1 Introduction

Public Service Media (PSM), that is mainly “legacy” public broadcasting, of which the British Broadcasting Corporation (BBC) is the best-known example, are often established by law. They are non-partisan by design, independent from government and offer their services for the benefit of society at large.

Their legal remit is to inform, entertain, and educate the public who pay for them. But in doing so they must also protect their independence and ensure accountability. Their core mission is to serve the public interest.

There are plenty of examples around the world where governments are financially supporting media in the public interest—ideally without wielding editorial influence. Particularly in democratic countries, government intervention to preserve and promote “public value” dimensions of news and quality journalism is structurally formative.

In Europe, PSM are represented by the European Broadcasting Union (EBU). The world’s largest alliance counts 69 members in 56 countries in Europe and beyond (www.ebu.ch/about/members), most prominently the BBC (UK), ARD and ZDF (Germany), DR (Denmark), RAI (Italy), France Télévisions (France), YLE (Finland) in the field of TV broadcasting, but also a fleet of PSM radio stations, for example, Deutschlandradio (Germany), an ad-free PSM radio station from Germany.

However, across Europe and beyond, PSM are increasingly under pressure. Digitization and emergent technologies are changing the use of media rapidly, with streaming services and online platforms gaining in importance and making it harder for legacy PSM to hold their ground.

This means that supporting the role of trustworthy, anti-partisan quality news journalism and news media in a democratic society—primarily taking the form of license-fee funding for public service broadcasting but also direct grants and indirect support to private printed media incumbents—seems ever more important.

Austria is no exception. The Austrian Broadcasting Corporation (Österreichischer Rundfunk, ORF) is the country’s main PSM broadcaster (ORF, 2017a, 2017b, 2019, 2021). Even though private broadcasting companies were allowed only to enter the market in the late 1990s, the ORF has been offering its services since 1955 and up until today dominates broadcasting (and online) services provision in Austria.

It runs three nationwide (Ö1, Ö3, FM4) and nine regional radio channels—one for each province (Bundesland). Its TV portfolio includes two general interest channels (ORF 1 and ORF 2), one cultural-instructional channel (ORF III), one Eurovision-wide version of ORF 2 and a sports channel (ORF Sport +). ORF also takes part in the international special-interest channel 3sat.

This study examines public value theory and critically discusses its validity in explaining impacts on principles and remit of Public Service Media (PSM) in the digital era. The stakes are high as PSM such as the ORF need to both modernize and remain publicly responsible at the same time, for all audiences.

The purpose of this study is two-fold: First, it theorizes on the concept of “public value” and presents some dominant scholarly debates around the concept’s approaches to measurement and funding as applied to the media industry.

By this, it argues that it is rather unclear how the public value mission is economically valuable for PSM and more importantly how, if at all, public value might be socially beneficial for media audiences and society at large. Hence, we principally ask whether public value for PSM is as strong and valid a concept to generate and prove both economic value and societal welfare.

And second, we look at how Austria’s ORF, the country’s dominant media and key PSM player, is coping with the current transformation of public service broadcasting through means of its public value “TransFORM” project. This implies gaining more insights to the concept of public value in the media from various selected facets.

We argue that the traditional concept of “public value” as widely scholarly agreed in PSM research is likely to effectively contribute to mastering the fundamental challenges of PSM, that is mostly one of digitalization, accountability, and openness for all citizens in a given country.

In our view, the traditional public value concept is elusive in character. It has high face validity, but only narrowly based explication, little consensus on meaning, and only recently emerging empirical verification.

To be truly effective, public value for PSM needs to be defined both more broadly and narrowly at the same time. More broadly in mission and vision, and more narrowly in proven impact. Evidence-based performance measurement of PSM remains vitally important.

There, processes of digitization have stepped up competition in the programming, advertising, and viewer markets of broadcasting, which turn out to endanger the continued existence of public service broadcasting in Austria.

A case study analysis of Austria’s Public Service Broadcasting Corporation (ORF) thus reveals key challenges in delivering the promises of PSM’s contribution to society in this process of transformation.

Given above challenges to media organizations, this study attempts to answer the following four questions:

  • RQ1: What is public value in theory?

  • RQ2: How can public value be measured?

  • RQ3: How do public value concepts best relate to PSM?

  • RQ4: What funding models are most effective for PSM?

2 Public Value Theory

“Public value” is a young concept and combines a mix of economics and management theory. It was introduced by Harvard University Professor Mark Moore in 1995 with the aim of laying out “a structure of practical reasoning to guide managers of public enterprises. It presents a general answer to the question of what public managers should think and do to exploit the particular circumstances they find themselves in to create public value” (p. 1). Moore described the challenge as changing the approach of public administrators who conventionally saw their duty as simply being to follow efficiently and effectively the legislative-based mandates that set out the purposes of particular public enterprises and came to conclude that the goal of operational activity in the public sector is the creation of public value. However, Moore also admitted that public value cannot be “measured” in principle.

The British BBC was the first broadcaster to engage with this new public value doctrine (Collins, 2007). It drew up its own manifesto (BBC, 2004), which on the one hand justified the levying of fees, but on the other hand also provided for accountability to the fee payers: The services provided were to be assessed in terms of their public value.

The academic debate about the public value of broadcasting across all offerings and age groups is complex and quite confusing (Alford & O’Flynn, 2009; Benington & Moore, 2009; Gundlach, 2011; Karmasin et al., 2011; Talbot, 2009). This is mainly due to the hybrid intellectual architecture of public value, which leads to competing scientific discourses.

Three schools are fighting for academic hegemony: First, the beginning of public value research dates to 1995, with Mark H. Moore’s seminal book Creating Public Value: Strategic Management in Government (1995). Then, Moore presented the public value concept as a normative theory of strategic management in the public sector and saw it as the equivalent of shareholder value in the management of private companies. Social value creation has since become a corporate duty.

In contrast to Moore’s management perspective, Barry Bozeman’s work is concerned with the societal level (Bryson et al., 2015). This is reflected in Bozeman’s definition of public values as “those that provide a normative consensus about the rights, benefits and privileges to which citizens should (and should not) be entitled; the duties of citizens to society, the state and each other; and the principles on which governments and policies should be based” (Bozeman, 2007, p. 17).

Unlike Moore’s (1995) and Bozeman’s (2007, 2009) approaches to public value, Meynhardt (2015, 2019) offers a basis for a more refined conception of value. Not only does he anchor public value in a relational approach to value and embed it in an ontological basis in basic human needs, but he also relates it to a notion of the public rooted in individuals’ representations and interpretations. Simply put, public value reflects basic human needs, and basic needs form the foundation for public value.

In essence, the academic debate about public value creation of the media is complex. It raises questions about the value of media content and the quality of services offered, particularly regarding the values to be conveyed for society. Further, it intrigues about PSM’s legal obligation to produce societally relevant content, distribute over diverse platforms and channels, and accepted and consumed by heterogeneous audiences (Dobusch, 2018).

A recent study by Faulkner and Kaufman (2018) highlighted the different dimensions of Public Value measurement through an accurate and systematic analysis of the literature. Through a qualitative synthesis of the topics analyzed in the literature, the authors identified four analytical themes of public value measurement: (1) “outcome achievement”; (2) “trust and legitimacy”; (3) “service delivery quality”; and (4) “efficiency.” These themes represent four key constructs that the reviewed studies suggest are important dimensions of public value measurement.

Ad (1) Outcome achievement: An outcome would be, for example, a social economic, ecological, or cultural outcome that is perceived as an improvement of the public sector, such as increased security and good medical care. Bozeman and colleagues (2015) mentioned several such outcomes, including national security, food safety, human health, environmental protection; and access to knowledge. Benington (2009, 2011) similarly suggests that benefits to economic activity and employment, social capital and cohesion, and environmental outcomes (e.g., reducing pollution, waste, and global warming) could be considered as aspects of public value. Similarly, several authors note that public value can be indicated by improvements in social outcomes (Brookes & Wiggan, 2009; Talbot & Wiggan, 2010; Meynhardt & Bartholomes, 2011; Conolly, 2013; Bracci et al., 2014; Spano, 2014; Moore, 2013). When referred to the media industry, quality media may achieve such outcome through the so-called positive externalities in the consumption of, for example, regional news, cultural programs, or the broadcasting of parliamentary debates.

Ad (2) Trust and Legitimacy refers to the extent to which an organization and its activities are trusted and perceived to be legitimate by the public and by key stakeholders. This dimension includes the extent to which the public trust the particular institution (Talbot & Wiggan, 2010), trust the programs or services delivered by institution (Heeks, 2008), and perceive an institution to be delivering services transparently and fairly (Meynhardt & Bartholomes, 2011). Talbot and Wiggan (2010) argue that trust and legitimacy are the heart of public value creation, largely because organizations that are trusted and perceived to be legitimate are best able to secure the support needed to carry out their objectives.

Ad (3) Quality of the service refers to the extent to which services are experienced as being delivered in high-quality manner that is considerate of users’ needs. It is expected to be maximized when individuals who interact with the service are satisfied, and when they perceive the services to be responsive to their needs, accessible, convenient, and incorporate sufficient citizen engagement (Benington, 2009, 2011; Spano, 2014). Although no studies explicitly developed or validated quantitative measures of service delivery quality, at least two studies provided suggestions that may be useful for developing such a measure. Meynhardt and Bartholmes’ (2011) measure of public value included items related to perceived service quality, customer satisfaction, and responsiveness to feedback.

Ad (4) Efficiency refers to the extent to which an organization is achieving maximal benefits with minimal resources. It is expected to be high when the benefits provided by an organization are perceived to outweigh the costs of that organization (Talbot & Wiggan, 2010), when “unnecessary” bureaucracy is avoided (Meynhardt & Bartholomes, 2011), and when an organization is perceived to offer “value for money” (Collins, 2007; Talbot & Wiggan, 2010).

By and large, it is crucial that an organization’s value contribution to society is also experienced and accepted by individual recipients. For PSM, such acceptance is signaled, for example, by a license fee payers’ willingness to pay. We posit here that only through individual recipients’ appreciation through paid-for consumption does social acceptance for the collective good of public service broadcasting arise. The UK’s Work Foundation describes the process of individual appreciation as follows: “Public value is what the public values, and it is the role of public managers to help determine through the democratic processes of deliberation and public engagement what social outcomes are desirable. It is through such processes that public managers can help to articulate collective citizens’ preferences and thereby redress the ‘democratic deficit’ between public services and citizens” (Horner et al., 2006, p. 7).

For public value not become an empty formula, a central problem thus must be solved: What counts as public value is not only a problem of definition and agreement upon particular interest groups in society in the sense that public organizations automatically create public value as a matter of their remit, but, more essentially, predominantly a problem of measurement and proven evidence in public value performance (Hills & Sullivan, 2006). When applied to media organizations—a topic which we tackle in more detail below—consumers of public value programs may derive benefits from PSM programs and services only if these become a proven and real value that satisfies their preferences.

If this individual media benefit is not generated, no willingness to pay and hence no social value is generated, and thus ultimately no public sphere created. In the media economy, individual consumer preferences determine the benefit of a market offering.

Both PSM and private commercial media have to manage this major challenge in meeting the mission of a public value organization in times of transformational competition.

3 Public Value Measurement

We are living through a period of immense disruption in the media industry. The creation of the internet and social media and all that it has wrought—networked interactivity, immediacy, and fragmented audiences—has set in motion the destruction of the old business models that supported traditional media companies in the past such as broadcast TV, commercial radio, and newspapers. And, worse yet, the industry is experiencing an economic crisis and “legacy” media see a painful and ongoing decline in revenues as paid display ads, subscriptions, and direct sales shrink, while costs are still on the rise.

PSM are greatly challenged too. They need to deliver more and better services despite unchanging or diminishing public resources and support. But how can public accountability and public value best be measured?

Traditionally, at its 2012 General Assembly, members of the European Broadcasting Union (EBU) from Europe and beyond unanimously adopted six key values which define why public service media (PSM) are indispensable in true democratic societies (EBU, 2012).

The following traditionally acclaimed core PSM values are also well resonated and agreed-upon as seminal within scholarly PSM research (Eberwein et al., 2019; Van den Bulck, 2015).

  • Accountability (i.e., discourse with the audience, transparency to the outside world, fulfillment, and control of the public service)

  • Diversity (i.e., pluralism regarding program genres, views, and staff)

  • Excellence (i.e., professionality and high-quality standards to meet audience expectations)

  • Independence (i.e., non-partisan services and content delivery independent of political, commercial, and other influences, committed only to the interests of the public, committed to democracy)

  • Innovation (i.e., intensive promotion of new formats, new technologies, and new ways to connect with the audience)

  • Universality (i.e., the creation of a forum for all members of the society, unrestricted access for all on all technical platforms)

Certainly, these core values must be operationalized and measured to become evident and real. To do this, key figures of PSM as value-driven media organizations must first be identified, which are then combined in a meaningful way in a so-called Public Value Scorecard (PVSC) model. PVSC can provide a valuable decision-making tool for the management of PSM (Cobbold et al., 2004).

In fact, the European Broadcasting Union (EBU) and the German ARD—among others—have developed scorecard frameworks to evaluate the social value of public service broadcasting (EBU, 2017, 2020a).

Besides the problems in properly and successfully managing industry change (e.g., of digitalization and globalization), all above-mentioned organizations produce contents that are not ordinary commercial goods but goods with a social impact. For example, when media companies provide information about public health, it can affect the way people think or behave; therefore, media managers must take into consideration their social power of shaping people’s opinions and beliefs.

The core element of the PVSC model is its cause and effect logic. The PVSC links corporate strategy (Input) with the customer view (Output), this with the process logic (Process) and finally society level (Outcome). The public value of PSM is thus multi-dimensional. As such, it can thus become subject to testing various hypotheses based on relations between the variables involved.

For example, a recent study by the Austrian Academy of Sciences has raised the questions as to whether government financing of public service media would directly influence audience success. Hence, “broadcasters with higher public funding achieve higher market shares, greater relevance as a trustful source of information and higher levels of trust in independence from external influences” (Eberwein et al., 2019, p. 143).

Consequently, government-funded media would achieve higher levels of trust and acceptance by the public, and hence achieve higher chances to contribute to influencing public opinion and shape public discourse. However, this may backfire in a sense that government funding may capture the media through controlling media by not financing independent journalism but choosing to fund instead media outlets that advance the government agenda and the interests of its allies and supporters, either political groups or businesses.

The University of St. Gallen in Switzerland has developed a “Public Value Scorecard” (PVSC) to help organizations understand and increase their value to society. The questions raised by this model are: What value are large organizations bringing to society? And, when they are getting it right, how can and should corporations build trust and gain legitimacy within society?

Meynhardt et al. (2009, 2015, 2019) PVC model focuses directly on public value creation along five theory-based basic public value dimensions. These are:

  • Task fulfillment: Does the organization fulfill its core task or “is it useful?”

  • Economic viability: Does the organization use economic resources efficiently or “is it profitable?”

  • Morality: Does the organization behave decently or “is it decent?”

  • Quality of life: Does the organization contribute to quality of life or “is it a positive experience?”

  • Social cohesion: Does the organization contribute to the common good or “is it welfare-enhancing?”

Meynhardt (2009) roots the notion of value in psychological needs theory. Seen this way, public value must primarily be measured subjectively, as an individual’s perception of various beliefs, attitudes, values, sentiments, and feelings when consuming a specific PSM’s service.

Value measurement must thus be linked to individuals’ perceptions of, for instance, (1) the basic need for orientation and control, (2) the basic need for self-esteem maintenance and self-esteem enhancement, (3) the basic need for positive social relationships, and (4) the basic need for pleasure gain and displeasure avoidance (when following Seymour Epstein’s Cognitive-experiential self-theory (2003) (Table 1).

Table 1 The Public Value Scorecard (PVSC): Public value dimension, Objectives (general), and Objectives (PSM-related)
Full size table

4 Austria’s ORF: A Case Study Analysis

When looking to media more particularly, PSM value can no longer be measured solely based on traditional headline performance metrics successes such as audience share and reach.

Instead, today’s PSM performance measurement needs to be based on alternative quality-based measures, e.g., audience satisfaction and approval ratings, or “value for money” measures. The World Economic Forum’s latest report (2020) has put it as follows: “Media don’t just help pass the time; they keep people informed. Increasingly, media create shared cultural moments and capture identity. We need a more dynamic measure to calculate the real value of media to society.” (WEF, 2020). In gist, PSM need to rethink performance metrics and how public values may be viewed by the public and its members.

More recent studies emphasize the wider implications of public value creation in public media. Over the summer of 2020, against the backdrop of the COVID pandemic, Mazzucato et al. (2020) developed new metrics that can assess how the BBC delivers against its mission, creates public value, and co-shapes markets. In their report Creating and Measuring Dynamic Public Value at the BBC, the authors tackled questions of how to measure the BBC’s public value more dynamically and holistically. By widening the picture beyond mere audience reach numbers, it identified three layers of public value in that the BBC creates broader value for individuals, industry, and society at large. In doing so it has created value for individuals in their experiences as consumers; for society in contributing to a more inclusive, tolerant, and diverse culture; and in industry in taking the kinds of risks necessary for new markets to emerge.

As proven, audience share and reach remain important. “Consumption figures help to show the BBC’s reach, efficiency, and commercial success—these are key indicators of public value as without successful and widely viewed programming, the BBC would not have the legitimacy and scale to engage the wider public. But by widening the picture beyond numbers, we can see that the BBC creates broader value for individuals, industry, and society” (Mazzucato et al., 2020, p. 23; see also, Mazzucato, & Semieniuk, 2017; Mazzucato, 2016).

Further studies identified even a wider range of additional dimensions of public values that can be applied by PSM (Horner et al., 2006), such as public satisfaction, economic value (creation of economic activity/employment), social and cultural value (social capital/cohesion), political value (democratic dialogue, public participation), ecological value (sustainable development), service quality (reception, satisfaction, choice, fairness, cost), financial performance (income, expenditure value for money, efficiency), non-financial performance (customer satisfaction, service quality), social value from the user’s perspective (tangible economic value from the administration’s perspective, intangible economic value from the administration’s perspective), trust and legitimacy, and the protection of civil rights. Importantly, according to Mazzucato et al. (2020), there is a more basic need to return to an understanding of the state as a collective value creator, and not limit its role to stabilizing markets in crisis. By acting as investor, inventor, innovator, and consumer platform at the same time, the BBC would play an essential role in developing the UK’s infrastructure for digital media innovation.

In what follows, we look to Austria as a best-practice case study to apply some selected issues of public value theory to the field of public service media. By using case study analysis technique, we show how the concept of Public Value is practically applied by Austria’s PSM ORF. We start with the well-known proposition that public value creation and delivery is the very legitimacy of PSM. Of course, Austria is no exception. There, however, the public value debate was developing only late but finally gradually took hold.

In 2010, it resulted in some changes to the ORF Act (ORF-G). Since then, the Österreichischer Rundfunk (“Austrian Broadcasting Corporation,” ORF)—the country’s national public service broadcaster—has been cultivating a well-organized public value culture, business modeling, and reporting, based on its legal remit.

The central public value provision of the law is the so-called public service core remit, according to which an overall balanced program must contain demanding content on an equal footing. The annual and monthly schedules of television are to be drawn up in such a way that the ORF is obliged to broadcast demanding programs, at least in the main prime-time programs (from 8 to 10 p.m.).

The Act also states that the ORF needs to pay attention to the distinctiveness of the ORF in terms of content and appearance vis-à-vis commercial broadcasters. In addition, program and services quality must be cross-checked on an ongoing basis. Further, its broadcasts and services in the fields of information, culture, and science must be characterized by high quality.

4.1 Public Value Remit

The ORF is an independent PSM and defined as a foundation under public law. By its legal remit alone, it is committed to create public value. The ORF channels offer an extensive set of cross-genres programs in information, science, culture, sports, entertainment, as well as religion.

Every day, 49% of Austrians are watching ORF TV programs (3.7 million viewers) and these numbers rise to a weekly reach of 74.4% (5.6 million viewers). In 2018, the two main TV channels (ORF 1 and ORF 2) together reached 29.8% market share (people older than 3 years), which is the 8th highest figure among all public service media providers in Europe. The entire ORF television-fleet (also including ORF III and ORF Sport+) achieved a market share of 31.8% in 2019.

And, compared to commercial broadcasters, attention is paid to the distinctiveness of the ORF in content and services offerings.

Being a foundation under public law, it needs to fulfill several duties and mandates laid down in the ORF Act.

This includes investing all its revenues, i.e., radio and TV license fees (50%) and advertising and other revenues (50%), into its programs and services for its audiences.

Consequently, this is how it aims to fulfill its cultural and democratic functions. It provides Austrians with information, education, and entertainment, can influence the democratic polity, and ignites public discourse among various societally worthy topics that create a broader diversity of views, attitudes, and opinions among its audience.

But all this does not happen in vain. One current issue is whether the ORF will successfully master its transformation process from a public service broadcaster to a public service media platform. Back in 2020, ORF Director-General Alexander Wrabetz already presented “12 Theses on Austria as a Media Location.” These were intended to “set out the framework conditions for a future-proof further development of Austria as a media location for the benefit of the audience.” By this, he attempted nothing less than to envision future (survival) strategies of public service broadcasting in times of radical media change.

The core idea is: “For the future of Europe and European societies, maintaining an independent, diverse, transparent and sustainably viable media ecosystem is of central importance” (thesis 1), which is why “a strong ORF is indispensable for a strong Austrian media location” (thesis 6). The question is merely what definition of “strong” is appropriate in that context.

A solidarity is needed above all against the “dominance of German media groups in television,” the “superiority of global players in the online sector” and “globally operating pay groups.” The Director-General set the goal as follows: “The common goal of Austrian media companies must be to keep as much advertising money and added value as possible for the financing and production of media content in Austria,” said Wrabetz (thesis 4), ignoring the political concept of a European Single Market.

The fact that the ORF chooses a problem-oriented approach to seek common solutions for the complex challenges ahead is good and right, even if in the same breath the ORF then immediately follows up and demands “digital development freedom in the sense of the audience” (thesis 8), i.e., finally wants to take its fate into its own hands.

To sum it up, ORF programs of public value should not only comply with the legal mandate but should more particularly trigger sentiments with the audience that its core values reflect to strengthen the Austrian society as such.

Here, it is worth recalling the ethos of PSM: “The value of a public service medium is demonstrated by the quality and diversity of the public space they create and shape with other important actors in society. A space where everyone can meet with everyone, where people can inform themselves, discuss, relax, enjoy, educate, sometimes argue, create ideas, listen. A space that basically everyone can help shape.” (Ingrid Deltenre, 2012).

4.2 Public Value Reporting

Since 2015, the ORF publishes its own annual “Public Value Report,” that is a performance and benefit balance to represent ORF activities and services (see ORF Public Value—Start).

Since then, five value dimensions (“individual,” “social,” “national,” “international,” and “corporate” value) and 18 performance categories keep record of ORF’s media value, performance, and ensuing benefits for its audiences. The dimensions and categories are based on the ORF Act, ORF regulations, and the ORF code of conduct.

Each year’s ORF Public Value Report typically focuses on one specific key issue, for example, “Opening Up” in 2015/6, a title to indicate ORF’s and its employees’ ambitions to reflect on citizen participation, quality journalism, and content and technology innovations in times when more open relationships between PSM and audiences were becoming ever more important.

The ORF’s Director-General is responsible for the creation of this quality assurance system. The ORF Foundation Council (Stiftungsrat), which is politically staffed and votes in secret, must approve of it. The review of whether the quality criteria have been met is then to be carried out by an expert. This expert is also appointed by the Director-General with the approval of the Foundation Council.

The latest ORF Public Value Report 2021 (“TransFORM”) deals with “101 Questions on the Digital Future of the ORF”, based on the five quality dimensions: “Digital Me,” “Digital Us,” “Digital Local,” “Digital Global,” “Digital Platform”. Data are enriched with reports by ORF employees, media experts and scientists on the topic of digital transformation.

Indeed, the big question is to safeguard the future viability of Austria’s largest media provider. Disruptive developments in communication technologies have led to massive changes in media production and media use and have disrupted the media market in the hotly contested terrains of television, streaming, social media, and the internet. The ORF has received strong competition, while trust, especially of younger people, has faded.

In 2021, the ORF started the “TransFORM” process, a new change process initiated by the Public Value Department of the ORF. Building on prior research and analyses of challenges of the digital transformation on public value and the role of the PSM in the digital era (see, ORF Public Value), “TransFORM” is to:

  • Analyze concrete opportunities of change by commissioning an international study

  • Undertake the biggest survey ever on expectations of under 16- and 29-year-olds and their perceptions about the role of the ORF in times of change

  • Invite experts and innovators to discuss the challenges in public (“ORF-DialogForum”) to elicit a response and further dialogue on the change plans

Principally, with “TransFORM,” the public broadcaster ORF seems to walk down the right path. It critically opens the debate over what constitutes public value for PSM in Austria in times of fundamental change.

“TransFORM” identified five quality dimensions and 18 performance categories which keep record of ORF’s media performance, value, and benefits for the audience.

  • Individual Value: ORF establishes a trustfulFootnote 1 fundamental understanding of the world through extensive and factual accurate information. ORF service programs disseminate knowledge and support for numerous everyday life questions. ORF provides quality entertainment which means a versatile offer and quality standards, which consider requirements and high standard boundaries without advertising breaks. ORF takes responsibility and supports a direction toward common welfare

  • Social value: ORF’s cultural duty is to connect majorities with minorities. ORF news coverage offers orientation and support to understand the overwhelming news offer of the complex world. The foundation to this is to acknowledge the diversity of society. By providing the society a public platform close to the society’s interests, demands, and worries, ORF can build strong and close relationships with the public, which is of great importance to ORF. Additionally, ORF has an integration purpose. ORF connects and brings people together regardless how diverse they might be

  • National value: ORF regional coverage signifies living federalism. Encouraging the Austrian culture and creativity generates appreciation. ORF supports the discourse of Austrian identity with historic documentaries and initiatives

  • International value: ORF anticipates itself as the bridge between the World, Europe, and Austria. Amongst other components this is achieved through the support of the biggest Austrian correspondent network and the assistance of European broadcasters and media networks

  • Corporate value: Transparency and confirmability of the company as well as constant progressions of the employee’s expertise are necessity to ORF. Through quality assurance ORF may implement what the audience demands: the capability of innovation in radio, TV and online

In any case, skepticism about meeting these value goals and principles prevails. Today, PSM are facing highly turbulent environments. The streaming services of YouTube, Netflix, and Amazon Prime are clearly ahead of linear television among young audiences.

Nevertheless, only with more intelligence, interaction and convergent infrastructures will the ORF succeed as a powerful PSM and become a powerful player in the “platform society” (Van Dijck et al., 2018). Why? Because ORF’s claim to hegemony is crumbling in the convergent media world. There, innovation, variety, fragmentation, and diversity are structural principles. In short: The relevance of the journalistic competition in shaping public opinion is increasing regarding reach, displacement through other media, journalistic and political relevance, moving images and topicality. This weakens the ORF.

Consequently, it is necessary to rethink the role of PSM in a more fragmented society. On the one hand, this involves refining the societal contribution of public service. Starting from the notion that PSM should, as McQuail (2010, p. 178) put it, “serve the public interest by meeting the important communication needs of society and its citizens,” these needs (e.g., contribution to democratic governance and culture, production of information and knowledge, cohesion and integration, or progress) and the ways PSM can address these needs in unique ways other media cannot have to be identified. On the other hand, it is also necessary to modernize the ways in which PSM provide their contribution to society. Beyond producing content for all kinds of distribution channels, platforms, and usage scenarios (ranging from the living room to mobile consumption), PSM have the chance to involve citizens in production and to evolve the ways in which their content reaches audiences (e.g., personalization-based services). Furthermore, it is necessary to discuss how the contribution of PSM to society can be measured.

5 Public Value Financing

Certainly, change implies risks and uncertainty. Hence, to safeguard funding sustainability for PSM remains pivotal.

Financial security is an essential building block for safeguarding PSM offerings. More strongly, for PSM to operate effectively, sound political, legal, and economic framework conditions are primarily important. This safeguards journalists to operate without interference or fear of violence, and PSM enjoy stable legal and business conditions that pay decent salaries, discourage media corruption, and promote sector-wide integrity.

However, and more generally, the PSM’s legitimacy has come into question as its share of television consumption has markedly declined in the digital era.

Stressing the role and importance of public value offerings such as through EBU’s public value projects is one way to mitigate this pressure on the license fee.

Another one is the Public Value Test (PVT) which typically assures that legal public value obligations are properly met, and the fees are closely tied back to the production and dissemination of high-quality content in the public interest (Donders & Moe, 2011).

Scholarly research has proven that a PVT is a solid and thorough evidence-based process which considers both the public value and market impact of proposals (Knoll, 2012).

For example, when PSM introduce new programs, shows, or technologies (such as the BBC’s catch-up TV service of the iPlayer in the UK), the new (or innovative) offering is not only firmly tested against producing added value for the public, but also the damage existing commercial providers may suffer from seeing their number of audiences and therefore possibly advertising income reduced. To legitimate the introduction of these new services (or innovations of traditional ones), the BBC Trust—the governing body of the BBC between 2007 and 2017—had consulted license fee payers to ensure its decisions are properly informed by those who pay for the BBC.

While this process has proven a valid means to safeguard public accountability, three critical issues are unresolved (Meynhardt & Frantz, 2019; Murschetz, 2021a, b):

Firstly, as has long been argued by the commercial media sector, PSM occupies a privileged funding position that gives public media an unfair competitive advantage. To ensure that PSM are both accountable and transparent, many governments now insist on substantial reporting and monitoring of their activities, especially their financial dealings. Yet, such accountability is rarely shared and promoted to the public in a way that could build and maintain trust and credibility (PMA, 2019).

Secondly, while license fees remain by far the main source of funding for PSM in many countries across Europe and beyond (EBU, 2020b), discussion about the efficacy and governance of the model are back on the policy front burner (Puppis & Van den Bulck, 2018; Schweizer & Puppis, 2018).

Doubts on fee legitimacy and efficacy can be summarized as follows. Scholars (Puppis & Van den Bulck, 2018; Schweizer, 2020) suggest to:

  • Transform the fee into a household charge (such as in Germany and Switzerland), replacing it with a specific fund ringfenced outside the state budget and financed by a PSM special tax (such as in Finland and Sweden), or simply replacing it with transfers from the state budget (as in North Macedonia, Norway and Romania) (EBU, 2020b)

  • Change the methods for organizing fee collection, whereby the most widespread collection agencies are electricity suppliers and PSM themselves. Other possibilities witnessed are tax authorities, postal agencies, or private companies

  • Directly correlating the fee volume with performance metrics (other than share and reach, but more quality-based PV indicators; see above).

Interestingly, the paradigm that PSM need to be financed through license fees still dominates academic discourses. Such a model, it is believed, would be the most appropriate, legitimate, and effective. However, the dominance of the license fee funding model needs to be more fundamentally reviewed, if not broken. The deficits of the model seem to outweigh its benefits (Fukumoto & Bozeman, 2019; Gransow, 2020; Kelly et al., 2002; Serong, 2017).

Given the situation in Austria, there is reason to claim that the fee model is outdated. While most European countries with a fee have moved away from the traditional criteria of radio/TV reception-devices ownership, Austria still firmly sticks to it. More so, in Austria the fee is also covering devices including a tuner, which remains a rather restricted definition of a reception device.

Thirdly, it appears that the level of the ORF’s license fee is too high compared to the overall volume of public value content offered. In Austria, it needs a much stricter definition of what is public value media programming and what is not.

Principally, Para 31c of the ORF Act states that the funds received by ORF from the license fee may not be used in a manner which distorts competition which is not necessary for the fulfillment of the public service remit.

This includes the acquisition of broadcasting rights at excessive prices that are not justified according to commercial principles or the awarding of commercial communications at low prices, which only serve to increase the market share on the advertising market at the expense of competitors.

And fourthly, PSM must be able to work with stable multi-year budgets. However, the resulting social costs must be wisely balanced against the benefits of PSM offerings in the public interest. The PSM’s budget, in turn, needed to be adjusted according to key measures alongside an evidence-based public value scorecard model. Multi-year budgeting is important and hence needs to be controlled by an independent regulator.

6 Conclusion

To conclude, this study has critically discussed public value theory and its applicability to Public Service Media (PSM) in the digital era. It asked whether PSM validly and evidently generate both economic value and societal welfare.

Given above results, three conclusions can be drawn:

Firstly, a clear definition of PSM’s contribution to the public interest in the digital age is to refer to the central principles of public television, the public remit for full-service provision. Public service television is legally obliged to achieve geographic, program, and audience universality whereby it has something at some time to offer to everyone for the viewing nation as a whole. However, this means that public broadcasters are forced into an almost impossible balancing act: to survive they need to produce both distinctive niche products which the rest of the marketplace does not provide (including minority programming) and cater for a wide range of tastes and interests to justify the value of public funding. Therefore, viewer-financed public television must offer people something which they cannot otherwise see, serve minorities as well as fulfill the function of a national culture-identity carrier for majorities.

As a corollary, we doubt that the traditional concept of public value as widely scholarly agreed in PSM research is likely to effectively master the fundamental challenges of PSM. While accountability, diversity, excellence, independence, innovation, and universality are high-level objectives of PSM which are all legitimate, they are still rather elusive in character. They have high face validity, but only narrowly based explication, little consensus on meaning, and only recently emerging empirical verification. As for the future, we argue that to be truly effective, public value for PSM needs to be defined more broadly and narrowly at the same time. More broadly in mission and vision, and more narrowly in proven impact for society.

Secondly, PSM public value performance measurement is tricky and hard to come by. Therefore, benchmarking tools, vision and mission statement evaluations, input/output analyses, balanced scorecard techniques, cost–benefit analyses, and corporate social responsibility techniques need to be applied. Evidently, traditional reach and efficiency indicators alone will never grasp the scope and richness of PSM value to society. As argued and discussed above, a set of well-chosen criteria is needed to measure PSM performance adequately. Public value scorecard models, such as Meynhardt’s presented here, are promising toolboxes for evaluating public value impacts of PSM.

Thirdly, we believe that PSM performance must be measured against well-chosen criteria. For the future, public value scorecard models, such as Meynhardt’s PVSC presented above, are perfect toolboxes for evaluating public value impacts of PSM in times of the digital transformation (Meynhardt et al., 2017). Reviewing other frameworks—such as the BBC’s RQIV (Reach, Quality, Impact, and Value for money) framework—elicit further valuable insights when evaluating the performance of PSM monitored against defined “drivers” of public value. Ultimately, it remains to be seen whether the ORF will succeed in transforming the country’s media flagship to a real public value media platform. Evidently, it is not the only guarantor for the production and dissemination of public interest media communication in Austria. Other media also shape and create the public sphere in the Alpine republic, above all quality newspapers and non-commercial citizen media. Leading the ORF through the demanding and challenging transformation to remain a well-accepted and solidly valued PSM will depend on which public value criteria are chosen and balanced against value-driven performance indicators (Karmasin & Bichler, 2017).