Funding received by the BBC via the licence fee could soon be diminished following possible reforms ordered by media regulator Ofcom. One option under review could lead to the licence fee being sliced up so that money could be channeled to other organisations to spend on “public service” web and television ventures. Though the BBC would retain the lion’s share of the levy, any reduction would have profound implications for the corporation.

Ofcom believes it has to consider a range of options to avert a crisis in public service broadcasting at a time of radical change. Insiders believe a new means of allocating public money via a newly created body could entice innovation, but would prefer to leave the government to decide how to finance it.

The regulator, while committed to maintaining a strong BBC, is also keen to find new ways of delivering public service content to a generation growing up with mobile phones, broadband Internet and a vast array of media choices. The idea is among several being considered by Ofcom as part of a review, which will feed into a government review of the sector and new legislation.

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