BBC Worldwide Restructure Sparks Selloff

26 January 2005

British public service broadcaster the BBC, pressured both by the UK government and commercial media rivals, is poised to sell-off of some of its prime non-broadcast assets.

These currently nestle beneath the wing of the corporation's commercial offshoot, BBC Worldwide, which last year generated £141 million ($262.9m; €203m) in cash for the state-owned body.

BBCWW's ten-member board will meet in February to approve the sale of at least five properties which, predicts BBC chief operating officer John Smith, could realise £350m. Among those tagged for disposal are BBC books, audio books, education publishing and Audiocall, an interactive telephony business.

Publishing and broadcast rivals have for several years lobbied relentlessly for the emasculation of the BBC's commercial activities which they see as unfair competition subsidized by public money - an unconvincing argument given that BBCWW is a substantial net contributor to its parent's funds.

Many lobbyists pressed for BBCWW to be sold as a single unit, a prospect that set the gastric juices flowing among such suitors as Time Warner and the Walt Disney Company. But their ambitions were thwarted last fall when the BBC's management and board of governors decided against an outright sale [WAMN: 14-Oct-04].

One of those gnashing his molars is former BBCWW ceo Rupert Gavin, who resigned in 2004 with the intention of bidding for the whole division on announcement of a sell-off. He was not available for comment on the planned partial disposal.

In addition to the intended sale, Smith and other managers intend to wield long knives on BBCWW overheads. They aim to cut costs by ten per cent - an ambition that will lead to several hundred job losses.

Data sourced from Financial Times Online; additional content by WARC staff