Why do ratings matter for the BBC?

A lot of the protest around the Outcasts cancellation I’ve read in the comments has been around the ratings question. As a public service broadcaster, why do ratings matter?

Put simply, ratings are a way of the BBC verifying that it is spending the license fee in the viewers’ interests. If it is committing a large spend to a TV programme, it needs to be sure that it is proportionate to the interest in the show. Bearing in mind that an hour of even a simple soap opera can cost in excess of £100k, and these, rightly or wrongly, receive millions and millions of viewers, the higher cost of creating a Sci-Fi drama series presumably proportionate support (although obviously it’s not as simple as “as many viewers as Eastenders” or it’d never get made). In addition, although this is a secondary concern, a highly rated programme can be a source of revenue for the BBC via BBC Worldwide (which made £1bn last year, pittance against the operating costs of the BBC but not too shabby).

There’s more on this question on Quora for interested people.

However, I think the BBC has ignored the long tail a bit with Outcasts. If you look at my exchange with an independent TV producer on Quora here you’ll see that iPlayer ratings do indeed count – independent production companies are remunerated in part on performance there – but it looks like the decision to cancel Outcasts was taken before iPlayer data came into play. This is presumably because the viewer numbers were far too low for a mid-week prime-time programme, irrespective of iPlayer views, but without access to the iPlayer viewer numbers its difficult to know if they’ve been properly thoughtful about this.

Incidentally, I wrote to both the BBC and show producers Kudos TV to put some commenter questions to them. Sadly, the BBC has ignored me (presumably because I am not a journalist) and Kudos sent me an ironic individual reply saying they wouldn’t reply to emails individually.