Why doesn't the BBC diversify?

Cornucopia

Unfortunately, and although it is widely misreported in the Media, the BBC does not have £1.3 bn of unfettered commercial profit.   Last year it had £240m, and other years a similar amount.    (£1.3bn is turnover, and does not include substantial costs).

I assume that there is nothing untoward in this approach, and it is simply a feature of the standard way to report the balance sheet of a wholly-owned subsidiary (BBC Studios).   

Bigphil1474

As I said, £1.3bn commercial revenue. Not sure the BBC is looking to make a profit as such, and the issue is where does the BBC's revenue come from - presumably they make spending decisions based on revenue availability, not on what their profit margin needs to be unlike other commercial broadcasters.

Cornucopia

It's an interesting question, and not being an accountant, I don't know how it's supposed to be reported, but the "profit" is not from the BBC itself, but from its wholly-owned subsidiaries - mainly BBC Studios.   The purpose of that activity is to generate profit to supplement the Licence Fee, and to address the BBC's obligations for independent productions (although this is a strange definition of "independent"). 

From an intuitive end-user standpoint, the BBC has c. £3.8bn per year to spend, which includes those profits from its wholly owned subsidiaries. 

The full £5bn figure is basically turnover, and is only really relevant to accountants (and HMRC?)