Back in August, the BBC sent a quiet notice to Ofcom asking for permission to cripple the next generation of digital television broadcasts. The BBC had apparently been meeting "third party content owners" who had "made it clear" that they expected the corporation to find ways to violate the regulation that forbids it from encrypting free television, and it thought it had found a way.

Some background: licence-fee-paid television must be free to receive in the UK. Unlike cable and commercial satellite signals, free-to-air television is carried on public airwaves, which broadcasters are allowed to use for free. In return, broadcasters are expected to provide programming on those airwaves, for free. And not just free as in "free beer", but also free as in "free speech." The terms and conditions for free-to-air telly are "Do anything you want with this, provided it doesn't violate copyright law."

But big rightsholder groups – US movie studios, mostly – object to this. They'd prefer a "copyright-plus" regime, in which they get to invent a bunch of new copyrights for themselves, without the inconvenience of public debate or parliamentary lawmaking. The way they do this is by slapping restrictive licence agreements on their media, or rather licence "agreements," in inverted commas. You don't get to negotiate these "agreements," they're imposed on you, and are sometimes even invisible to you.

These rightsholder groups have a long history of trying to arm-twist the BBC into imposing restrictions on the TV that you and I are obliged to pay for. For years, the BBC broadcast its satellite feed in encrypted form, paying an additional £20m a year to run this scheme. When the BBC decided that it was unseemly and wasteful to go on paying for encrypted satellite signals, the major studios promised a boycott of the corporation. The boycott was short-lived: as soon as the quarterly results came in with a massive BBC-shaped hole in the studios' income, they recanted.

After this, the studios went after Europe's public broadcasters (including the BBC) by trying to create a restrictive standard for limiting what sort of equipment Europeans could use to receive, record and use free-to-air broadcast signals. This standard, DVB CPCM, fell apart after years of acrimonious negotiation.

Now it's back. As the BBC readies itself to begin free-to-air high-definition broadcasts, it has petitioned Ofcom for permission to encrypt part of the broadcast signal – specifically, the data-channel that contains instructions for decoding and playing back the video. The corporation argues that because it isn't encrypting the actual video (just the stuff that makes it possible to watch it) that it isn't violating the rule against encrypting its programmes.

The encryption keys necessary to decode BBC programmes will be limited to companies that agree to the terms set out in the Digital Transmission Licensing Administrator agreement, something created by a bunch of non-UK companies in co-operation with the Hollywood studios. This agreement includes requirements to encrypt any stored programmes and any digital outputs on the device, so that anyone who wants to make a device that plugs into a DTLA-licensed box will also have to take a DTLA licence. It's a kind of perfect, airtight bubble in which all manufacturers are required to limit their designs to include only those features which make the big studios happy. These limitations – on recording, storing, and moving programmes – are not the same as "what copyright allows". Rather, they are, "what makes the movie studios comfortable".

I'll say it again: the public's deal with the BBC is: we pay you the licence fee, you give us programmes, we can do what we want with them within the confines of copyright law. The studios promised that they would boycott US free-to-air television unless they got a version of this (called the "Broadcast Flag"). They didn't get the Broadcast Flag, and they didn't boycott. They have shareholders to answer to, and those shareholders won't put up with corporate tantrums that promise no licensing revenue until the rest of the world rearranges itself to the company's convenience.

DTLA requires that all devices be made to "resist end-user modification". That is, DTLA devices can't use open-source software, lest the pesky licence-fee payer alter the restrictions in the code.

Now, this won't stop piracy. It won't even slow it down. DTLA devices will have imperfect implementations. These will provide gateways by which piracy-minded users can extract the video and put it on filesharing sites. That much is a given – even the BBC admits it in its Ofcom petition ("no system provides complete deterrent to determined hackers" – translation: this won't stop pirates, just honest users trying to do everyday things).

But what it will do is:

• Freeze out British entrepreneurs, such as the manufacturers of the Promise TV, who produce video recorders that run on open source software.

• Make all British tech firms and their users subject to the whims of the DTLA and its certification body, which is outside of Ofcom's regulatory sphere – trading a responsible British government regulator for an untouchable offshore inter-industry body.

• Increase the cost of receiving HDTV in the UK, because EU imports won't work here, limiting competition.

• Generate a mountain of e-waste, because manufacturers won't be able to produce set-top boxes that downsample the HD signal and feed it through a digital output to existing SD tuners and recorders.

• Break existing equipment, such as HD laptop cards that have open drivers. And, most importantly,

• Violate the BBC's duty to transmit clear signals to the licence-fee paying public.

The BBC's cosy negotiation with big rightsholders and offshore manufacturers excluded the public and the free/open source software community – the very groups that blew the whistle on previous attempts to lock up the public airwaves. It's almost as though it wanted to limit the "stakeholders" in the room to people who wouldn't cause any trouble, so that it could present Ofcom with a neat and tidy agreement with no dissenting voices.

If the BBC seriously believes that it has the right to cripple licence-fee-paid TV signals, it can't do it through a secretive consultation. Such a gigantic sea-change in the BBC's direction – bigger than iPlayer, bigger than digital broadcast – needs to take place in the public eye, with everyone at the table. Ofcom should send back the BBC's petition with a failing grade – "See me after class".