Media: All about ... BBC Worldwide

determined by the inconvenient fact the BBC exists by virtue of a Royal
Charter that needs renewing once a decade.

As the Charter review process begins to kick in, roughly three years
before renewal is due, you'll find the BBC Worldwide corporate beast at
its most modest and demure, attempting to blend into the furniture as it
makes more or less plausible noises about acting responsibly to get the
best out of existing BBC assets, mainly to relieve pressures on the
licence fee.

But as soon as the new Charter is secured, all semblance of restraint
tends to fall away - and you find Worldwide unveiling blueprints of a
global media empire to rival the News Corps of this world. It's not
always a pretty sight.

Therefore, in an attempt to fathom why BBC Worldwide recently paid
£100 million to acquire 75 per cent of the travel guide business
Lonely Planet, or in assessing the merits of moves to reinvent BBC.com
as a full-blown ad-supported commercial entity, it will help to remember
that a new Charter was granted to the BBC with effect from 1 January
2007.

And it's ironic that Worldwide is contemplating a leap forward at a time
when the BBC's director-general, Mark Thompson, has (in response to a
below-inflation licence fee award) begun forcing through painful
structural changes in the corporation's UK TV operations - changes he
believes will create a smaller domestic BBC "but one which packs a
bigger punch".

Senior strategists will argue that this sort of local domestic
difficulty shows beyond all shadow of a doubt that BBC Worldwide has a
greater-than-ever duty to rake in the cash. Equally, however, there will
surely come a time when it is difficult to remember which bit of the BBC
is the tail and which is the dog.

1. Historically, the remit of BBC Worldwide (and its predecessor
organisations) was to oversee publication of the Radio Times and various
masthead spin-off magazines, plus the sale of BBC Television programmes
to non-UK broadcasters. This remit changed out of all recognition with
the explosion in multi-channel television platforms from the mid-90s
onwards. For instance, it struck a joint venture deal with Flextech in
1997 to launch UKTV. But the real step-change came with the launch of
international TV brands such as BBC World.

2. In July, following an announcement of a 24 per cent increase in
pre-tax profits to £111 million, BBC Worldwide's chief executive,
John Smith, revealed he was building a £400 million war chest for
future acquisitions. He also unveiled his intentions to grow overseas
revenues, 46 per cent in 2006/7, to 66 per cent by 2012. Online revenues
are expected to be a significant element of that growth.

3. The BBC's international commercial channel properties include BBC
World, BBC Prime, BBC America and BBC Food. A second wave of channels,
including BBC Entertainment, BBC Knowledge, BBC Lifestyle and CBeebies,
is currently being rolled out across the globe. Additionally, there is a
joint venture agreement with Discovery Communications Inc.

4. In the run-up to Charter renewal, the BBC leaked stories that it was
considering selling assets, including its magazine division. In the end,
it parted with only one title, Eve. It also indicated that it was to
shelve plans to introduce advertising on BBC.com.

5. Internet-delivered content is now central to the BBC's survival plans
in the UK, as well as its expansion abroad. In March 2007, BBC Worldwide
entered into an exclusive global content agreement with YouTube. It has
also been investing in the development of a commercial media player that
will allow UK and international audiences to watch content via the
internet after the seven-day catch-up service offered by the BBC's
public service iPlayer.

6. According to last week's statement from the BBC Trust, advertising
will now be carried "on a subset of pages of the existing (BBC.com)
website, including the home page and selected news, sport, weather and
science and nature pages visible only to international users of the
site".

WHAT IT MEANS FOR ...

THE BBC

- Enemies of the BBC (and, strange to relate, there are a few) will
argue that the corporation should be given just as much rope as it
needs. They argue the organisation will, at some point, implode under
the strain of inherent internal contradictions.

- Those contradictions are never more stark than when strife on the
public service side coincides with aggressive expansion in its
commercially funded activities.

ADVERTISERS AND AGENCIES

- Media agencies are often reluctant to criticise the BBC, even when it
is (even theoretically) acting against the commercial interests of their
clients.

- And clearly, you can argue that the BBC's online activities continue
to stifle the development of homegrown commercial online operations. It
uses the licence fee to dominate the domestic online audience and then
uses licence-fee-generated content to take more than its fair share of
internationally derived online revenues.

- But many agencies are confident the BBC can keep the UK and
international sides of its business separate, even in a borderless
digital world. Jim Marshall, the chairman of Starcom and the IPA's Media
Futures Group, comments: "Obviously you can argue there are future
ramifications arising from the decision to carry ads on BBC.com, but
currently it doesn't have too many implications for the UK market. I
don't believe it's a major issue."