Media Forum: Is selling BBC Worldwide a good move?

The BBC may be looking to sell off its Worldwide division. What are the implications for advertisers, Alasdair Reid asks.

Can the BBC really be looking to dispose of its Worldwide division?

Worldwide, the commercial wing of the corporation, exists to "monetise" BBC television output in a number of ways.

First, while programmes are in their first run, their content is used to fuel magazine spin-offs against which advertising is sold; second, when the corporation has wrung every last decent rating out of it, programming is then sold on to other broadcasters around the world. These are largely commercial broadcasters, some of which, such as UKTV, are co-owned by Worldwide itself.

Last, but by no means least, Worldwide also develops books, DVDs and licensing spin-offs. Tubby Custard, anyone?

All of which means it is hard to envisage Worldwide having an existence truly independent of the publicly funded corporation that makes the programmes in the first place. Also, the whole raison d'etre of the division is (theoretically) to maximise the return on publicly funded assets so the money can be ploughed back into programme production.

Handing someone else a cut might produce an interesting lump sum in the short term but diminish the long-term flow of funds. However, change of some sort is clearly in the air - senior managers have been conducting a strategic review. And the corporation is reported to have held exploratory talks with, among others, Disney, Bertelsmann and Time Warner.

Actually, this could be good news for everyone, including the BBC, Marie Oldham, the managing director of Media Planning Group, argues. She should know - she used to be the business development director at Worldwide. She says those who sell BBC assets (and continue to develop spin-offs) in the future will still be paying the BBC its due and, if they succeed in growing the properties they buy, then the BBC will get even more money than it does at present.

Meanwhile, the advertising community could benefit too. She says: "If you look at magazines, for instance, it would allow for more consolidation in the market. In the past, the BBC may have had, say, one food magazine.

If it went to a larger publisher, it might have a number of magazines in food and related areas and have a real expertise in getting the most out of advertisers in that sector. It is about having focus."

This could be a case of back to the future. BBC magazines were, in their earliest incarnations, produced on a contract basis by Redwood. But many are sceptical about whether the BBC is serious about any of this. Jim Marshall, the chairman of Starcom UK Group, comments: "I suspect we will not see much happening before the Charter review process is completed. In fact, this all has to be seen in the context of that process because whatever happens, I do not think we are going to see the BBC being given more licence-fee money than it currently gets and, in all probability, it might get less in real terms. So it might be a case of it looking to sell off Worldwide if it has to make up a deficit."

But Andy Jones, the joint managing director of Universal McCann, says that this could actually be an important symbolic moment - significant for the signals it sends. He comments: "The BBC's line tends to be that it is damned if it does and damned if it doesn't. If it doesn't exploit its assets to the full or doesn't get the biggest ratings for the programming budgets, then it will say it will be accused of wasting tax-payers' money.

"But there have to be worries over, for instance, some of the BBC's digital investments. You have got to admire what it puts out in the area of children's channels but, on the other hand, look at radio. Just how many more radio stations does the BBC need? Arguably, it should be looking to sell off a lot more than BBC Worldwide and if this is a first step in that direction, then it will be welcomed."

Chris Boothby, the operations director of Vizeum, agrees that there could be an element of political manoeuvering as the Charter review process intensifies. But he believes that selling Worldwide could seriously undermine the corporation in quite subtle ways. Boothby says: "One of the ways in which Worldwide is valuable is in enabling the BBC to keep its finger on the pulse of the commercial market. For instance, through UKTV, it has access to many aspects of new thinking in the digital world (via the cable interests that co-own and sell the channel). I should think that it would be very reluctant to let that go.

"Worldwide is a prime asset and selling it would produce only a short-term gain."

- "I have a lot of time for Worldwide. It has been good at what it does. But it is under pressure to focus and there are ways of structuring (new ownership arrangements) so a new media owner can build relationships with BBC programmers the same way people at Wood Lane do." - Marie Oldham managing director, Media Planning Group

- "I don't think we'd see a different culture if Worldwide changed hands. It's not as if it isn't a well-run and very commercial operation. The BBC makes sure it reaps all the benefits you can get from being a large organisation. I'm not sure it would look any different." - Jim Marshall chairman, Starcom UK Group

- "There's a broader issue of aggressive commercialism that has crept in at the BBC over the past ten years and it is clearly involved in a lot of areas that it shouldn't be involved in. If this marks a general rethink of the BBC's role in the world, then that would be welcomed." - Andy Jones joint managing director, Universal McCann

- "People have often thought it unfair BBC magazines can effectively advertise on BBC TV. It's a competitive advantage. Would a new media owner be allowed to continue doing that? You have to doubt it over the long term. If they can't, is it worth acquiring these assets?" - Chris Boothby operations director, Vizeum.


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