On competition with government companies: The case of the BBC

James Murdoch, chief executive of News Corporation, Europe and Asia, has some words of warning that are probably relevant to government competition in other sectors.

An out-of-control BBC and addiction to central planning by regulators are damaging democracy and media choice in Britain, James Murdoch said in Edinburgh last night.

Giving the annual MacTaggart lecture to an audience of television executives, Mr Murdoch, 36, the son of Rupert Murdoch, called for a “dramatic reduction of the activities of the State” in broadcasting, arguing that it effectively treated viewers like children.

He contrasted the prevailing political attitude to mainstream broadcasting with the lightly regulated newspaper, film or book industry where consumer choice predominates.

Mr Murdoch, chief executive of the European and Asian operations of News Corporation, parent company of The Times, said: “In the regulated world of public service broadcasting, the customer does not exist: he or she is a passive creature — a viewer in need of protection.

“In other parts of the media world, including pay television and newspapers, the customer is just that: someone whose very freedom to choose makes them important.”

He said that the “chilling” expansionism of the BBC meant that commercial rivals and consumer choice were struggling. In particular the “expansion of state-sponsored journalism” in the form of BBC News online was “a threat to plurality and the independence of news provision, which are so important to our democracy”.

Mr Murdoch criticised Radio 2’s effort to woo younger listeners by hiring presenters such as Jonathan Ross on “salaries no commercial competitor could afford”.

“No doubt the BBC celebrates the fact that it now has well over half of all radio listening. But the consequent impoverishment of the once-successful commercial sector is testament to the corporation’s inability to distinguish between what is good for it and what is good for the country.” . . .