Tories call for limit to BBC's online ambition

The Conservative Party has allied itself with commercial internet news publishers concerned at the expansion of the BBC's online empire.

Shadow chancellor George Osborne, speaking at a communications conference in Oxford on Monday, said the corporation "must not become the bull in the china shop of new media" and called for the BBC's charter to be amended to limit its activities.

"I am concerned that, in too many of its non-core activities, particularly on the internet, it is stifling the growth of innovative new companies that simply can't compete with BBC budgets," he told delegates.

"[Its plans for] what it calls 'ultra-local television' might sound like a reasonable idea, but it could have a ruinous effect on local newspapers and local radio stations."

Party leader David Cameron began the criticism last week at the Newspaper Society's annual lunch.

"I do think there is a problem with the BBC over-extending itself," he told the assembled editors and executives. "We've all seen, in our own constituencies, small internet businesses involved in education or information provision working away to create a market, making some money, and then the BBC comes along and, squish, like a big foot on an ant, the business goes down.

"And so we need to look at ways of making sure that the BBC doesn't over-extend itself."

The Newspaper Society, which represents the publishers of around 1,300 UK local and regional titles, said Mr Cameron had "endorsed" its campaign against the corporation using the license fee to finance online services - an effort in which it has previously been joined by commercial content providers comprising the British Internet Publishers Alliance.

The BBC is currently trialling a local TV service over digital satellite and broadband internet in West Midlands radio regions, and the government has said full-scale rollout would be subject to public value tests.

The corporation previously shut down some websites in response to the Graf report and last year announced the loss of hundreds of jobs and multi-million pound savings engineered to reinvest in services like local TV.

Unveiling the corporation's Creative Future plan in April, director-general Mark Thompson signalled an evolution in the emphasis of bbc.co.uk toward on-demand broadband programming and personalised, social networking experiences. He said more resources through the license fee were central to creating quality content.

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