BBC chairman Richard Sharp had plenty to chew over. Perched next to Channel 4 boss Alex Mahon, the former Goldman Sachs banker joined hundreds of guests for a dinner to round off the first day of The Royal Television Society's Convention in Cambridge.
Sharp had surprised Mahon earlier on Wednesday by playing down the privatisation of Channel 4 as a "local issue" compared to the global threats facing British broadcasting.
Yet by the time the wine was poured in the King's College dining hall, his provocative remarks had been overtaken by events with direct implications on him.
Nadine Dorries – the BBC sceptic and former I'm a Celebrity … Get Me Out Of Here contestant – had replaced Oliver Dowden as Culture Secretary in a surprise reshuffle by the Prime Minister.
For Sharp and his director general Tim Davie, the appointment made for bad timing. It will prove an early test of their leadership.
Having seen off decriminalisation of non-payment of the licence fee – and calls to fund the corporation through a subscription service – the pair were just days away from a five-year deal with ministers to either freeze or increase the licence fee at just below inflation.
Though the latter would herald less money in time, it is understood to be a favourable outcome. Doing so would calm tensions between the corporation and the Government over accusations of Left-wing bias, as well as reactions over the decision to scrap the licence fee for the over-75s and corporate governance concerns prompted by the Martin Bashir scandal.
Sources say Dowden had been sitting on the decision for weeks and was poised to make an announcement when he was suddenly shifted into the new role of co-chairman of the Conservative Party.
Now, Sharp and Davie risk being dragged back to the negotiating table. Dorries is a fierce supporter of Boris Johnson who has branded licence fee funding as "outdated" and thrown her weight behind decriminalisation campaigns.
Sharp is a Brexit supporter and former Tory party donor: his political leanings were intended to smooth relations between the BBC and Downing Street.
His commercial acumen as a former investment banker was seen as an asset to Auntie as it seeks to wean itself off an over-reliance on the licence fee by bolstering income through its commercial arm, BBC Studios.
Yet his comments about the £159 annual levy during an interview at RTS suggest he could be heading for a collision course with the ex-reality TV star and junior health minister.
Sharp argued the corporation was still an "incredible asset" that only cost a household 43p a day for access to a slew of TV, radio, online and iPlayer services.
"There needs to be a national utility that delivers insight, education and children's [broadcasting] and these other assets at a price point people can afford. And we can do so because [the licence fee] is imposed."
Asked how damaging a below-inflation licence fee settlement would be, he responded: "There would be a hole in my budget. Because of the demand for [TV services] media inflation is going up by about 9pc.
"Tim and his team have taken serious costs out of the business already – the low hanging fruit is gone. There would be serious consequences for a poorly funded BBC."
Keeping ministers at bay will partly depend on how quickly Sharp and Davie can turbocharge returns generated by BBC Studios, the corporation's trading arm. Its main thrust comes from selling the overseas rights to its biggest hits: series such as Doctor Who, Top Gear and Strictly Come Dancing have proved successful money-spinners.
In a bid to further bolster its commercial cloud amid threats posed by the likes of Netflix – and dwindling numbers paying for a TV licence – four years ago it merged the trading arm and BBC Worldwide, its distribution unit.
Of the corporation's £4.94bn income in 2019 to 2020, a £3.52bn chunk came from the licence fee – marking a fall of £170m compared to the year before.
Meanwhile, Davie is still on track to reach his five-year target of growing BBC Studios' returns by a third to £1.5bn from 2022 to 2023. On top of his financial targets, the director general has urged ministers to increase the debt limit enforced on BBC Studios from £350m to £500m, to help it compete with huge spending by the American streaming platforms.
The future may be encouraging but it is not without its challenges. Over a year has passed since Davie was promoted to director general, yet the organisation has still failed to find a full-time replacement. While interim chief executive Tom Fussell has support within the organisation to take the role full time, Sharp has urged Davie to cast the net wider in the hope of landing someone with global media experience.
That search is proving tough, however, as the corporation struggles to compete with the huge salaries offered by tech platforms increasingly turning to UK talent.
Former chief executive of ITN Anna Mallett left her position of two years to become a production executive at Netflix; Anne Mensah swapped Sky to become the streaming giant's vice president of content. Channel 4's former chief creative officer, meanwhile, joined Apple three years ago as its European creative director.
Asked about the role on the sidelines of RTS, Sharp said it was a matter for Davie. Meanwhile, Davie said the search was continuing and that Fussell was doing a "fantastic job".
Concerns are mounting, however, inside Broadcasting House that Dorries may force deeper savings on top of the £925m sought by March next year.
In a blog from 2014, she wrote that its status as a national treasure "has been overblown" and branded it an organisation "that suppressed women by promoting only men".
"A tax on the ownership of a television is a completely outdated concept that totally fails to take into account changes in the media environment over the past 50 years," she posted.
"Added to this are the enormous changes in how media is consumed that have taken place in just the last decade.
"The model of the BBC, which is in effect state-run television, is outdated in this modern world of media and communication.
"Such a structure of payment and aggressive persecution would be more in keeping in a soviet-style country."
Yet Davie moved to defuse fears when he stepped on stage for an interview at RTS: there was "always a bit of theatre" around government appointments and it was "too early to make any conclusions".
"We're on 10 culture secretaries in the last 10 years," he said. "The key thing I found is we need a really serious, grown-up dialogue with the Government to talk about what we want to do in this industry, and the BBC's place in it."
In the coming days, the corporation will have little choice but to play a waiting game. "We have not had any signals yet as to whether we are starting again or we are about to [do a deal]," a source said.
Claire Enders, of Enders Analysis, said a deal baked into an inflationary rise of 2.5pc a year "would be a very good day for the BBC, Richard Sharp and Tim Davie", adding that it would be a £25bn deal.
Dorries, however, has it in her power to take a different recommendation.
"I think we are in some kind of suspense. And the simultaneous disappearance of Dowden and media minister John Whittingdale is not a good day for the BBC. Those two were very heavily involved in that negotiation," she added.
In the meantime, Sharp, Davie and the BBC's chief operating officer, Leigh Tavaziva, will need to steel themselves when facing questions from the culture committee on Tuesday over licence fee evasion, staff pay and senior editorial appointments.
In a turbulent year that has heaped strain on the BBC's relationship with government, Sharp and Davie will have taken some cheer from avoiding the worst of the sweeping – and painful – changes aimed at its financial structure.
Yet as Dorries eases herself in the role in the coming weeks, they may find their biggest battle has barely even started.
- What’s on TV This Week: ‘Curb Your Enthusiasm’ and ‘Queens’
- Black Powerlist 2022 led by Michaela Coel and Man Utd's Marcus Rashford - see full list
- Strictly Come Dancing: Karen Hauer eliminated next as expert warns ‘not looking too good'
Nadine Dorries's comeback risks culture clash with BBC chairman Richard Sharp have 1440 words, post on www.telegraph.co.uk at September 18, 2021. This is cached page on Europe Breaking News. If you want remove this page, please contact us.