First Free Story (1 of 3)Join Skift Pro
Tony and Maureen Wheeler, founders of the Lonely Planet travel books, guided an entire generation of backpackers to the cheapest banana pancakes in Chiang Mai.
What a shame the people who bought the Wheelers’ publishing empire didn’t take quite the same care with the contents of their moneybelts.
Last week, almost unnoticed by the media, the BBC published its investigation into the extraordinary scandal that was its purchase of Lonely Planet.
The Wheelers might have come back from their first overland trip, in 1973, with only 27 Australian cents in their pockets — but in 2007 the corporation’s commercial arm, BBC Worldwide, paid £90 million for a controlling stake in their company, even as its young customers moved online and the market in printed guidebooks collapsed.
More About Lonely Planet:
- How and Why the BBC Messed Up its Acquisition of Lonely Planet
- Skift Q&A: Lonely Planet’s Founder on Ethics and the Future of Travel
- Opinion: Travel Guidebook World Is Shrinking, But Don’t Give Up Books Yet
Normally, the BBC makes the content – programmes or web pages – and BBC Worldwide sells it overseas.
But this deal relied on Worldwide, or Lonely Planet, making content, then getting the rest of the BBC to use it, which it was never going to do (it already had travel programmes, and Lonely Planet is based in Melbourne).
By 2011, as the investigation admitted, it was clear that BBC Worldwide had got “carried away” and that Lonely Planet had no hope of meeting its “highly optimistic” business forecasts. But that year, astonishingly, the BBC paid the Wheelers a further £42 million for their remaining 25 per cent stake — at “the original acquisition price” agreed in 2007, the investigation admits, “despite the significant under performance of the business”.
With a further £20 million invested in developing Lonely Planet, that made a total spend of £152 million.
In March this year, the BBC sold Lonely Planet for just £51.5 million, a £100 million loss. The person responsible for the deal left in December with an £800,000 pay-off. Why the corporation ever needed to own an Australian guidebook publisher in the first place has yet to be explained.
Last week, Lord Patten of Barnes, the BBC’s chairman, gave an interview to the New Statesman, protesting that the broadcaster’s recent severance pay scandal, when dozens of departing senior managers got a total of £6.8 million more than they were entitled to, was, though wrong, “not the most outrageous example I can think of mortal sin”.
To some, this sounded complacent – but it was, in one sense, true.
Compared with Lonely Planet and the slightly smaller but better-known fiasco of the “digital media initiative”, which wasted £98 million, mere single millions are small beer. Those two mistakes alone cost as much as the entire annual editorial budgets of five national newspapers put together. The digital media initiative was supposed to turn the BBC “tapeless,” but never worked properly and has now been scrapped.
On the day Baroness Thatcher died, BBC News couldn’t show archive footage until the boring old tapes, now banished to a distant suburb, had been brought in on the Tube by a member of staff.
The person responsible for the disaster was given a £140,000 bonus. Last week, too, it emerged that Lucy Adams, the corporation’s head of human resources, is having her libel action against the National Union of Journalists paid for by the BBC (she denies running a “dirty tricks” campaign against her own staff).
Miss Adams, who presided over many of the excessive pay-offs, is leaving after denying to Parliament all knowledge of an email about the payouts. She later admitted that she helped to write it.
Lord Patten protested that some newspapers had a “commercial” and “ideological” agenda in which the BBC got “bashed more than President Assad”.
No one at the BBC ever came close to Assad’s crimes, of course. But it is clear that, over the past few years, something has gone badly wrong at the top of the corporation.
There were cheers in the BBC newsroom when Miss Adams announced her departure. Just as in any Arab dictatorship, the BBC’s rulers have become a self-rewarding elite, a deadweight on their little broadcasting nation, who make their citizens — in this case, the corporation’s generally hard-working, underpaid staff — feel angry and ashamed.
As of April, despite £150 million worth of senior management pay-offs, there were still 437 of them, by the way — senior managers, that is; not unlike the Saudi royal family in extent, if not quite in riches.
Two hundred and forty-five — a number not including programme-makers, performers or journalists — make more than £100,000 a year. The Metropolitan Police, with almost treble the staff, only has 53. There is of course no comparison between the two organisations. How can protecting London from terrorists, murderers and rapists possibly compare with the onerous demands of supervising Cash In The Attic?
And though there is undeniably an ideological bias to the criticism, the corporation should be worried that it is starting to come from beyond the usual Right-wing suspects: from liberal newspaper columnists and, last week, from Roger Mosey, its own former head of news.
He suggested sharing the licence fee with other media to promote pluralism — an idea originally raised under Labour, then suggested again by Grant Shapps, the Tory party chairman, in The Sunday Telegraph three weeks ago .
The BBC’s “editorial voice”, argued Mr Mosey, “speaks too much as one to the exclusion of others. The BBC Trust speaks the language of diversity, but in its edicts it promotes conformity, whether it’s about an agreed approach to the science of climate change, “correct” terminology in the Middle East or the way a documentary about benefits should be “constructed”.
The “homogeneity” of the BBC’s news output, he said, was “intensified by regulation that sees there being ‘right’ and ‘wrong’ answers”.
For Mr Shapps and others on the Right, this was exemplified by the BBC’s attempt to disprove a Sunday Telegraph story about the large number of EU migrants without jobs — unfairly and inaccurately, in the newspaper’s view.
Some of what Mr Shapps said, of course, was the pre-election intimidation that all governments practise on the BBC. But there is more to it than that. Across the rest of the media, old advertising-based business models are crumbling. They can no longer support the plural, diverse media that we need.
The BBC, with its guaranteed tax-based funding, is ever more dominant. If it cannot become more pluralistic, and speak with a diversity of voices, then pluralism and diversity will have to be secured in other ways.
The question now is whether the opinion-former rebellion spreads to the TV-watching masses. In the end, that will depend on whether the BBC produces good enough programmes.
There is ominous evidence that the BBC’s lack of pluralism and layers of management are, indeed, stifling some of its output.
Perhaps the best external indicator of the BBC’s creativity and quality is how it does in the main broadcasting awards. The Sunday Telegraph has tallied the past five years’ worth of Bafta and Royal Television Society (RTS) and Sony radio winners — and the results are sometimes troubling. In many areas the BBC, it turns out, does not do quite as well as it should, given its utterly dominant position in broadcasting.
In the five sets of Bafta television awards since 2009, a total of 113 competitive domestic awards have been made. The BBC has won 62 of them, or just over half — not too bad, but it should probably have done better, given its vast disparity in resources over all its rivals.
It broadly dominates, as it always has, in comedy and does well, too, in entertainment. In drama, most years, it is matched or beaten by the commercial sector. Many of the most successful dramas of the past few years — such as Broadchurch and Downton Abbey — have been on ITV.
In radio, the BBC has won 64 per cent of the Sony gold awards over the past four years — again perhaps a little low, given that almost all “quality” radio in Britain is made by the Beeb. In the RTS television awards, it won 61 per cent. But the BBC’s most glaring weakness is in its journalism.
Over the past five years, in the RTS’s separate TV journalism awards, it has won just 39 per cent of the gongs, astonishingly low given that the BBC represents almost four-fifths of all TV news consumption in the UK.
At Bafta, the largest news organisation on the planet hasn’t won a single award for news coverage since 2006, and has only won it twice in the 12 years since the award was created.
It is, of course, news which suffers most from managerial interference, editorial timidity, and corporate centralism. And it is, of course, news, of all the BBC’s programmes, which politicians and other opinion-formers watch most.
The new regime under director-general Lord Hall has promised change.
But the number of managers is only coming down from 437 to a slimline 415 — by 2015. The BBC’s news bulletins, as the EU report suggests, show no sign of becoming less monotone.
The corporation may have to do more than that if it is to secure its future.