Chapter 390 BBC’s proposal

When Tamaran woke up, sunlight poured in through the gaps in the curtains, and she was alone in the room.

At this moment, she couldn't help but have many images of last night appear in her mind, as if they were a dream.

She got up, found some clothes and put them on. After washing, when Tamaran walked out of the bedroom, she saw the housekeeper Riley walking over.

"Hello, Miss Ecclestone."

"Ms. Riley, where is Barron?"

Hearing Tamaran's words, Riley smiled and said:

"His Royal Highness the Duke is meeting a guest in the reception room on the second floor. He has told you that if you wake up, you can have something to eat first. Can I let the kitchen prepare breakfast now?"

Hearing what Riley said, Tamaran suddenly felt hungry. She nodded and said:

"Okay, thank you, Ms. Riley."

"It's my pleasure."

…

At this time, in the reception room on the second floor, sitting in front of Barron was BBC President Dyke, who had made a special trip from London.

The other party has only one purpose, and that is to increase its investment in Digital UK to increase the BBC's shareholding proportion in this digital TV network with the largest number of users in the UK.

“What you need to know is that we initially sold a majority stake in Digital UK, but the BBC was not enthusiastic about bearing the huge upfront costs, so we at SEM Group had to take over control of the company. When funds were tight, we insisted on investing a high amount of money. But now..."

Barron's words made Dyke a little embarrassed, because what he said was the truth.

As early as the second half of 2002, SEM Group reached an agreement with the BBC, and the two jointly funded the establishment of Digital UK, a company specifically responsible for managing British terrestrial digital television strategy, policy and service development.

Digital UK's shareholding ratio is SEM Group's 60% shareholding, while the BBC holds 40% of the shares. The two companies contribute funds according to their shareholding ratios to promote the terrestrial digital TV platform Freeview.

Later, ITV also joined Digital UK. Currently, Digital UK's shareholding ratio is SEM Group holds 51%, BBC holds 34%, and ITV holds 15%.

The reason why SEM Group was able to hold so many shares of Digital UK at the beginning was that the BBC itself gave up most of its holdings in the company.

The reason is that after the original ITV Digital failed to compete with SBSky on the path of terrestrial digital TV, leading to bankruptcy, although the BBC took over part of ITV Digital's terrestrial digital channels at the request of the British government, they had no plans for terrestrial digital TV. I don’t have much confidence in the development of technology, and I don’t want to invest too much energy in it.

What's more, according to the commitments made to the government when the BBC and SDTV took over the three ITV Digital channels respectively, Digital UK needs to invest at least 100 million pounds per year in the next five years, with a total of no less than 500 million pounds. in the development of terrestrial digital television.

This number is also difficult for the BBC to accept, or they simply do not have much willingness to invest so much money in the development of terrestrial digital television.

Therefore, when the two joint ventures finally established Digital UK, a company used to promote terrestrial digital television and launch the Freeview platform, the BBC took the initiative to give up most of its shares and only held 40% of the shares.

At that time, Barron's, the man behind SEM Group, did not have the abundant funds that he does now. It can be said that investing so much money into Digital UK was considered a desperate move in the eyes of others.

It is also worth mentioning that when ITV decided to join the company Digital UK, its development had already made great achievements and its prospects began to be promising.

Because of this, when iITV joined, the BBC also restricted the proportion of shares that ITV could obtain. In the end, ITV invested 150 million pounds and obtained 15% of Digital UK's shares. This was not what they originally expected. They invested more funds and obtained more than 25% of the shares.

Now the number of users of the Freeview platform has exceeded 12 million, making it the largest digital TV broadcast platform in the UK, far surpassing Sky TV - although Sky TV's channels are mainly paid, there are differences between the two.

Under such circumstances, the BBC is somewhat dissatisfied with its 34% shareholding in Digital UK. Today, the BBC president came specially from London to talk to Barron about this matter.

"If the BBC is willing to increase its investment in this company based on Digital UK's valuation and issue some additional shares to you, it is not impossible."

Barron looked at the man in front of him and said calmly:

"However, as shareholders of Digital UK, SEM Group and ITV also have the right to allocate shares in equal amounts."

Dyke, who was slightly happy at first, frowned again after hearing what Barron said next:

"Your Highness the Duke, this result will probably not change our shareholding ratio much."

"So everyone knows that Digital UK has excellent prospects, so what is the BBC going to do to convince me? You should understand that the biggest obstacle to the increase in the BBC's shareholding ratio is not us, but ITV."

"But you have a controlling stake and if we can reach an agreement, ITV's objections will be invalid."

After hearing what Decker said, Barron laughed:

"So how do I get motivated to do this?"

"Perhaps, Your Highness the Duke, we can promote the IPO of Digital UK..."

Seeing Barron's questioning eyes, Dyke continued:

"This is a good thing for both Digital UK's financing and the determination of the company's value."

"But in fact, Digital UK has not yet achieved profitability."

"This is very simple. In terms of profitability, you only need to increase the fees on the Freeview platform."

After hearing the other party's words, Barron slowly came back to his senses...

After working on it for a long time, it seems that the BBC is really targeting ITV?

Although according to media reports, the BBC's financial situation during this period is not good, ITV's financial situation is not as good as the BBC...

Speaking of which, if SDTV were not supported by Summit Media, it would still suffer losses...

Barron was a little surprised at first, how could the BBC suddenly become rich and want to increase its stake in Digital UK at this time...

After working on it for a long time, their purpose is to increase the fees charged by the Freeview platform to the TV stations that broadcast on it. This will also increase the financial pressure on ITV.

But this is a double-edged sword. It will also have an impact on the BBC, but the BBC can always survive, but ITV may not...

Is it necessary for these two families to be so tit-for-tat?

Barron did not expect that as the competition between the BBC and ITV intensified, SDTV, a subsidiary of his SEM Group, could also be regarded as a catfish.

After all, SDTV has grabbed a large piece of the cake in many fields, especially the field of variety shows, so the competition for the remaining cake will naturally become more intense.

"I still need to think about it. I believe there will be a result soon."

In the end, Barron politely saw off BBC CEO Dyke first.

As for the BBC’s proposal…

It doesn't seem impossible.