It's battle stations for the BBC as it prepares to compete against hundreds of new channels. Survival depends on fresh ideas, nerve - and more money

his is the age of revolution, Sir John Birt told us last week as he described the wonders - and the threats - of the digital age. And indeed there is a revolt going on in television, but not one that the outgoing director-general of the BBC and his fellow broadcasters like to admit. For, although we've gained dozens of channels, the British are watching less V than ever before.

Each week we watch, on average, seven and a half hours of BBC1 - an hour and a half less than we did six years ago - according to industry figures, and IV has lost a quarter of its audience share. First the satellite channels and now, to a very limited extent, the digital channels have made inroads into viewing time. But something else is happening, too: the viewer, bombarded by choice, appears to be switching off.

Mark Booth, the former boss of BSkyB, used to say that digital would succeed on the "wow factor" - but so far, most people have found it pretty much wow-free: only one and a quarter million people have signed up to it, despite the free set-top boxes.

Eventually, when analogue services are switched off by government decree, we will all watch digital television, and the BBC's preparations are well under way. Six years ago John Birt decided that the corporation should compete seriously if it is to survive at all in the digital age, and launched a host of new channels.

So far they have been criticised for being cheap and lowbrow: BBC Knowledge, for instance, feels more like Blue Peter than University Challenge. Yet the corporation is also lambasted for spending too much on digital channels - 7 per cent of the pounds 2.2bn licence fee last year, and close to 10 per cent this year. But to lift the quality of its digital channels, the corporation needs more cash - about pounds 200m a year - and no one can decide on where the money should come from. A digital licence fee of about pounds 30 is being considered by a Government-appointed panel looking at BBC funding, but the rest of the industry has damned it as a "digital poll tax".

he BBC knows that it can endure in its current form only if the licence fee survives, which depends on keeping audiences at high levels. But digital audiences will be fragmented, often choosing programmes rather than channels, so the struggle for ratings can only get harder.

"Unless and until the BBC's income grows," Sir John said last week, "... the BBC will gradually, slowly, imperceptibly, incrementally diminish in relation to the rest of broadcasting and will play a reducing part in this nation's life."

Elisabeth Murdoch, of BSkyB, argues in these pages that that role is an unintentional by-product of the limits of analogue services. Alan Yentob maintains, agreeing with Sir John, that the point of the BBC remains to be at the heart of society. Certainly it will fall to Sir John's successor, Greg Dyke, to succeed at the tough task of keeping the BBC competitive when analogue has gone and the corporation is competing, in all households, against hundreds of channels.