Under the new plan, the government has said it will move forward legislation to modernise the licence fee next year. This could include changing how the BBC's iPlayer catch-up service operates, which may include charging for content and no longer making it a criminal offence if people don't pay.

The move was expected to be announced by Chancellor George Osborne in the Budget on Wednesday, but was brought forward to address early rumours. According to reports, the BBC could lose up to £650 million by covering the fee, which equates to around a fifth of its (already frozen) budget.

In an interview on July 5th, Osborne told the BBC's Andrew Marr that the BBC had become more "imperial in its ambitions," which could negatively affect newspapers. By delivering more features and guides on things like cooking, Osbourne says the BBC website is becoming "the national newspaper as well as the national broadcaster." These points are also being discussed as part of the BBC Trust's Charter Renewal, which is expected later this year.

According to the Culture Secretary, the BBC is satisfied with the deal. However, the opposition isn't backing the changes. Shadow culture secretary Chris Bryant said the move was "no way to run a whelk stall let alone the world's most respected broadcaster".