BBC chairman Gavyn Davies has given the thumbs-up to BBC Vecta, a wholly-owned BBC venture capital enterprise that will fund worldwide broadcasting, technology and internet company start-ups.
The fledgling, launched Monday, radiates the atavistic influence of chairman Davis, a multi-millionaire who joined the BBC in September 2001 from US investment bank Goldman Sachs where he ruled the roost as chief international economist.
Vecta will exploit existing BBC technology and services to launch and eventually sell-on, float or merge new companies. It has a target of achieving twelve such ventures within three years.
The Beeb’s rivals are not expected to put out the welcome mat for Venta, and will almost certainly reprise their chorus of complaint about the Corporation’s growing commercialism. There will also be dissent from within the BBC itself, reflecting fears that the new entity will divert resources and funds from programme-making, or compromise the BBC’s public service obligations.
Davies disputes this. “Virtually all of our commercial subsidiaries are profitable and have returned well over £100m in cash,” he claims. “So it’s not a question of all these commercial ventures somehow sucking the lifeblood out of the licence fee, but the reverse.”
But sceptical observers are reaching for the salt, arguing that an executive as commercially savvy as Davies knows full well the new venture is three or more years away from profit – and that the BBC’s purse, albeit bulging, is finite. Over the take-off period, they aver, the necessary funds can be siphoned only from other BBC activities – unless Davies is planning to borrow.
BBC Vecta, which subsumes an existing internal enterprise, Kingswood Warren Ventures, will be headed by managing director Mark Popkiewicz, a quondam high-flier with US group Lucent Technologies. “Realising the value from these projects could take a number of routes including sale or flotation,” he reiterated.
Added Davies: “We want to develop more and more durable and more successful partnerships from many aspects of our business with the public, universities, museums, right across the piece. We want to develop public-public and public-private partnerships.”
Given this latest example of the BBC's extra-curricular adventurism with public funds, it is little wonder there is increasing political and commercial pressure to place BBC finances under review by the National Audit Office [WAMN: 02-May-03].
Data sourced from: Financial Times; additional content by WARC staff