Grade: BBC should share income

Ex-topper at BBC, C4, ITV calls for radical shift

The BBC license fee should be shared with rival U.K. hybrid pubcaster Channel 4, says Michael Grade, who has served both as chairman of the BBC and CEO of Channel 4.

Grade, speaking at the Edinburgh Intl. Television Festival Sunday, also said the BBC needed to scale back the scope of its activities.

“I fear for the future of advertising-funded television in the U.K. unless there are radical changes to the ecology of broadcasting,” said Grade in his first public interview since quitting private web ITV as executive chairman last December.

“There is simply too much advertising inventory. In its present form Channel 4 is a very endangered model.”

The state-owned broadcaster should stop being financed by advertising, he said. Instead it should receive a share of the £3.5 billion ($5.4 billion) license fee, levied on all U.K. TV-watching homes and used exclusively by the BBC.

Asked to comment on BBC director-general Mark Thompson’s MacTaggart lecture delivered at the festival on Friday, Grade, who appointed Thompson when he was corporation chairman, said Thompson had failed to address the “value for money” issue.

“The BBC is too big. There is no question that it occupies too much territory,” Grade said.

“What it does, it does terribly well, but license fee payers need to be asked if the BBC should continue to keep all its present TV and radio channels.

“Does it really need to do BBC3, 4 and 2?

“The BBC has to contract. It is almost unmanageable, it is so big.”

Grade’s comments will infuriate the BBC, under pressure from rivals, politicians and the press to cut back its services.

Asked about Thompson’s MacTaggart proposal that paybox BSkyB should make re-transmission fees to ITV, Channel 4 and Channel 5, Grade was lukewarm. He said: “It is a good point, but a small one. To test the market price the broadcasters must be prepared to remove their channels from Sky.

“It is not going to change the economics of (U.K.) broadcasting.”

As for BSkyB’s role in U.K. media, Grade said he was not prepared to join those who argue that the satcaster wields too much power.

“I am past the age of demonizing the Murdoch family. Sky is a brilliant business and brilliantly run,” Grade said.

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