BBC Muscles In on Murdoch's Satellite Monopoly

The UK government is at last getting serious about digital television. Culture, media and sport secretary Tessa Jowell has lodged a £300 million ($536.58m; €450.52m) bid in the Blair administration's annual spending round.

The money will be used to fund the switchover from analogue to digital broadcasting, with £100m earmarked for marketing -- most of it to persuade the reluctant 13% of Britons who have told market researchers they have no intention of switching.

At the end of 2003, a total of 10.96 million homes (44.5%) had gone digital. This figure is expected to increase to 87% within the next four years, and the government is doughtily standing by its target of analogue switch-off by 2010.

But, conscious of the political sensitivity of depriving a substantial minority of voters of their TV fix, the Blair administration has promised it will not switch off the analogue signal until 95% of all UK households have digital television.

The proposed £300m investment is peanuts alongside the income that 100% digital broadcasting will generate. In addition to the benefits that will accrue to the TV and radio industries, an estimated £2 billion will flow into the UK treasury from the sale of the analogue spectrum to mobile communications networks.

• Meantime, the BBC -- whose highly successful Freeview multichannel digital service has given a massive boost to the overall uptake of digital TV -- on Monday announced its intention to extend its digital broadcasts to satellite viewers.

The move may prove a red rag to the News Corporation bull, whose BSkyB unit commands British pay-TV with 7.2 million subscribers.

Sky enjoys a satellite TV monopoly in the UK and is unlikely to take kindly to the BBC's incursion into its hitherto unchallenged territory. Especially as it recently announced a new target of nine million customers.

But the BBC claims its purpose is solely to provide digital benefits to those consumers unable to receive its Freeview transmissions and unwilling to further line Rupert Murdoch's pockets.

Says BBC director of marketing, communications and audiences, Andy Duncan: "We are very clear that for the government to reach its [switchover] target and for the BBC to maintain universality, a free-to-air satellite proposition is required."

Data sourced from: Times Online (UK) and Financial Times; additional content by WARC staff