Commercial broadcasters warn government about BBC dominance

The broadcasters, including Charles Allen, the ITV chief executive, and David Elstein, chairman of the Commercial Radio Broadcasters Association, have said in a letter to Tessa Jowell, secretary of state for culture, media and sport that the BBC's new licence fee bid could do "huge damage" to the commercial broadcasters.

Various parts of the industry have previously expressed concerns individually contacting the government, but this is believed to be the first time a joint approach has been made.

Last week the Institute of Practitioners in Advertising has backed calls to temper the BBC's request for an increase in the annual licence fee in response to an independent study commissioned on behalf of commercial broadcaster ITV.

The broadcasters' letter argues that the government does not fully appreciate the long-term damage that an over-funded BBC could do to the commercial sector and the UK's "broadcast ecology".

It argues that the commercial industry does not believe that its concerns are "fully appreciated" by government.

"If the government were to accept the BBC's bid for an increased licence fee, even if at a reduced level, it would signal a disregard for the wealth-generating importance of commercial broadcasters and the social imperative of a plurality of quality content provision. 

"Our ability to contribute to a balanced broadcasting ecology will be undermined if even greater public funding enables the BBC to increase its dominance across all platforms while driving up the cost of content for all broadcasters, both of which will be the inevitable outcome of yet another RPI-plus settlement."

The letter is also signed by Charlotte Wright, executive director of the Satellite & Cable Broadcasters Association, which is the trade association for satellite and cable programme providers including CNBC Europe, Discovery Networks Europe, Flextech Television/Telewest Communications and MTV Europe.

The licence fee currently costs viewers £126.50 a year and the BBC has asked for an inflation plus 2.3% increase, which could see it hit £200 by 2016.

This morning Mark Thompson, the BBC director-general, claimed that the corporation is the only European media owner that can take on the might of Google and AOL.

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