This is taken from the Financial Times:

Expansion has diminished the Beeb
By Philip Stephens
Published: October 23 2006 19:53

I sometimes think Mark Thompson knows all too well that the game is up. In his quest to turn the BBC into a global media giant sufficient, in his own description, to rival Google, the director-general is anticipating the end of its Reithian mission. By the time the politicians decide they need a different model of publicly financed broadcasting, the BBC, or much of it, will be ready to make its way in the marketplace.

Mr Thompson, I suspect, would vehemently deny such motives. I may be wrong in imputing them. What seems irrefutable is that the BBC of the director-general’s grand ambition marks a decisive break with the old public service bargain. Mr Thompson’s corporation is too big, too diverse and too distant from its original purpose to sustain its claim to a unique place in Britain’s national life.

The BBC charter for the next decade has been agreed. In coming weeks the government will set the financial framework. Mr Thompson insists the corporation must be guaranteed a real terms increase of nearly 2 per cent annually. Otherwise, he warned the government this month, it will be unable to guarantee a smooth national switchover to digital broadcasting or to move some production facilities to Manchester.

I find it hard to imagine that Gordon Brown will be cowed by such threats. The chancellor has told the big Whitehall spending departments that he wants a 5 per cent cut in their operating budgets for the period of the next comprehensive spending review. The spending round, Treasury officials say, will be bloody even in priority areas such as health.

The Home Office, faced with financing the fight against jihadi terrorism, as well as prisons filled to overflowing, faces a real terms freeze in its overall budget. So, I would be amazed if Mr Brown did not call the BBC’s bluff. Mr Thompson should count himself immensely fortunate if he gets a deal tying the BBC licence fee to the inflation rate.

More interesting than the financial settlement is the emerging shape and scope of the BBC. Some of it was set down by the politicians in the charter agreement. But overall it owes more to Mr Thompson’s vision of the future of the global broadcasting industry.

On one level, Mr Thompson paints a compelling picture of the BBC’s place in the digital age. He is right to say the corporation’s contribution to national life can no longer be measured by the audience share of BBC1. In a multi-channel era, what the director-general calls “reach” is a better guide to the corporation’s performance. Reach measures the consumption of BBC services across its myriad outlets.

Nor can the director-general be gainsaid when he insists that modern broadcasting is about much more than we see on our televisions or hear on our radios. The web and mobile devices are transforming the way people access information and entertainment. The BBC would be justly accused of wasting its huge resources if it did not make use of these new platforms.

Here, though, the logic of expansion collides with the BBC’s near monopoly in public service broadcasting. The more the corporation expands – globally as well as nationally – the harder it is becoming to differentiate between the public and the commercial; and the more platforms through which it broadcasts, the more obvious the diminution in the quality of its core licence fee services.

This dilution of purpose has already happened in news and current affairs – which are at the heart of what Mr Thompson has called the BBC’s role in promoting “an informed and engaged democracy with access to objective, impartial news and information”.

The manifest deficiencies of the BBC’s news operations – among them the casual merging of reporting and opinion, the preference for celebrity over accuracy, a visible disdain for politics, an obsession with Iraq and a rising anti-Americanism – badly undercut Mr Thompson’s claim.

One reason for the decline, I am told by senior BBC journalists, is that news programmes must have “impact” in order to grab audiences; another that lines of editorial guidance and control are too thinly stretched to ensure an even quality over the BBC’s multiple outlets.

No one should imagine Mr Thompson has it easy. Since the advent of commercial broadcasting, the BBC has had to square the circle between its public service remit to inform and educate and the need to retain audiences large enough to justify a universal licence fee. The tension has grown more acute. And the BBC still provides some superb, public service broadcasting – across television, radio and the web.

Yet the more it tries to do everything everywhere, the more such excellence becomes the exception; and the harder it becomes to distinguish the BBC from its commercial rivals. In reality, the future of public service broadcasting lies in doing less, better. But then, if I am right, Mr Thompson already knows that.