Leader: Damned if they do...

Emily Booth, Broadcast's acting editor

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It's crunch time for BBC Worldwide if it is to head off its growing band of critics.

The growing strength of feeling about BBC Worldwide's encroachment in areas previously the preserve of wholly commercial businesses shouldn't be underestimated. Its critics are beginning to look like a critical mass.

Producers have accused it of making risky investments with licence fee payers' money and playing at being a business in a world where it may become unstuck, damaging the BBC brand. Television's equivalent of sub-prime lending, to quote Wall to Wall's Alex Graham.

In reality, the BBC's commercial arm is stuck between a rock and a hard place. There's a tension between maximising commercial opportunities on one hand, and the sense that it's taking money from businesses which don't have the advantages of the licence fee on the other. In every charter review, the BBC is told it has to create more income to help itself. Now it's getting better at it... and taking flak for it.

There's little doubt that BBCW is important in exporting UK plc around the world. The success of Dancing With the Stars, for example, has been crucial in leading the charge into the US. BBCW has the clout to get into markets that smaller outfits could have a tough time negotiating. It has invested £30m in 2007/08 in new business and part of that was into growing indies, supporting a vital part of the broadcast ecology.

But its £90m Lonely Planet deal raised eyebrows and is under scrutiny by the House of Commons culture, media and sport select committee in a wide-ranging examination of whether the BBC's commercial activities are distorting the market. One area of enquiry is likely to be whether BBCW's investment in indies inflates prices. Who's to say that other global players, such as Fremantle, couldn't do what BBCW does in international markets - and just as successfully?

Then there's the element of risk. Investing in international production companies offers opportunity for growth. But there is also a chance of something going wrong, meaning that money which could have been better spent on programmes would be flushed down the drain - nothing short of a PR disaster.

To keep within its remit, BBCW and its operating divisions have to comply with four criteria. It must be commercially efficient; fit with the BBC's public purposes; not jeopardise the good reputation of the BBC or the value of the BBC brand; and comply with the fair trading policy and guidelines without distorting the market.

BBCW's detractors say it is damaging the market - and if BBC Worldwide and the Trust fail to take the issue of its commercial expansion seriously, their arguments will begin to look increasingly robust.
Emily Booth, acting editor