Today’s discussion at the Westminster Media Forum event did not go into any detail on the issue of BBC market impact. The BBC confirmed its commitment to the proposals in the DCMS Green Paper for market impact assessment to be an integral part of the approval process for new services, and for the BBC to work with Ofcom to agree an appropriate methodology for market impact assessment. Market impact assessment will feature in the “public value test” that the BBC is currently developing.

However, the BBC’s response to the Green Paper disagrees with one plank of the Government’s proposals for the way in which market impact considerations would be taken into account during the next Charter. The BBC has serious concerns with the Green Paper’s proposal that Ofcom should undertake the market impact assessment for proposed new services. The BBC argues that Ofcom may have - or may at least be perceived to have - a conflict of interest in relation to the sectors it regulates. The BBC suggests that the assessment should be undertaken by an independent third party, who would be jointly commissioned by Ofcom and the BBC Trust.

The BBC does not elaborate on the nature of the conflict of interest it identifies. Even so, the BBC’s concern highlights the need to recognise that, were Ofcom to be assigned the task foreseen in the Green Paper, it would be undertaking market impact assessment in an advisory capacity, as an adviser to the BBC Trust. Ofcom’s work in this area would therefore be quite separate from, and of a very different nature to, its powers in relation to the BBC (e.g. its powers to enforce the Competition Act). Leaving aside the direct conflict of interest argument, the system envisaged for approving new BBC services seems unlikely to be effective if this distinction is not fully appreciated.