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To: Bennitto who wrote (15)6/1/2006 5:36:41 PM
From: joseffy   of 20
BBC to take on Google and AOL
. .

31st May 2006

The BBC has outlined the scale of its global ambitions after the director-general said its aim was to rival internet giants Google and AOL.

Mark Thompson said the BBC was the only European brand with the clout to take on the American media giants.

Although he insisted that any international expansion would not be funded by the licence fee, critics claim it will inevitably rely indirectly on the tax on television sets.

His announcement will further alarm the BBC's domestic competitors such as Sky, BT and ITV who are already unhappy by what they say are the Corporation's expansionist tendencies.

The BBC has long had a strong global presence thanks to the BBC World Service, the radio service which is funded by the Foreign Office and broadcasts in 33 languages.

The authoritative reputation of the Corporation's TV and radio news has also helped with the growth of BBC News online - which is now the sixth most popular website in the world - while BBC America, its US television channel, reaches 45m homes via cable.

In a bid to beef up the BBC's international presence its commercial arm, BBC Worldwide, is set to launch a new advertising-funded website - which will be accessible only outside the UK - later this year.

It is also looking to buy up existing businesses including video-on-demand services while the Corporation's technicians are currently working on their own internet search engine which would be a direct rival to Google.

Other avenues being explored include buying up foreign magazine publishers in a bid to replicate the success of the BBC's own UK titles such as Top Gear and the Radio Times, and increasing the number of overseas BBC channels - such as BBC America - so that the Corporation is better able to make money out of hit shows such as The Office and Strictly Come Dancing.

In an interview with the Financial Times, Mr Thompson said: 'The BBC is the only European brand that could take on Google and AOL.'

But he insisted that the Corporation's plans was no different from any other media organisation in looking to explore new ways to growth.

'You won't find a single commercial organisation on the planet which is ruling out any distribution technology and the BBC's thinking in the same way that everyone else is really.

'There are some areas where we are quite cutting edge, such as on-demand over the web. Other areas, like mobile, we are in the pack.

'But we're doing no more than any other media organisation in the world is doing.'

But critics and competitors claim the BBC's global growth is founded on its guaranteed licence fee revenue - around £2.9bn last year.

The BBC is currently waiting to hear what its next licence fee settlement will be.

It has asked for the licence fee to grow at twice the rate of inflation over the next seven years - to £180 by 2013 - although rivals such as ITV claim its bid is based on 'back-of-a-fag packet' calculations.

Other British media companies have been frantically trying to adapt to sweeping technological changes such as the internet and digital television.

BT, for example, is moving away from being just a traditional telephone company and has started offering its customers TV and video-on-demand services too, while Sky has bought a broadband company to add to its main business as a satellite television broadcaster.

Google and AOL, part of Time Warner, are two of the biggest media companies in the world with stock market values of £60bn and £39bn respectively.
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