The BBC has published its formal response to the UK government’s ongoing consultation about the future of the broadcaster. Among other things, it discusses possible changes to the way the BBC is funded, though raises concerns about replacing the current licence fee model with subscriptions or ads.
The current Royal Charter that sets out how the BBC is governed and funded expires at the end of next year and the government is currently consulting on how the next Royal Charter may differ from the last. The deadline for submissions to that consultation is this coming Tuesday.
The BBC is very important for the British music industry, of course. It's a key employer and commissioner of musicians and composers. It’s an important licensee for collecting societies PRS and PPL. And it continues to play an important role in championing British music.
The music industry is generally very supportive of public service broadcasting and the BBC, though at the same time can be critical of specific decisions BBC bosses make. Separate from the consultation, the Scottish music industry has just put out an open letter criticising recent changes made at BBC Radio Scotland and the impact they are having on the country’s music community.
Formally responding to a green paper on the future of the BBC that was published by the government last December, the 118 page document put out by the broadcaster yesterday covers a lot of ground, but perhaps most interesting is what it says about funding models.
The BBC's primary source of income currently, of course, is the licence fee, that must be paid by every UK household that either watches any live TV from any broadcaster or on-demand content specifically from the BBC iPlayer. However, the number of households that that applies to is now shrinking as more people shift to watching exclusively on-demand TV programmes without ever opening up the iPlayer app.
So much so, says the BBC’s document, “the current model cannot maintain the BBC’s public service mission for the future”, because while “94% of people use the BBC each month” in one form or another, “fewer than 80% of households contribute”. Therefore, it says, “reform” is needed.
One obvious alternative funding model would be for the BBC to become a subscription service, with access to BBC channels and content only available to those who pay. Or the BBC could start putting adverts alongside its TV and radio programmes.
“A subscription BBC would mean a very different BBC”, the broadcaster’s document says. “It would not be universal, not provide something for everyone or cater to a full range of audience tastes and interests, or bring the nation together. It would turn a public service into a consumer product, excluding many households, particularly older people and people on lower incomes”.
Meanwhile, “a BBC funded by advertising would also be a different BBC”. And there are “well founded and longstanding concerns” about the BBC switching to a full-on ad-funded model, not least the fact doing so would inevitably take advertising income away from other commercial broadcasters, including public service broadcasters like ITV and Channel 4.
Some sort of evolution of the licence fee seems to be the BBC’s preferred option. The broadcaster says it is “keeping an open mind” on what that might mean, but it could mean extending the obligation to pay the licence fee to people who exclusively use video streaming services other than iPlayer.
Though that proposal is likely to result in a backlash from both the commercial video platforms and those viewers who don’t actively use BBC services, or at least feel they don’t.
For the music industry, any new funding model that dramatically reduces the BBC’s annual income would have a knock on effect, with less money to spend on music and music licences, and less airtime and space to support British music. Cut backs in recent years across the BBC - for example around the local ‘BBC Introducing’ shows - has already been a particular cause of concern within the music community.
In Scotland, a key concern at the moment is changes that were made last year to the late-night music output on BBC Radio Scotland. In a new open letter, the Scottish Music Industry Association says that - since those changes were made - less new music and less Scottish music is getting airtime in those late-night slots.
Comparing music played on late-night BBC Radio Scotland in the first two weeks of 2026 to the same time period in 2025, there was a 69% reduction in new music plays; a 67% reduction in new Scottish independent music; a 26% reduction in overall Scottish music; and a “marked shift toward catalogue music at the expense of contemporary releases”.
Late-night specialist programming on BBC Radio Scotland, says SMIA, has “historically provided a critical development pathway for artists, connecting creative work to audiences, industry opportunity and wider economic activity across Scotland’s cultural sector”. This seems to be under threat.
To that end, the trade group calls on BBC Radio Scotland to “undertake meaningful consultation with Scotland’s music sector and audiences to assess the cultural and economic impact” of the changes that were made to late night programmes.
And it should also clarify the rationale behind its late-night commissioning and publish a clear strategy on how the BBC will meet its public service obligations to support Scottish music discovery and development.