BBC U-turns on podcast ads plan

The BBC has dropped its plan to introduce ads into podcasts in the UK accessed via commercial streaming sites like Apple Podcasts and Spotify.

Advertising arm BBC Studios — which sells advertising against BBC TV and audio content in foreign markets — had for the past year been weighing the possibility of selling ads in the UK under such circumstances, subject to regulatory assessment.

However, The Media Leader understands that the proposal to do so has been scrapped from the BBC’s annual plan, due to be published early next week.

Had it gone through, the move would have marked the first time the BBC had commercialised podcasts in the UK.

A spokesperson for the BBC told The Media Leader: “We have listened to feedback and, having considered the options carefully, we have decided to rule out placing adverts around BBC licence fee-funded programmes on third-party podcast platforms in the UK.

“We will continue to support the audio sector and the wider market, investing in the best ideas and developing production capabilities across the UK.”

Matt Payton, CEO of audio industry trade body Radiocentre, expressed relief over the BBC’s decision.

“We welcome the BBC’s public confirmation that it will not be introducing ads on its podcasts on third-party platforms,” he said in a statement.

“This is clearly the right decision for audiences, as well as the many businesses investing in podcasts in the UK. The BBC receives significant funding from the licence fee to produce distinctive audio content and introducing advertising alongside this would be damaging and inappropriate.”

For the BBC, the U-turn comes even as the organisation continues to consider alternative funding arrangements to maintain its public-service remit. The licence fee, by which the BBC is primarily funded, was frozen for two years earlier this decade before rising from £159 in early 2024 to £174.50 this year.

While the Labour government has committed to upholding the licence fee arrangement until the end of the BBC’s current charter period in 2027, the organisation has warned of the need to shore up additional funding lest it be required to make further cuts to its services.

Industry backlash

Initial plans had been to roll out ads on select BBC podcast titles in late 2024 and early 2025. Under the plan, BBC audio accessed via BBC Sounds would have remained ad-free.

At the time the plan was revealed in March 2024, a BBC spokesperson had commented: “As many of our podcasts are available on commercial platforms like Apple and Spotify, where adverts are the norm, we look to carry them in some of our content to generate more revenue to support the BBC, licence fee payers, our suppliers and rights holders.”

The move was widely rebuked from leaders in the commercial audio and news industries, who argued that the introduction of ads would be in conflict with the BBC’s licence fee and severely undermine competition among commercial broadcasters.

News Media Association (NMA) CEO Owen Meredith called the plan “very alarming”, arguing that such an intervention would “profoundly distort competition, wreaking havoc on commercial players right across the media and advertising sector”.

BBC plan to commercialise podcasts ‘could be catastrophic’

In April, Radiocentre commissioned competition economists at Compass Lexecon to conduct a study on the impact of advertising on BBC radio and audio services and concluded that it “would be bad for everyone”.

By May, a coalition of 20 media businesses including Bauer, Global, Goalhanger, Channel 4, ITV, Radiocentre, Reach and Sky had penned an open letter warning of the “disastrous impact” the BBC’s plan to take on advertising would have.

Addressed to then culture secretary Lucy Frazer, the letter warned that the BBC “risks setting a dangerous precedent” that could usher in advertising across more BBC services, despite the fact that they are explicitly created not for commercial success but for the public interest.

The letter further warned that UK podcast producers, broadcasters and publishers would have a more challenging time generating “a reasonable return on investment” given the potentially distorted market.