Channel 4 mulls merging with BBC Worldwide

British broadcast major Channel 4, which runs the famous Big Brother realty series, is looking at merging itself with rival BBC Worldwide to avoid a possible bankruptcy, media reports said today.

"The deal being discussed by regulators and ministers would see the creation of 4 Worldwide," the Times reported, adding that the merger would generate 100 million pounds a year that Channel 4 needs to survive.

"The creation of the hybrid broadcaster would represent a huge financial sacrifice for the BBC, but would help Channel 4 to pay for expensive public service programmes such as the nightly news fronted by Jon Snow," the report added.

The report added that the plan being talked over the past few weeks would involve Channel 4 running the business with a minority stake held by BBC.

Both broadcasters are publicly owned, although Channel 4 funds itself through advertising.

"Any merger would have to overcome opposition from within the BBC, which is reluctant to lose control of Worldwide, which made profits of 112.5 million pound last year," it said.

Channel 4, set up in 1982 by the Thatcher government as an alternative to the BBC and ITV, is still profitable, but believes that it risks "going under in the next five years." The channel thinks it can no longer generate enough advertising to support "distinctive" mix of programming, the report said.

According to the Times, communication sector regulator Ofcom estimates that Channel 4 needs between 50-100 million pound a year to survive the next decade. However, Channel 4 says it needs up to 150 million pound a year to keep afloat.

The daily noted the loss of viewers puts pressure on advertising income, which has also been hit by recession and is likely to have fallen by 5-6 per cent this year.