The BBC is to partner with satellite broadcaster BSkyB in a bid to build a digital terrestrial television service to replace recently-collapsed ITV Digital, the London-based Timesnewspaper reported this morning.
The BBC broke ranks with a consortium including rival ITV broadcasters and Channel 4, which had been trying to form a single group to bid for the licenses left over after ITV Digital shut off services in late April, the report said.
The falling out came after the parties failed to agree on a formula on how to divide up the licenses, the Timesreported.
If successful the bid would mark the first joint venture between the BBC and BSkyB in which Mr Rupert Murdoch's News Corp holds a 36.3 per cent stake, the report said.
BBC and BSkyB will apply to the Independent Television Commission before tomorrow’s deadline for licences to run a free-to-air digital television service.
The regulator has invited applications for the licence which it took back from ITV Digital when its administrators pulled the plug on services after failing to find either the money to settle its bills or a buyer for the business.
The proposed BBC BSkyB service would be funded by a mixture of the BBC's licence fee and advertising and would be available through simple receivers costing viewers less than £100, the report said.
A spokesman for BSkyB declined to comment on the report. A BBC spokeswoman said the corporation was "talking to various people" regarding the licences application but declined further comment.
Officials at Channel 4 and ITV broadcasters Granada and Carlton Communications were not immediately available to comment.
Carlton and Granada will still apply for licences together with Channel 4, the report said.