The obstacles facing public service broadcasters are akin to a "perfect storm", as Sky is now dominating the Irish television market with 43 per cent of the total income, RTÉ news and current affairs managing director Kevin Bakhurst said yesterday.

Sky captured some €382 million of the €879 million in total revenues in 2011 - some €157 million more than RTÉ's €225 million take, Mr Bakhurst said in Galway-Mayo Institute of Technology (GMIT) yesterday.

That was two years ago, “well ahead of the digital switchover”, Mr Bakhurst noted in his public lecture at the GMIT campus in Galway.

Recent figures show 58 per cent of all television revenue is now collected by subscription, he said, and this posed a “real challenge” to RTÉ and public service broadcasting, he said.

“Public service broadcasters across the world face similar challenges to those faced by RTÉ, and it would be wrong to understate those,” he said.

When organisations like RTÉ or the BBC were set up nearly a century ago, he said, they were simple radio broadcasters in small isolated markets with a captive audience. In Ireland, RTÉ’s radio service had its own way from its beginnings in 1926 until everything changed in 1961, “when the market became more complicated with the arrival of the new kid on the block: television”.

RTÉ had had its own way in Ireland for over three decades until the advent of commercial radio in 1989, and the launch of Ireland's first commercial TV broadcaster, TV3, in 1998. "Still, even then, the Irish broadcasting marketplace looked pretty uncrowded," he said.

“Even as recently as 1998, the complexity and level of competition of today’s broadcast market was unthinkable. The arrival of the internet and the opportunities that followed brought another wave of change. Then, for the broadcasters, technology swept away the protection offered by the Irish Sea and delivered multi-channel television to Ireland, with digital switchover complete last year,” he said.

For the Irish audience, choice has never been better or greater, he added. Television could now be delivered by satellite, cable or digital terrestrial. “You can choose from over two hundred channels,” he said.

In such a crowded marketplace, RTÉ had to fight for audience and battle for income, at a time when there had been a significant fall in commercial income.

“RTÉ needs to maintain a critical level of audience to justify future public funding,” he added, referring to television. “That means creating enough compelling content to persuade our audiences to stay with us – when budgets for doing so are under more pressure than ever.”

The news chief noted the competition in the multimedia marketplace from national and international stations, radio and web operators such as Youtube.

RTÉ had reduced operating costs by €125 million between 2008 and 2012, with 500 people leaving the organisation, he said, and no organisation would “find it easy losing that amount of experience”. He had been at one farewell function for 15 people with an accumulated 400 years of experience.

RTÉ was “relentlessly focused” on audience, as in its licence-fee payers. He noted successes such as the recent GAA finals having secured over 60 per cent of the total television audience, while the new series of Love/Hate was attracting around 55 per cent and the RTÉ Six-One News was commanding 40 per cent of all viewers available.

“ RTÉ Digital has rapidly created new popular services such as the RTÉ Player,” he said, while the mobile News Now App had been downloaded over one million times.

The proposed public service media charge was “in line with some of that new thinking in Finland and Germany”, he said, promising a “more efficient and future-facing way of funding that content”.

Mr Bakhurst said he remained optimistic about the future of public service broadcasting, and noted that in his view it would have been “disastrous” for news coverage and RTÉ as a whole if the station had closed a number of its regional offices - a situation it faced over a year ago when he was appointed.

“So we considered innovative ways of staying, of using new technology and creating new partnerships in the regions - in some cases moving into Institute of Technology (IT) premises, in others working with the ITs on a range of other initiatives,” he said. This had helped to cut overheads and costs and “deepen” relationships in the regions.

The RTÉ Galway studio, which was to have transferred to GMIT, has been retained in the city centre.