BBC to create new commercial arm

Greg Dyke: Set revenue targets by the Government

The BBC is to build on the success of BBC Worldwide by creating another subsidiary business, BBC Broadcast Ltd.

The new body will work alongside BBC Resources and BBC Technology, building a substantial business to create cash revenues for the corporation.

The new, wholly-owned commercial company is part of the BBC's strategy to raise £1.1bn over the next four years as part of its most recent licence fee settlement.

Creative, editorial and technical expertise are assets the BBC will use to generate income

Roger Flynn, BBC Commercial Division

The move has been approved by the Secretary of State for Culture, Media and Sport, Tessa Jowell and the company will begin trading on 2 April.

BBC Broadcast, BBC Resources and BBC Technology will make up the BBC's new commercial division.

The division will be run by Roger Flynn, who has had experience in senior roles at Prudential, British Airways and the Virgin group.

BBC Broadcast Ltd will have responsibility for promotion, playout, subtitling and broadcast continuity for 17 public service and commercial TV channels, five national radio networks, 39 local stations and all interactive services.

Targets

The BBC has said that the new company would "bring channels to life for audiences" - and it would also be free to offer its creative services, such as making trails, to others in the marketplace.

"Creative, editorial and technical expertise are assets that the BBC will use to generate income to put back in to programmes and services," said Mr Flynn.

BBC Broadcast Ltd would be set five-year financial targets agreed by Director-General Greg Dyke and his commercial board, to help the BBC meet its revenue targets.

BBC Worldwide, which merchandises BBC products, sells programmes abroad and benefits from third-party licensing deals, is already committed to achieving sales of £1bn by 2006.

Besides increasing commercial activity Mr Dyke has also attempted to make savings at the BBC by cutting external consultants and personal chauffeurs.