British broadcaster Channel 4 has dropped all but one of its premium-rate phone-in competitions following the ‘You Say, We Pay’ phone-in fiasco. Over 40% of those that called premium rate lines to enter the prize competition on the channel between September 2004 and February 2007 had no chance of winning. The loss of premium rate services and refunds to viewers will cost the channel millions.

A recent review published by the national communications regulator Ofcom was scathing in its criticism of the operation of participation programmes by broadcasters. It concluded that “compliance failures were systemic” across the industry and that “some broadcasters appeared to be in denial about their responsibilities”.

Eckoh Technologies plc, the company that ran the phone line services for the “You Say, We Pay” competition on the Richard and Judy show on Channel 4, received a record fine of £150,000 from ICSTIS, the premium rate telephone services regulator.

Further fines and censures could still be forthcoming. The revelations of irregularities in the running of phone-in competitions have already claimed the resignation of the managing director of GMTV, the breakfast television franchise that is 75% owned by ITV plc.

Michael Grade, the executive chairman of the ITV company, has promised a zero tolerance “one strike and you’re out” approach to any producer that deceived viewers, warning them that they would never work for the network again. These are fine words that he could yet regret.

Mark Thompson, the director general of the BBC, issued a statement on 18 July announcing “a total suspension of all competitions” with immediate effect. Inexplicably, the publicly funded broadcaster appears to be continuing to invite viewers to call premium rate phone lines to vote in at least some of its shows.

Channel 4 has already pulled all text message voting from its programmes, including the current series of Big Brother. It says it could not obtain satisfactory guarantees on the dependability and delivery of text votes. The broadcaster says that phone votes will now be charged at a rate that covers the cost of the call plus any charitable donation.

Deal or No Deal
The weekday game show Deal or no deal will continue with its competition for contractual reasons, but any share of profits to the broadcaster will go to charity.

The notion of covering the cost of a call is an interesting one, in an age in which an inexpensive flat rate charge can often offer unlimited international calls. It seems that 25 pence, or 50 cents, can go a very long way — say Australia for an hour — which makes it seem pretty poor value for a drop call vote. That is the cost from a land line. Calls from other operators, notably mobile companies, may vary. If broadcasters are not making money from this, perhaps they should question who is.

The BBC likes to say that the television licence, which funds several television channels and any number of radio stations, costs less than 40 pence a day per household. One might therefore imagine that broadcasters could come up with a cheaper way of counting votes if all they want to do is encourage viewer participation, perhaps offering the internet as a free option.

The loss of competitions may sacrifice millions of pounds of profits to Channel 4, but it seems a small price to pay to distance itself from the disreputable business practices that have emerged over the last six months.

It is understood that premium rate telephone services added over £10 million to the bottom line of Channel 4 in the last full financial year, representing around half its profits. Then again, some might question whether it should be the public purpose of the channel to make profit from viewers in this way.

“As a commercially funded public service broadcaster we’ve previously taken the view that premium rate competitions were a legitimate activity given the demand from viewers to take part but public trust in these competitions has been severely undermined and we do not want to risk further our relationship with our viewers,” said Channel 4 group finance director Anne Bulford.

“The channel’s reputation is its most valuable asset and can only be protected by demonstrating that we place the highest priority on safeguarding the interests of our viewers and will take action if we find they have been let down.”

The move by Channel 4 to distance itself from further damage will put further pressure on senior executives at the BBC, which appears to be pressing on regardless of its own commitment to viewers to suspend all competitions.

The BBC is continuing to charge viewers 25 pence a vote on its prime time Saturday night dancing show DanceX, although it makes a contribution to a charity for each call.

Presumably they do not consider the format, in which teams compete to win and members are eliminated as a result of viewer votes, is really a competition. In which case, viewers might question the value of their votes and whether they really count. Then again, they can always phone to complain if they are concerned — for the price of a national call.