behind the news

Scandinavian public media fight for their right to grow

Potential regulatory changes spell an uncertain future
May 31, 2012

From cuts to controversies, NPR and PBS haven’t had an easy time of it lately. Indeed, the news last month that the National Endowment for the Arts had sharply cut its support for traditional PBS programs in favor of gaming- and web-based projects was only the latest disappointment for public broadcasters in the United States. In northern Europe, by contrast, public broadcasting has traditionally been funded very well and without controversy. But that, too, may now be changing.

Lately, the Scandinavian countries’ parliaments are proposing new funding schemes, and the European Commission is dictating new governmental regulations. As both economic and political pressure mounts, some journalists feel unsure of the future of their funding system—and of the editorial independence they say comes with it.

Modeled after the BBC and founded in the 1920s, public radio in Sweden, Finland, Norway, and Denmark are non-profit and advertisement-free. Public television followed in the 1950s. Public service broadcasting is central to Scandinavians’ lives, with an overwhelming majority of the public watching, listening to, or reading its news programming online every day. Surveys and studies of media consumption in the region consistently show that public service radio and television provide the most unbiased news, and are the sources of news most trusted by the audiences in their respective countries.

Operations are almost entirely funded by a yearly license fee that every household with a television (or, recently, with a computer) must pay. That fee, which ranges from about $300 to $450 per household depending on the country, is set by each country’s government. An independent trust in each country collects and distributes the fees so that the money is kept separate from the national budget, and several layers of buffers exist between politicians and appointments of the broadcast companies’ executives.

Journalists who work for these organizations say they appreciate the license fee funding system, because it ensures that their work remains independent of both the political landscape and changes in the economy. Politicians cannot cut funds from the broadcasters if they disapprove of the coverage they receive, or re-route money from the broadcasters to other projects, like hospitals or roads, at a whim.

Just as in the U.S., politicians in Scandinavia sometimes accuse their public broadcasters of having a political bias in one way or another. But unlike the U.S., those accusations can’t turn into threats of funding cuts.

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“It’s important to have direct funding, rather than to have the money go through the Parliament, which would then have to be in the budget and in the discussions there every year,” says Stein Bjøntegård, head of the news department at Norway’s public broadcaster NRK. “That would be a big problem.”

Tor Arnbjørn, head of radio news at Denmark’s DR, agrees. “I think that being a public service broadcaster makes everyone feel that they have a stake in what we are doing, and so whenever we do a kind of controversial story, they accuse us of being either left wing or right wing,” he says, adding that the license fee model and arms’-length staff structure both help to mitigate that. “I don’t think you can completely remove the political pressure, but it sort of keeps it a bit at bay.”

Throughout Scandinavia, public TV viewers and radio listeners generally accept the necessity of the license fee, but with minor grumbles. In Norway, for example, audiences living in the country’s vast rural regions have complained about having to essentially pay twice for NRK television—once through the license fee, and again for satellites to pick up the signal—according to Tor Erik Engebretsen at the Norwegian Media Authority, a governmental organization that regulates broadcast content.

In Finland, too, some objected to the fact that the license fee was the same for every household, regardless of income or number of residents, so that it was more of a burden for poorer households and people who live alone. That, and the fact that an estimated one in four households were evading the fee altogether, led to a change in the funding system in December. The Finnish parliament voted for a new, more progressive fee structure that will be calculated according to combined household income and then levied automatically on every residence.

Lauri Kivinen, director general of Finland’s public radio and television broadcaster YLE, applauded the change, saying that it would preserve YLE’s independence while making the system fairer for lower-income audience members. In Sweden, meanwhile, public broadcasters are fighting potential changes from a license fee to a tax-based system for its new charter, which will be announced this year and run until 2019.

Those who oppose folding public service broadcasting budgets into the national, tax-based annual finances point to historical precedents that give credence to their fears. Dr. Tom Moring, professor of communication and journalism at the Swedish School of Social Science at the University of Helsinki, cites the Netherlands and Iceland as examples. “The government declared that they would put financing of public service under the state budgets, with a guarantee of the level of financing,” says Moring. ”And a few years later, with a change of government, or a change of political and economical context, there were grave cuts.”

Perhaps the biggest challenge to the license fee system, though, comes not from these countries’ governments, but from the European Union—and the commercial competitors who are currently lobbying the EU to protect their interests.

Publicly funded TV and radio maintained monopolies in the Scandinavian countries for many decades, and the media markets have only opened up in recent decades. In Sweden, for instance, TV4 launched in the early 1990s as the first commercial competitor to the Swedish public television company SVT. In contrast to SVT’s slightly stodgy and authoritative style, TV4 had a younger, more spontaneous tone. Eva Hamilton, CEO of the SVT, believes this was great for SVT because it nudged them to improve their programming. “I think a monopoly’s never good,” she says, adding that TV4 immediately surpassed SVT’s viewership when it launched, and stayed on top until just two years ago, when SVT regained the number one slot.

Through the years, SVT has continuously updated its lineup, adding entertainment shows and sports games and other programs that have had the effect of making it resemble a commercial network—but without the commercials. PBS audiences in the U.S. accustomed to classical music concerts and Antiques Roadshow-type fare would probably be surprised to see the wide range of programs on SVT, from soccer tournaments to HBO imports like The Wire. This broad scope, says Hamilton, is vital to their mission to be a public service to absolutely everyone. “[Many people] will never enter the channel if they are not invited by entertainment, or sports, or whatever,” Hamilton says, “and then you can provide the nicest programs, and it won’t reach them.”

Some commercial television competitors in Scandinavia are calling all of this an invasion into their territory, and, more to the point, asking why public service broadcasters should get billions of kronor (hundreds of millions of dollars) every year to do it.

“If you have a competitor that starts each year with a hell of a lot of money, and we start with nothing, it is not very fair competition, you might say,” says TV4’s administrative editor-in-chief, Anders Palmgren. “Don’t misunderstand me: I think that public service is not something bad. But to go back to a monopoly is not good, either.”

Commercial television and radio networks aren’t the only ones upset with public broadcasters’ expanding their purview. Because public TV and radio are now available online—and often supplementing their audio and video newscasts with text articles—the broadcasters are now also competing with newspapers’ websites. Newspapers in the Scandinavian countries are not losing circulation and advertising revenue quite as quickly as their American counterparts, but it’s still a worry.

When Finland decided to change YLE’s funding structure from a one-size-fits-all fee to a progressive tax this past winter, the editor-in-chief of the Helsinki-based Helsingin Sanomat, the largest-circulation daily in Scandinavia, used the opportunity to highlight the unfairness of the system overall. Mikael Pentikäinen’s editorial criticized the new agreement for guaranteeing such generous funding for YLE without putting any restrictions on its expansion online, at a time when many other media companies are still wondering how to make any money online at all.

“We think they are pretty aggressive,” says Per Hultengård, attorney for the Swedish Media Publishers’ Association, referring to the public broadcasters. “I mean, they want to expand, they want to be on all platforms. Which is, from their perspective, natural. But when they are expanding on the local and regional markets, competing in more direct ways with the more regional newspapers, we think it’s fundamentally wrong… as they are financed by this fee that the government obliges its citizens to pay.”

In 2009, the European Commission announced that it would require public broadcasters to subject any new platforms or services to a “public value test,” an evaluation that balances the potential value for its audiences against the potential impact it would have on the wider media market. It would then be up to each member state to decide whether or not to allow the new service to launch.

According to Hallvard Moe, a media researcher at the University of Bergen in Norway, the public value test was first used by the BBC, but was soon embraced by the European Commission, and is now established policy in Finland, Denmark, Sweden, and Norway. (While Norway is not a member of the EU, it tends to align many of its policies with those of its neighbors.) The public value test requirement has not calmed public broadcasters’ critics, however, who say that market impact is necessarily hard to predict, and that its requirements are vague.

“This looks very good on paper, but it’s not really doing anything in practice,” says Hultengård—which is why his and other similar organizations are lobbying the EU for something stronger.

The public broadcasters, of course, oppose any policy that would hinder their ability to grow. Earlier this month, Jean-Paul Philippot, president of the European Broadcasting Union, which represents media organizations from 56 countries in Europe, defended the broadcasters’ right to expand online.

“For quite some time, public service media in Sweden, Norway, Denmark and Finland have served as examples for the rest of Europe by demonstrating the clear link between properly-functioning public service media and properly-functioning democratic societies,” wrote Philippot. “However…we must contend with interests at the supra-national level, who wish to confine us to a sort of ‘media ghetto’ by reducing our access to broadcasting spectrum and seeking to impose restrictions and more political control over our activities.”

As the lobbying by all parties continues, it remains to be seen what restrictions may be placed on public service broadcasters in future media charters. Scandinavia’s public service journalists and producers all argue that maintaining the current funding and regulatory model is crucial: direct funding from the public keeps them independent; in exchange for that funding, the public expects fast and thorough news and entertainment—both on air and online. Costs go up along with those expectations, but staying big, they say, is essential to the public service they provide.

“It’s a balance of confidence,” says SVT’s Eva Hamilton. “As long as we can provide quality programs, as long as we have a first-class news coverage, as long as we have many correspondents, and as long as we have the best cultural programs in the country, then everybody accepts that this is a public service.”

Lauren Kirchner is a freelance writer covering digital security for CJR. Find her on Twitter at @lkirchner