BBC License Fee Will Not Bail Out Channel 4 Digital Switchover

LONDON, November 26: The
U.K. government has scrapped a proposal to use £14
million from the BBC's license fee to help pay for Channel 4's digital
switchover costs.

Culture
Secretary Andy Burnham gave Parliament a written statement explaining that more
wide ranging plans were needed, beyond simply tackling Channel 4's switchover
costs, and that the broadcaster's future in the digital era would be decided
early next year.

Channel
4 has said it backs the government's decision to withdraw the proposal. It does
stress, however, that by maintaining its public service obligations, it will
face a funding shortfall of nearly £150 million by the time digital switchover
is completed in 2012.

The
proposal to use a portion of the BBC's license fee to help pay for Channel 4's
switchover was originally announced in 2007. The plan had prompted an
investigation by the European Commission, which was concerned that the proposal
was a breach of its rules on state funding.

—By
Anna Carugati