The Case For: `Investment in innovation'

A DIGITAL licence fee is right because it will enable the BBC to create powerful, innovative services that will encourage viewers to switch to digital.

It has been argued that the digital licence fee will delay take-up. We do not believe this to be the case. History shows that enhanced services from the BBC, made possible by buoyant funding from a new licence fee, have helped to drive the take-up of all broadcasting technologies over the past 75 years from radio to television and from black and white to colour.

I believe a powerful range of new BBC services funded by a digital licence fee will be a big incentive to switch to digital. The digital licence fee will fund a strong public service alternative to commercial TV in the digital age, which can only be for the good of viewers.

It is said the digital licence fee is a "tax on innovation" and that it will damage the profits of commercial companies. The BBC's new services will drive the take-up of digital - it is not a tax on innovation, it is an investment in innovation.

Nor do we believe that a digital licence fee will damage commercial interests. The City forecasts that Sky and OnDigital will have revenues of over pounds 4bn and make pounds 1bn a year profit from digital television by 2006. Against that wall of money it is hard to believe that a digital supplement of pounds 1.99 a month would have any impact.

I believe that the digital licence fee is equitable. It's fair when only a minority of people have digital, to ask digital households to pay a modest amount more for access to a growing portfolio of BBC services. And it will also enable the BBC to use its creative vigour to serve the public even better in the next period of its history.

Will Wyatt is Chief Executive BBC Broadcast