History
The early days of broadcasting presented broadcasters with the problem of how to raise funding for their services. Some countries adopted the advertising model, but many others adopted a compulsory public subscription model, with the subscription coming in the form of a broadcast licence paid by households owning a radio set (and later, a TV set).
The UK was the first country to adopt the compulsory public subscription model with the licence fee money going to the BBC, which was formed on 1 January 1927 by Royal Charter to produce publicly funded programming yet remain independent from government, both managerially and financially. The licence was originally known as a radio licence.
With the arrival of television some countries created a separate additional television licence, while others simply increased the radio licence fee to cover the additional cost of TV broadcasting, changing the licence's name from "radio licence" to "TV licence" or "receiver licence". Today most countries fund public radio broadcasting from the same licence fee that is used for television, although a few still have separate radio licences, or apply a lower or no fee at all for consumers who only have a radio. Some countries also have different fees for users with colour or monochrome TV. Many give discounts, or charge no fee, for elderly and/or disabled consumers.
Faced with the problem of licence fee evasion, some countries choose to fund public broadcasters directly from taxation or via other less avoidable methods such as a co-payment with electricity billing. National public broadcasters in some countries also carry supplemental advertising.
The Council of Europe created the European Convention on Transfrontier Television in 1989 that regulates among other things advertising standards, time and the format of breaks, which also has an indirect effect on the usage of licensing. In 1993, this treaty entered into force when it achieved 7 ratifications including 5 member states. It has since been acceded to by 34 countries, as of 2010.
Read more about this topic: Television Licence
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