look for alternatives to counter this competition. They formed other branches of BBC which were funded from businesses. The managers decided to change the funding model since the process of getting the funds from the license fee took a lot of time and this slowed down the implementation of the station’s strategies.
Many countries had established the collection of television license fees. However, in the modern time, they have dropped this idea. This is due to the fact that several private televisions have been set up and they sponsor their services with efficiency. This out ways the television stations that are funded by the government. Once the government funds for a television station, it makes sure that the television broadcasts what they choose. Some challenges may not be channeled through government funded televisions. On the other hand, private stations air thorny issues concerning the society. This forms the basis of competition between theses stations (Stephen, 100).
Change of Funding Model
The kind of competition witnessed in the television industry has influenced most of the American television stations to reconsider their funding models in order to cope up with the ever changing market. Financial support from the federal state has made the television stations to experience a slow growth as it takes time before the fund is released to the specified stations. Due to this delay, many American stations have opted to fund for their operations through funds obtained from commercials and other private sector’s and individual’s programs. This venture resulted to a significant impact to the British Broadcasting Cooperation. The new venture made it to loose a substantial number of its client to other stations. This impact prompted the British Broadcasting Cooperation to start supervising its own operations and daily activities (Welch, 67).
The implementation of this change occurred over time. This also meant that the funding model would be altered in order to run the station’s affair smoothly. Eventually, it stated utilizing funds obtained from advertisements just like other media stations in the United Kingdom. The industry was almost collapsing since a small percentage its clients and citizens supported this idea. This occurred since people disliked the aspect of fee collection that was intended to boost the operations of the station. The people felt that this was unfair as other stations did not employ the same tactic. Faced with this challenge, both the government and the broadcasting station had to sort for an alternative source of funds. They started publicizing novel products in the market so as to amass funds which they used to channel innovative programs to the market (BBC, 5).
Other television stations in United Kingdom and across the universe used commercials’ money to fund their operations because they were managed by their owners. These owners solely determined the amount of funds to be channeled to a particular operation. This situation could not be experienced in the British Broadcasting Corporation as programs were determined by government. This monopoly was granted to the government as it was the sole provider of funds used for running this station. The government officials in charge of the revenues were corrupt. They did not allocate the entire collected cash money as required. They only delivered a fraction of the whole some (Stephen, 76).
The government was in charge of the revenues gotten from the television. The management was left with insufficient amount of cash for the running of daily operations in the station. Employees could not be motivated in any way as quite a large amount of cash was taken by the government. This condition contributed to the migration of several workers to the privatized stations. In addition, the fact that the private firms were motivating their workers enhanced the departure of these workers from British Broadcasting Corporation. The private sector embraced workers from the government sector as they had sufficient experience and training. The BBC lost most of their workers to the private sector. This triggered the managers to retract their steps in order to salvage the situation. Their options included: changing of the funding model and the motivation of their employees (Martin, 56).
Benefits and Drawbacks of the Current Model
The current funding models employed by the British Broadcasting Corporation include: money from commercials and the license fee money. This corporation applies this model in acquiring finances so as to run their daily errands. Money obtained from advertisements is utilized to facilitate other programs. The television station is endowed with the ability to budget its finances and allocate it to various projects run by the station. The advertisements rack in a lot of money that could be spent effectively. The television at times makes enormous income which it could not have obtained from the license fee (Stephen, 67).
An employee gets motivation from his or her work. Persons in the marketing and sales department get commission for what they sell as they return their sales to the television station. The finances are managed from the company. This enables the managers to easily reward those employees that display exemplary performance as they have money at their disposal. Motivation of this kind facilitates excellent performance among the employees hence success of the station. The television station in turn offers better salaries to its employees and this improves the living standards for the workers. The improvement of living conditions of employees promotes the lives of their family members, and this in return improves the economy of the country (Welch, 67).
There are repercussions associated with the current models. When a station depends on funds from commercials, it means that the client may decide on the type of service to be offered to him or her. This scenario may make the television station collapse or overwhelm the savings hence leading to zero profits. Moreover, the station’s competitors may buy the client by lowering the fee charged for advertising a product. This offer may appeal to the client making him or her to shift to the new station hence causing loss to the previous station. If income gets low, operations in the station will be hampered and this may lead to the downfall of the station (Stephen, 46).
Returns from commercials may tempt the people finance managers and the chief executives of a station to misuse the cash. If the firm has dishonest officers, the money may be looted. In case of such a scenario, the company may collapse and will also loose sponsorship from the government. Another way of obtaining funds is through charity. This may be contributed by non-governmental organizations. In case of any mishaps, such organizations withdraw their aid. A station may also decide to take a loan. Loans from banks and other financial institutes have high interest rates. On completion of loan payment, a firm may have lost a substantial amount of cash due to the high rates charged by the lending institutions. Advertisements’ money may not be sufficient to repay the loan. In this case, the financial institution may resort to taking the firms properties as compensation of the loan (Welch, 25).
British Broadcasting Corporation Radio
There exists a BBC radio station which broadcasts programs through the radio. The radio station borrows its management system from the television station. Those who manage television still have the mandate to run the BBC radio. The news channeled through this media is similar to news transmitted by other stations such as CBC or CNN. The radio station is managed with the same funding model that is used in the television station. The difference between the television and radio stations is only the type of programs being broadcasted. The rest of the operations are similar as both stations are run on the same funding model and similar managers (Stephen, 125)
The models applied in the American television stations are similar. Nevertheless, there may exist some differences. Most of the stations in America are funded by money obtained from commercials and charity. There are numerous television stations in the United States that are owned by private companies or persons who get financial support from donors. The British Broadcasting Corporation models resemble those found in America as this station has employed some universal methods in the process of improving its performance and establishing itself as a universal brand. The same methods are evidenced in America since most of the American television stations have a worldwide appeal. They channel their programs all over the globe. They use of funds obtained from donors and commercials to facilitate these operations. A small fraction of television stations from America get the license fee to run their programs (Martin, 102).
Effects of the Models
The models put in place affected the people socially, economically, and physically. The license fee charged on individuals made them have little money to save for their families. This was because they paid a huge amount of tax. Those individuals who could not afford the fee were prosecuted in a court of law which imposed higher charges as fine. This spelled doom to a lot of people and increased the level of poverty among the people. Frustration and depression became part of most individuals who could not afford this fee. The prosecuted individuals became disheartened by this action and their work performance reduced significantly.
The families of the affected individuals faced psychological trauma. This meant more trouble as they were forced to seek the services of a counselor and this meant more expenditure (Lewis, 25). Studies have been carried out to put forward the most suitable models to be employed in media and television. The models applied in turn bring complications in the performance of the television. All models have their advantages as well as disadvantages. Therefore, for one to be recommended for use, these factors have to be considered. Televisions stations should apply various models so as to come up with a specific one serves their needs perfectly. This will guarantee better services hence success (Stephen, 105).
The British Broadcasting Corporation has changed and advanced its funding models from time to time. The broadcasting media has employed the required models so as to improve their performance and to maintain their reputation as a leading broadcasting station in the universe. To achieve their objectives, the managers of this media station have expressed excellent managerial skills so as to settle on the most appropriate model that would guarantee success once adopted.