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Freeview is 'key TV battleground'

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BBC-backed digital terrestrial service Freeview could be the key battleground in deciding whether the corporation or BSkyB dominates UK broadcasting in the future, according to AOL Time Warner's most senior UK television executive.

If the BBC can persuade millions to buy Freeview set-top boxes and give the service's 30-odd digital channels widespread terrestrial distribution, viewers would be less willing to pay for BSkyB's offering, Andy Bird, the co-president of AOL Time Warner subsidiary Turner Broadcasting System International, has warned.

But he added that BSkyB was playing a clever game, getting involved in the marketing of Freeview and taking channel capacity on the service, and was the "one organisation that has the physical, financial and intellectual bandwidth to stand up to the BBC".

"I believe the future of British television lies more in the hands of [BBC director general] Greg Dyke and [BSkyB chief executive] Tony Ball than anyone else. The game is a battle of the giants... one which may well be played on a pitch called Freeview," Mr Bird said, speaking at a Royal Television Society dinner last night.

"If Greg can get Freeview to work and become more widely distributed, then he has a better argument in the charter renewal process. If Freeview works, it's feasible that the UK will start to resemble Germany, with 28-30 widely distributed terrestrial channels," he added.

"These channels command serious revenue streams and provide a wealth and variety of programming, including things like sports rights. When you have a market dynamic such as exists in Germany today, the appetite for a pay TV platform [such as BSkyB] is greatly diminished."

Mr Bird said ITV, Channel 4 and Channel Five did not have the "financial muscle" or the bandwidth to compete with the BBC. "So they are getting and will continue to get marginalised."

BSkyB was in the best position to mount a serious challenge to the BBC, he argued.

"Sky being the smartest kid on the block is also playing both sides and is perfectly poised to dominate commercial TV in the future.

"They're in the marketing alliance for Freeview, they have channel capacity on Freeview and best of all, they can buy Channel Five to give them an analogue window if needed," he said.

Mr Bird oversees channels including CNN International, movie service TCM and Cartoon Network.