Gov't OKs for new digital TV, radio services

LONDON — The BBC is plotting to protect its empire in the digital age by invading territory already occupied by its commercial rivals.

The U.K. government is expected to give a qualified greenlight to the pubcaster’s plans to launch a raft of new digital TV and radio services.

Unsurprisingly, commercial players such as the Disney Channel, Nickelodeon and Artsworld are up in arms.

But for the BBC, this expansion is an act of self-preservation, the only way to defend its position at the heart of British culture as the old reality of a unified national audience fractures into hundreds of digital niches.

At the center of the BBC’s digital strategy is a bouquet of four new TV channels — a youth-oriented BBC3, an artsy BBC4 and two daytime kids services.

The BBC has set aside £300 million ($420 million) over two years for the move, considerably more than its digital competitors could possibly spend.

“What you’ve got is a tax-funded state entity entering what is already a well-served market,” says David Hulbert, prexy of Walt Disney Television Intl.

Certainly those niche players have cause to worry: Some of the 14 existing channels that cater to the toddler-to-teen demographic are close to the brink, and losing viewers to the better-funded BBC could push them over the edge.

But the BBC argues that its plans will improve the quality of digital TV and so drive take-up.

Britain may have the highest digital penetration in the world (44%), but more than half the country has yet to be seduced by multichannel TV’s current skew toward soccer, movies and U.S. kidvid.

“We’re in a competition for creativity, we’re not competing for advertising or subscriptions,” says Roly Keating, the BBC’s controller of digital channels. “And what digital allows us to do is serve certain sections of the audience in a much deeper and more focused way.”

Some critics say the BBC should spend its money on improving its existing webs, BBC1 and BBC2. Others say the BBC should concentrate its digital efforts on audiences the commercial sector is ignoring, such as senior citizens.

But the BBC’s choice of targets is designed to protect its constituency in the long term.

Kids in multichannel homes are the pubcaster’s lightest viewers. But by launching BBC3 and the kids channels the BBC is hoping the next generation of Brits will not grow up thinking of the BBC as something only Mum and Dad like to watch.

By contrast, BBC4 — with a lineup of opera, foreign pics and docs — is aimed at those Brits who enjoy highbrow pursuits. It’s an elite aud but one that is disproportionately influential in garnering political support for the BBC’s publicly funded existence.

“A BBC restricted to just two branded TV channels in a universe of hundreds will lose prominence and relevance and cease to justify its claims on the public purse,” Michael Jackson, chief exec of fellow pubcaster Channel 4, wrote in a recent article. “A good thing, perhaps, for the shareholders of its competitors, but not for anyone who believes that public service broadcasting will prove of even greater worth in an increasingly fragmented digital marketplace.”

But he would say that, wouldn’t he? The BBC is only following the lead of C4, which already has extended its own empire into digital with its E4 and FilmFour channels.

With their big budgets and protected status, the pubcasters are emerging as among the most innovative players in the costly and risky digital universe.

Meanwhile, satcaster BSkyB has not shouted as loudly as the smaller digital programmers. As the U.K.’s dominant digital force, BSkyB stands to benefit if the BBC does bring more viewers to digital.

BSkyB is too big to be threatened. But the question is whether the British public will be better served by allowing the old guard to extend their hegemony into the digital sector or by liberating the market for new players to emerge. That is what the government will have to decide.

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