As expected, BBC director general Mark Thompson has gone on the attack against the Murdochs and News Corp. He warned that Sky will shortly become Britain’s biggest broadcaster and said such a concentration of cross-media ownership would not be allowed in the U.S.. Thompson blasted Sky for spending so little on original programming and pointed out that the £100 million it spends each year is not much more than Channel 5’s UK programme budget. This is despite Sky’s £5.9 billion turnover being more than 15 times that of Five’s.

Thompson also used his keynote Edinburgh TV festival speech to single out News Corp for weakening and undermining the BBC. At times, he evoked playwright Dennis Potter’s fiery 1993 Mactaggart lecture pouring bile on Rupert Murdoch. Thompson defended the BBC as an idea of “public space”, one which “would not put anybody on the wrong side of an encryption wall”. Thompson criticised the Murdoch press for chipping away at the BBC trying to uncover some new petty scandal. Stories attacking the BBC were ramped up, distorted or just plain nonsense, Thompson said. One reporter cheerfully admitted to him that his newspaper bosses were just out to get the Corporation. The free-marketers have spent the last 25 years making a case for abolishing the BBC, said Thompson, yet public support for the Beeb has actually increased.

“Enemies of public service broadcasting always want to atomise it, to split so-called market failure genres which may deserve public funds from so-called commercial ones which definitely don’t,” he said.

Thompson ridiculed James Murdoch for attacking national treasure the British Library following his anti-BBC speech at last year’s Edinburgh TV fest. “The British Army? The British Cheese Awards? Who knows where he’ll strike next,” Thompson said to audience laughter.

He also poked fun at Rupert Murdoch for arguing that U.S. cable companies should pay something for carrying Fox in the States. Why shouldn’t Sky be paying UK public service broadcasters including ITV and Channel 4 carriage fees?, Thompson asked. They are, after all, the most popular channels on the satellite broadcaster. Based on what Murdoch senior reckons US cable operators should be paying for Fox, UK broadcasters would earn a £150 million annual windfall.

At times, Thompson’s speech felt aimed at Culture Minister Jeremy Hunt, who was listening in the audience, to at least keep the £3.5 billion licence fee intact rather than cut it as expected. He also made some questionable assertions, such as talent agents supporting the BBC’s new drive to pay stars as little as possible.

Thompson also used his keynote speech to announce that the BBC would be developing a pay version of the BBC’s on-demand iPlayer. U.S. viewers will be able to watch any BBC programme whenever they want within one year.