Carter: C4/BBC Worldwide 'makes sense'

Communications minister publishes Digital Britain report

LONDON -- The government has thrown its support behind a planned merger of Channel 4 and the commercial arm of the BBC, a move that could herald a major shake-up in the U.K. broadcasting landscape if it goes forward later this year.

In Thursday's long-awaited Digital Britain report, Communications Minister Stephen Carter said that Channel 4 needs to broaden its public purposes and be placed at the front and center of a new public service entity suited to the digital and broadband age.

"At the heart of this new remit should be strong commitments to international and national news, current affairs, documentaries and film, with the prospect of introducing programming for older children and news for the nations," he said.

Carter said it "made sense" to begin by looking at combining public sector bodies Channel 4 and BBC Worldwide, but added that the government also will look at a range of other partnership options before delivering a final blueprint for the broadcaster's future in June.

The broadcaster has said it will need an extra 150 million pounds ($206.4 million) a year in funding by 2012 if it is to maintain its level of public service broadcasting output, but CEO Andy Duncan welcomed the government report Thursday.

"We're delighted our preference for partnership with BBC Worldwide is again identified as the most sensible starting point," Duncan said. "We're in active discussions with Worldwide and there is real desire and momentum to deliver a material partnership, which we believe can deliver the greatest cultural and economic benefit."

The report also called for accelerated broadband penetration across the U.K. and warned Internet service providers that they face legal action if they fail to deter illegal file sharing.

The report was welcomed by Culture Secretary Andy Burnham, who said the proposals will enable Britain to "lead the world in content creation" and by Prime Minister Gordon Brown, who said the digital economy is "essential to Britain's future prosperity."