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The BBC's iPlayer Goes to Parliament, by Sean Daly
Sunday, January 20 2008 @ 06:34 PM EST

The BBC's iPlayer Goes to Parliament
~by Sean Daly

The British Broadcasting Corporation officially launched its ambitious iPlayer client, a video-on-demand "catch-up" service limited to UK residents, on Christmas Day with a massive promotional push which resulted in a million viewers watching over 3.5 million viewed programs. Launch TV advertising notwithstanding, this is unquestionably a sign that the era of "time-shifted on-demand" video over the Internet has arrived.

Amid the celebrations however, Mark Thompson, Director-General of the BBC, faced stiff questioning last week before the UK Parliament House of Commons Public Accounts Select Committee which wanted to know more about the Beeb's efforts to cut spending and in particular the costs of the massive iPlayer project. The hearing followed the publication of a National Audit Office report [PDF] on BBC Procurement.

Information about the meeting can be found here. There is a video of the 92-minute hearing available for viewing for a limited time, but unfortunately, it is in Microsoft Windows Media format and is not seekable, meaning it is not possible to fast-forward or rewind. The UK parliament website suggests that everyone use Windows, which is ironic since it is precisely this kind of proprietary-standard approach which has dogged the iPlayer project these past three years and drawn the ire of the UK's Open Rights Group and the Open Source Consortium.

We have written to Parliament's audiovisual department seeking permission to present the film here in Ogg Theora format, but there is a complex and expensive licensing scheme to deal with which is clearly meant for broadcasters. We hope to have the video or audio in an open format at a later date.

The HoC Public Accounts Committee has just published a transcript of the hearing and it is fascinating reading for those unable to view the video. It is important to note however that although official, this is the "uncorrected" transcript, meaning that neither the BBC witnesses nor the MP committee members have had the opportunity to correct the record; the transcript in this form is not yet the approved formal record of the proceedings which may take weeks to prepare.

I'd like to draw your attention to a series of questions asked by Member of Parliament Dr. John Pugh. Dr. Pugh is clearly aware of the iPlayer's shortcomings and asks about the project's total cost. You may remember we asked this same question during our interview last November with Ashley Highfield, the BBC's Future Media and Technology Director, who told us then that the iPlayer client development cost was 4.5 million. At this hearing, Ms. Zarin Patel, BBC Group Finance Director, testifies that she does not have the precise figures to hand but estimates the cost at 20 million. Mark Thompson adds that this figure includes salaries and not only procurement items. As the BBC witnesses are unable to respond to the question in detail, Dr. Pugh asks that correct figures be forwarded to the Committee. And later, as I'll show you, the figure was corrected downward. Please note that Zarin does make it clear at the HoC meeting that she didn't have the exact figures to hand.

He is also worried that the BBC's initial Microsoft-only policy constitutes illegal state aid, a situation which could subject the UK Government to an investigation and sanctions from the EU. He was concerned enough to write to the BBC's Director-General the day after the hearing. We have obtained the letter [PDF] which we present as text below, along with the portion of the HoC PAC questions relative to iPlayer.

We asked the BBC for clarification concerning the cost discrepancy. In a statement, the BBC said:

The figures for the total estimated spend on the BBC's on-demand proposals are as follows:
  • 131 million was the forecast for the total cost to the BBC for its on-demand proposal over a five year period (start 2006/07). This includes rights costs and other operational and technical costs.
  • The 4.5 million discussed in November was the total spend at the time for the development of BBC iPlayer.
  • However, this figure now stands at 5.7 million. The increase is due to current year spend now being included in the figure.

The "viewer-facing" iPlayer is, in fact, the visible part of a major internal project to transition from tape-based video archives to digital. Some information about this huge project can be found here and here. Mr. Highfield referred to this project in our interview and you will see that Mr. Thompson does, as well, in his testimony below.

The initial Windows-only architecture of the iPlayer, and the only version to actually offer download "catch-up" viewing today, runs exclusively under Windows XP and Vista (previous versions are not supported) with Microsoft DRM and Verisign Kontiki centrally controlled P2P which requires [EULA] iPlayer users to donate their bandwidth. The BBC says that DRM is necessary to protect content rightsholders, in particular "indie" production companies.

What content companies invariably seem to underestimate is the fear and loathing most people feel toward DRM and their willingness to avoid it whenever possible; the record companies took years to figure this out. The streaming iPlayer version, built around Adobe Flash, has according to the BBC been preferred by users by a factor of 8 to 1. Could it be users don't want to install software they can't turn off which monopolizes their bandwidth and phones home to Microsoft?

Why hasn't the BBC built upon its own GPL'd, patent-unencumbered, scalable audiovisual codec, Dirac, a codec which has come far since its beginnings in 2004? Mr. Highfield has just indicated that the iTunes platform could be acceptable to rightsholders with the new "time-bomb" extension of Apple's FairPlay DRM.

Erik Huggers, the former Microsoft executive referred to in the testimony (and who has said "my loyalties are to the BBC and the BBC alone"), has just hired Dirk-Willem van Gulik, former President of the Apache Software Foundation, which is good news for him but unlikely to be welcomed by any of the BBC's 1800 "compulsory redundancies" worried about their jobs.

Has the time has come to ditch the Windows/Kontiki iPlayer client, and the millions of pounds of development and Microsoft and Verisign software licenses that went into it, or at the very least communicate more openly the costs associated with a project in which Microsoft has pride of place to the detriment of license fee payers having chosen other systems? Curiously, I could find no report of the committee meeting on any of the BBC websites, with the single exception of this blog post which appeared following our questions.

Here's the transcript, followed by the Dr. Pugh letter:

**************************************

Q14 [12:17]

Dr Pugh: As I understand this Report, you have met your 75 million target for this year but your annual expenditure is actually up and the explanation of that is because of one-off expenditure of one kind or another such as development and some expenditure on property and workplace. Is that correct?

Mr Peat: The savings that are set out here are those audited by the NAO.

Q15 [12:43]

Dr Pugh: The savings are real but there are additional items which you would not buy every year, as it were.

Mr Peat: Correct.

Q16 [12:49]

Dr Pugh: And clearly one of those you have just mentioned is the iPlayer. How much has that cost to develop, bearing in mind that not all the costs may be in one year?

Mr Peat: I would prefer that Zarin gave that information.

Q17 [13:00]

Dr Pugh: How much has it cost to develop the iPlayer?

Ms Patel: I do not have the figures to hand. I believe that it was somewhere in the region of 20 million all told over the last two or three years but I do not have that exact information to hand.

Q18 [13:13]

Dr Pugh: Could you send us the figure?

Ms Patel: Yes, of course.

Q19 [13:15]

Dr Pugh: How long has it taken to develop in all?

Mr Thompson: You will understand of course that only the sub-set of that cost comes under the category of procurement. For example, staff costs of BBC staff would not be included in the category of procurement.

Q20 [13:31]

Dr Pugh: So the iPlayer costs may actually be considerably more than that and some of it will be procurement?

Mr Thompson: I think the figure quoted is the total cost of which only a proportion will be procurement.

Q21 [13:41]

Dr Pugh: What was the cost of making the iPlayer partially interoperable, because that was an additional cost incurred during this year was it not? Initially it was only working on Windows XP via Internet Explorer. I believe, I have not tried, I can now get it to work on my Mac; for some things anyway. I can stream but I cannot download.

Mr Thompson: It should be working on your Mac. If it is not, I will pop round and have a look.

Q22 [14:10]

Dr Pugh: Interestingly enough, I did try on the House of Commons Windows computer and it crashed. But that is possibly a separate issue.

Mr Thompson: It may be a problem at your end. Who knows? The plan with the iPlayer was always to make it as widely available across different platforms as we could and the main consumer launch of the iPlayer, which happened on Christmas Day, when we actually launched it to the public fully ---

Q23 [14:37]

Dr Pugh: So it was planned expenditure; nothing to do with the protests which were voiced at the time.

Mr Thompson: No. To be honest people feared that the BBC might be planning a cosy and exclusive relationship with Microsoft. It was always planned; it was a requirement of the BBC Trust but, to be honest, it was always the management's plan that this product would be available for people using different systems.

Q24 [14:57]

Dr Pugh: It had nothing to do with the fact that your group controller of future media technology actually came from Microsoft and was hired from Microsoft.

Mr Peat: It was a condition of approval by the BBC Trust that the full availability through different systems should be accelerated.

Mr Thompson: What was true was that some of the initial consumer tests were available only for use in the Microsoft Windows and Media Player environment, but that was at the testing stage. It is absolutely core to the BBC that we make our services as universally available as possible and that, in the context of the web, absolutely includes the availability of services on different platforms.

Q25 [15:40]

Dr Pugh: So at what stage will we be able to fully download and screen to a Mac or a Linux computer?

Mr Thompson: You can do that now.

Q26 [15:48]

Dr Pugh: Both of them?

Mr Thompson: Yes.

Q27 [15:51]

Dr Pugh: Why, in a sense, did you develop your own piece of kit? There are actually things you could have procured. BT Vision is one product, BitTorrent is another which are both developed and fully interoperable as far as I understand. Why go to all the trouble of procuring your own system which in a sense you could have bought off the peg?

Mr Thompson: The iPlayer, the application of the iPlayer, the client application and the way programming media files are both encoded and transported from server to client, is not a bespoke BBC creation.

Q28 [16:44]

Dr Pugh: Some applications elsewhere are actually better, are they not?

Mr Thompson: It is an assembly of existing pieces of technology. We package some different pieces of technology, but it is not as though we have gone out and invented our own peer-to-peer or digital rights management systems; these have been packaged up. A significant part of the cost of the iPlayer is to do something rather different which is that the nature of this application and, if you like, the promise of the application is that people will be able to catch up on ---

Q29 [17:13]

Dr Pugh: I know that.

Mr Thompson: There is a substantive point coming. Re-engineering the BBC itself, such that automatically we can get hundreds and hundreds of hours of television and indeed alongside our existing radio on-demand services, encoded, available to be downloaded with all their rights cleared and all the rest of it, has meant getting dozens of different existing systems to talk to each other. So a significant part of the development challenge and of the cost of iPlayer has been around organising an end-to-end digital delivery of the content to iPlayer. Nobody anywhere in the world has tried to offer so much content so quickly in real time to the public. What is unusual about the iPlayer is not the functionality of being able to download programmes; it is about the sheer quantity and the fact that it refreshes every day. It has been the back office side of the content delivery which has been a large part of both the technological challenge and also a significant part of the cost.

Q30 [18:24]

Dr Pugh: But can you not understand the view that you spent clearly much more than 20 million on developing this piece of apparatus and its application which when it downloads the marvellous content of the BBC cannot even tell me how much I have downloaded in terms of megabytes and so on, can it?

Mr Thompson: We have decided to keep the user interface.

Q31 [18:48]

Dr Pugh: BitTorrent can tell me how much I have downloaded: the BBC cannot tell me.

Mr Thompson: We have chosen to offer a user interface which is very simple, very clear and which, if I may put it the other way, is not going to put off people because it offers vast amounts of complex information about megabytage and screening rates and all the rest of it. If you go on to the iPlayer right now, in two or three clicks you can be watching Sense and Sensibility. What we are seeing is that about a million people have already tried iPlayer. It has only been launched since Christmas Day and the stream is full.

Q32 [19:26]

Dr Pugh: In two or three clicks I could be exceeding the limit on my broadband connection and I would not know. In a sense you have developed an application which is of limited use to the consumer and spent an appreciable amount of money on it.

Mr Thompson: I am not going to suggest that we are not going to continue to develop the iPlayer and to listen to our audiences about ways in which we can improve it. Clearly it will not be difficult for us, if it is not already there, to include in the interface information about the use of bandwidth and streaming rates and so forth for those who want it. In the first week the iPlayer's day-to-day growth was around 20% per day. To be honest, all of the evidence we have had and the feedback we have had is that consumers are enormously enjoying using the iPlayer; around one million people in this country have tried it already and we are a fortnight into its launch. It is growing very strongly. It is very simple and easy to use and, I have to say, so far it has got off to a very good start.

Q33 [20:30]

Dr Pugh: Moving on to that heading of People and Resources, it also includes recruitment agencies. Presumably with a large number of people currently being laid off by the BBC, your expenditure on recruitment agencies is scheduled to dive, is it not, because you are not doing much recruiting, in fact quite the reverse at the moment?

Mr Thompson: The total number of people working for the BBC is reducing. The total pay bill of the BBC, staff, freelance, casual, temporary, is also reducing and will continue to reduce. However, clearly and iPlayer will be an example, some of the big other technology projects we have, some of the other major one-off projects we have sometimes require specialist skills and specialist resource which we need on a temporary basis and that will continue.

Q34 [21:27]

Dr Pugh: Are you telling us it may not fall because you may need expensive headhunters to find the right people to develop applications like iPlayer?

Mr Thompson: As I tried to explain to you about iPlayer, iPlayer is a bringing together of many existing applications which are being developed by third parties and where the BBC pays a modest licence: the Kontiki DRM peer-to-peer technology, the Adobe Flash video streaming technology and so forth. I do not accept the premise that the BBC, as it were, has been creating entirely new applications on its own. What we have been doing is bringing technologies together to produce what we do think is needed.

Q35 [22:13]

Dr Pugh: With all due respect, you are answering the previous question. Recruitment agency funding is not likely to fall then despite the position the BBC is in?

Ms Patel: In 2007-08 we are now back down to our normal levels with 35 million spend projected for this year, which is in line with an historical level. So the hump of spend we saw, the kind of spike of spend that we saw both on our change projects, on iPlayer and other technology projects, has now come back down to normal level.

**************************************
**************************************

January 10, 2008

Dear Mark,

Following our discussion at the Public Accounts Committee yesterday, I thought it might be useful to underline the main point I wished to make.

It can be argued that iPlayer has not been the best piece of procurement done by the BBC that it lacks such obvious features as indicators of download file size -- useful to the consumer on limited broadband -- or true high quality encoding differentiating it from other currently available, off the peg applications.

I do recognise that that it has an attractive interface, is user friendly and addresses digital rights issues so I stop short of suggesting the BBC has bought a lemon.

The more fundamental issue is its failure to apply open standards and be sufficiently interoperable to work fully (streaming and download) on more than one platform. The BBC is funded by licence players not all of whom have or chose to use a computer running Windows XP or Vista. By guaranteeing full functionality to the products of one software vendor it is as a public body handing a commercial advantage to that company -- effectively illegal state aid!

The aspiration to eventually (you said within two years) remove this advantage does not rebut this charge. A promise of amendment is never sufficient excuse for past sins or indeed much of an explanation.

Most major web based developments of any scale these days work on the presumption that interoperablity, open standards and platform neutrality are givens. It is not clear why the BBC design brief did not specify these requirements or if it did what technical problems -- given the expertise available -- hinder them being implemented.

So long as the iPlayer is bundled in with Windows/Internet Explorer it continues to run the risk of breaching state aid rules -- as the benefits it thereby bestows on Microsoft (with their somewhat blemished reputation for fair competition) come via the deployment of the public's licence money. What might be a pragmatic choice for a privately funded company becomes deeply problematic for a public corporation.

I recognise and welcome the assurances that the BBC and you personally have given on this subject but wonder whether the sheer novelty of the new media has blinded many to the clear commercial inequity in the delivery of it.

Yours Sincerely,

John Pugh


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