BBC, Microsoft Sign Strategic Alliance

Though the details remain sketchy at present, officials from the BBC and Microsoft at a high-profile, if low-detail, press tour conducted yesterday, signed what's being described as a "memorandum of understanding" that may spell out the terms under which the two companies work together to build what the BBC describes as a "radically re-invented Web site in the Web 2.0 world."

"To ensure that the BBC is able to embrace the creative challenges of the digital future," BBC director-general Mark Thompson stated this morning, "we need to forge strategic partnerships with technology companies and distributors for the benefit of license payers."

By "license payers," Thompson is referring to viewers who, in the world of British television, pay licensing fees for the right to receive BBC content.

As the BBC moves more of its focus away from the "cable broadcasting" model that are at the roots of the company, one of its key challenges is to be able to utilize the Internet without finding itself giving away all its content. Although the BBC is an agency licensed by the British government, whose licenses are regulated by law, it is a for-profit corporation.

Thompson's reference to "license payers" is perhaps the most telling clue we have with regard to the BBC's plans, which may involve extending end-user licenses to Internet-based content.

Both companies made clear that their agreement was non-exclusive. While Microsoft now has an option to sell off its remaining 18% stake in MSNBC in 2007, under an agreement signed last December with majority owner NBC Universal, it may wish to continue some kind of strategic alliance where it continues to provide services, at least to MSNBC.com. A non-exclusive deal with the BBC leaves Microsoft free to pursue that option.

"The memorandum of understanding aims to identify areas of common interest between the BBC and Microsoft on which a strategic alliance could be developed," this morning's statement reads. However, it adds that if the BBC wishes to procure any new technology from Microsoft, as for all procurements by the Corp., it would need to seek regulatory approval.

Microsoft is in the process of providing more and more "Web 2.0" functionality tools to Web site developers for free, including its newly renamed ASP.NET AJAX Extensions, formerly known as "Atlas." In turn, it may be interesting to learn what new technologies, if any, that the BBC may have a chance to premiere first. BetaNews has contacted Microsoft for further comment, which may yet be forthcoming.