On 18 October 1922, the British Broadcasting Company, Ltd. was incorporated under the 1908 to 1917 Companies Acts with a share capital of £100,000., with 99,993 cumulative ordinary shares valued at £1 each:
The holders of the Cumulative Ordinary Shares are entitled to receive out of the profits of the Company a fixed Cumulative Dividend at the rate of 7½% per annum on the capital for the time being paid up thereon but are not entitled to any further or other participation in profits.
On 14 December 1922, John Reith was hired to become the Managing Director of the company at that address. The company later moved its offices to the premises of the Marconi Company.
The British Broadcasting Company, Ltd., was formed using a blueprint that the US Navy and the General Electric Company had attempted to institute in the USA.
Early in World War I, all of the ship-to-shore and transatlantic radio stations controlled by a US subsidiary company of Marconi's Wireless Telegraph Company, Limited in Chelmsford, England, were seized and handed to the US Navy for the duration of the War.
After the War, the US Congress forced the US Navy to divest itself of the stations and they turned to the General Electric Company which in 1919 formed a subsidiary called the Radio Corporation of America (RCA). With the US Navy on its board, RCA then absorbed the former Marconi stations.
In 1926 RCA created the National Broadcasting Company, the first network in the United States.
Peaking in the 1930s, there were attempts to bring all radio communications in America back under single monopoly control by using the patent laws. This move failed. However, it was against the backdrop of these developments between 1922 to 1927 in which the original British Broadcasting Company. Ltd. was formed and then merged into a Crown corporation, in part to sever the influence of the General Electric Company in the USA.
The General Electric Company, Ltd. (GEC) in Britain, which was represented on the board of the BBC, had ties to General Electric International, which was a subsidiary of the General Electric Company in the USA. The Western Electric Company. Ltd., in the UK was originally formed as a subsidiary of American Telephone and Telegraph Company (AT&T) in the USA where it served as its manufacturing subsidiary to equip the AT&T Bell Telephone system. Metropolitan Vickers Company, Ltd., was originally formed as the British Westinghouse Company.
Westinghouse and AT&T were both represented in RCA. British Thomson-Houston Company, Ltd., was a controlled UK subsidiary of the General Electric Company in the USA. The Hotpoint Electric Appliance Company, Ltd., was formed by British Thomson-Houston (BTH) in 1921.
The only other company later added to the original shareholders of the British Broadcasting Company, Ltd., was Burndept Limited. It represented the interests of over 20 small electrical manufacturers in the UK.
Income
The British Broadcasting Company Ltd., did not sell air time for commercials but its license did allow for it to carry sponsored programming, and eight such sponsored broadcasts were aired in 1925. However, the main source of its income was from the sale of radio receiving sets and transmitters manufactured by its shareholding member companies as well as from a portion of the government (GPO) license fee that had to be purchased by BBC listeners.
On 31 December 1926, the company was dissolved and its assets were transferred to the non-commercial and Crown Chartered British Broadcasting Corporation.
