INSIGHT

How German-speaking PSM are facing fundamental reform

30 April 2025

Across German-speaking countries, there is a movement to fundamentally change public service media. Former head of international relations at ZDF, Dagmar Skopalik, analyses the situations in Austria and Germany.

ORF must make further Savings

What is clear in any case is, that the law amendment will leave the ORF with a large budget shortfall, as the household levy will be frozen until 2029. In January 2024, the previous “GIS fee” – or licence fee – was switched to the new model, according to which the fee is now payable per household and no longer depending on a radio or TV device. Although the new fee of €15.30 per month was around €3 less, the ÖVP, which was in government with the Greens at the time, linked it to the demand for significant savings measures. As a result, the ORF launched a savings programme of €325 million by 2026. As the current fee amount will now remain the same, i.e. not even adjusted to inflation, the dry spell on the revenue side will be extended for a further four years. The ORF budget plan for 2025 provides for €1,010 million revenues, €685 millions of which will come from the household levy.

ORF director general Roland Weißmann commented that the ORF’s financing is still secure but spoke of a difficult path that the broadcaster will have to take in the coming period. He forecast that a further €320 million would have to be saved by 2029, in terms of programming and personnel.

“The ORF is facing another very tough austerity package – but at the same time, the primary goal remains clear: the alliance with the audience must be further expanded even in economically difficult times so that the ORF remains the media service that Austria trusts the most in the future.” – R. Weißmann, dg ORF

Major ORF Reform in the Pipeline

The amendment to the law is only the prelude to an overall reform of the ORF. The government programme from February outlined what further reforms could involve. The goals of the reform include strengthening citizen participation and further developing the public service mandate, but above all creating ‘a leaner ORF with the best quality’. How it envisages this ORF in concrete terms the government intends to work out over the course of the legislative period.

Joint platform system of PSM

A joint streaming platform which would bundle all PSM content has been repeatedly discussed in the past. It has also been criticised just as often, especially for branding reasons. The broadcasters were afraid – and rightly so – that their offerings would no longer be recognisable as ZDF or ARD programmes. One look at big streaming platforms such as Netflix is enough to realise how difficult it is to design an abundance of offerings in such a way that users can find them. This would be even more true for the content of PSMs, as this goes far beyond fiction and entertainment.

With the state treaty reforms, such a PSM super media library is now off the table. Instead, there is a mandate to create a joint platform system on which not only the existing media libraries of ARD and ZDF can be operated. It should also be possible for third-parties to network their offerings with it – a platform system on an open-source basis and with freely accessible software. If this proves successful, a public service communication space could be the outcome. But there is still a long way to go.

At a panel discussion at the Media Conference Mitteldeutschland, PSM director generals recently stressed that ARD and ZDF have been working on this already. There, ZDF director general Norbert Himmler emphasised the advantages of an open and progressive platform system compared to Netflix, Amazon and Co. with their closed-shop systems, and invited others to join.

“Let’s go to such a platform together, in which we can all participate in terms of content and technology, but where everyone can keep their own area, their own brand. Then, we would also have a wide distribution among the population.” – N. Himmler, dg ZDF (Media Days Central Germany, 2 April 2025)

The problem with the similarity to the press

The issue of how much and what text PSMs are allowed to publish on their online services has been a media policy long-runner since the advent of online offerings, and has been brought before the court more than once. It is the print media sector, especially the newspapers publishers, who see their business model as threatened. They argue that the PSMs are too text-heavy in their online offerings thus leading to competitive distortion, disruption of the free press market and jeopardising the diversity of the press in Germany. After the requirements for the PSMs were temporarily somewhat relaxed, they are now being tightened again with the broadcasting treaty reform.

Now, what PSMs publish on their own portals or online services may no longer be “press-like” (presseähnlich). Only “broadcast-accompanying” (sendebegleitend) texts are permitted, and news headlines must include accompanying real-time reporting and factchecks.

The impact on the digital services of ARD and ZDF, which offer additional textual information to accompany news videos, for example, is likely to be considerable, quite apart from the additional workload of checking every textual publication to determine whether it is “broadcast-accompanying” or “press-like”. Quite a few critics think that these requirements are a throwback to the past. The internet is a cross-media medium per se and newspaper publishers are also present there, meanwhile, with text, video and audio content. In any case, you don’t have to be a clairvoyant to assume that this issue will continue to be a source of conflict.

What about the cost savings?

The minister presidents of the federal states also expect the broadcasters to make further savings, as quickly and as much as possible. However, this cannot realistically be expected in the short term, especially as organisational and technological changes also cause costs, initially.

When it comes to finances, broadcasters are currently concerned with their largest revenue item – the household levy. The independent finance commission KEF, which is responsible for determining its amount, had proposed increasing the household fee by €0.58 to €18.94 per month from January 2025. The prime ministers were unable to agree on this fee increase, with two state representatives rejecting it. However, unanimity is a prerequisite for the household fee to come into force. Instead, they decided to freeze the household fee for two years.

ARD and ZDF then decided to appeal to the Constitutional Court. Their concern is not the amount of the contribution. For them, it is the principle as Florian Hager, Chairman of ARD, emphasised once again in a recent interview:

“The procedure for setting the household fee is a political decision. Politics formulate our mandate, and we respect that. We also accept the financing model. The procedure for setting the licence fee was created to prevent political influence. This applies above all in the event that we ever find ourselves in times when political forces are involved in who potentially might want to abolish us completely. This procedure safeguards our independence from the state. We have taken legal action because we do not want this procedure to be damaged or weakened.” – F. Hager, epd medien 16.4.2025

It is not yet clear, when the ruling of the Federal Constitutional Court can be expected. Until then, ARD and ZDF will not only have to start implementing the new reform broadcasting treaty, but also continue to make savings.

The cases of Austria and Germany are not isolated exceptions, but part of a broader development. Although the media policy framework and financing models differ from country to country, PSM is under pressure everywhere, whether in Europe, Canada or Australia.

Competition, especially from internationally active and financially strong media giants such as Google, Amazon and Meta, and with them from social media, is becoming increasingly fierce. And politicians argue that in times of economic crisis and overall shrinking budgets, it is not reasonable to expect from citizens to pay higher contributions for PSM. At the same time, however, PSMs should continue to fulfil their mandate for society also in the future. But how this public value can be delivered in times of profound changes and financial constraints is a crucial challenge for PSM and asks for many questions yet to be answered.