Last week’s announcement that the State broadcaster RTÉ reported a surplus of €7.9m for 2020 probably caught many within the wider media industry by surprise. Given that 2020 was a very challenging year for many industries, especially media, we have become used to hearing about annual losses. A surplus, however, is a rarity.
But 2020 was a year like no other and while RTÉ looks like it had a good pandemic, this headline surplus flatters to deceive. Indeed, this was Groundhog Day with a surprising twist because if one drills down further into the accounts and the notes that accompany them, it becomes clear that the true financial state of the broadcaster is troubling. Now that we are halfway through 2021, the finances of RTÉ have once again been described by Dee Forbes, the organisation’s director general, as “perilous”.
But we’ve been down this road before and there’s a familiar and depressing pattern to it all.
A quick analysis of RTÉ’s accounts shows it only reported a surplus on three other occasions over the last 10 years. In 2013 that surplus amounted to €658,000 while the following year it fell to €217,000. Fast forward to 2017 when it was raining money in Dublin 4 and the national broadcaster reported a whopping €42.09m surplus – the biggest in its history – after it booked a one-off profit of €69m on the sale of some land at its Donnybrook HQ. But then it was back to losses in 2018 and 2019.
Even allowing for these intermittent surpluses, RTÉ has clocked up losses of €89.5m over the last 10 years. Over the same period, commercial revenues – including €1.85bn from the licence fee – have amounted to €3.4bn with annual revenues fluctuating between €330m to €340m.
Even a trainee accountant with an abacus can spot that something is wrong with all of this and it is very clear that RTÉ is either living way beyond its means or that it is being financially stretched to fulfil certain public service obligations that, in 2021, no longer make any commercial sense. Or both.
Let’s be clear: RTÉ has a very important and valuable role to play in delivering public service broadcasting in Ireland and we must do everything to protect it and the other media organisations that play a public service role. But RTÉ also has to help itself.
In the rapidly shifting media landscape, however, all roads lead back to money and in the case of RTÉ how it intends to finance itself in the future. While the Future of Media Commission is expected to delve deep into the future of public service broadcasting and how it is funded when it publishes its long-awaited report later this year, it is already clear that the old dual funding model hasn’t worked.
To date, much of the debate has focused on the need for more money from the licence fee. While this carefully controlled narrative has its origins in Donnybrook, RTÉ needs to realise that it also has other options for raising cash, including selling some of the family silver.
Some of these options will not be palatable but they could include the sale of RTÉ 2FM radio, the sale of the RTÉ Guide. It could also include the sale of its network division which last year reported a healthy surplus of €8.5m. But most of all, RTÉ needs to move out of its Donnybrook campus and use the proceeds of a sale – which could amount to several hundred million euro – to invest in a new high-tech HQ somewhere within the M50 while using some of the money to future-proof its relevancy going forward.
There is no commercially compelling argument that says RTÉ has to be or needs to be based in D4 . The old days of public service broadcasters occupying prime real estate in major cities is a thing of the past.
In the UK, for example, huge chunks of the BBC have moved from London to Media City in Salford, with more operations set to move to Birmingham, Glasgow and Cardiff., Channel 4, meanwhile, has also upped sticks from London and moved to Leeds.
While much of this activity has been set against a backdrop of planned decentralisation, it has also been carried out with a view to saving money and, ultimately, raising it. In these straitened financial times, why should RTÉ think it is any different?
The NewsBrands Ireland Journalism Awards 2021, sponsored by the National Lottery, are now open for entry.
The awards – which is one of the highlights of the annual media calendar – celebrate the very best in Irish journalism and feature a total of 23 categories spanning all areas and disciplines.
This year’s panel of independent judges will be chaired by former editor Tim Vaughan. The closing date for entries is July 30.
Core has become the first Irish agency group to receive IAB Gold Standard certification for its media agencies Mediaworks, Starcom, Spark Foundry and Zenith. The Gold Standard has four main aims: to uphold brand safety, to tackle ad fraud, to improve the digital advertising experience and to help compliance with the GDPR and ePrivacy laws. Other media organisations, agencies and publishers, including Mediahuis Ireland, are currently working towards certification.
