C4 presses for a BBC lifeline

CHANNEL 4 is in talks with the BBC on ways of collaborating to help it cope with an expected £100m revenue shortfall.

The station, publicly owned but commercially funded, is understood to have pressed ahead with talks with the BBC after it ended discussions with Five last week over a possible merger.

Now chief executive Andy Duncan is thought to be keen to strike a deal with the BBC to take advantage of its expertise in new media and technology.

He also wants to ensure that the BBC is held to its suggestion that it takes the lead in paying for the upgrading of the analogue transmission network to digital, allowing Channel 4 to reduce its own annual contribution to this project.

Channel 4, whose new shows include Max And Paddy's Road To Nowhere starring Peter Kay and Patrick McGuinness, reckons it needs extra help because it expects to lose £100m in advertising revenue by 2012 when the analogue signal will be switched off.

The station will this week call for public funding for the first time in its 24-year history to alleviate its expected financial strains, but developing links with the BBC implies that it also wants to benefit from the licence fee. 'We are in talks with the BBC,' said a Channel 4 source. 'We compete with them, but there are a number of areas that we think have the potential for collaboration.'

The BBC is reviewing the future of its commercial division, BBC Worldwide, and Channel 4 could become involved there too.

While the BBC is thought to have ruled out offloading the whole of Worldwide, which sells BBC programmes abroad as well as books and magazines and is estimated to be worth up to £2bn, it could sell some parts.

Channel 4 might wish to acquire its UKTV digital channels, jointly owned with Telewest, which include popular channels such as UKTV Gold.