Jowell: Turned down plans for BBC Three

Mr Davies, 50, whose promotion was widely predicted, began his five-year tenure with a series of meetings on Monday.

The former economist will head the BBC's board of governors and provide a link between the corporation and government.

The BBC's digital expansion will be one of the main issues within the corporation during the next five years.

In September, Tessa Jowell gave the go-ahead for three new digital TV services and five new digital radio stations.

But she rejected proposals for BBC Three, which was to be a relaunched version of BBC Choice, because it would be too similar to others already available.

New measures

"We strongly believe that BBC Three - a channel for young adults - is badly needed," Mr Davies said after his appointment, signalling his determination to get the decision overturned.

Other possible moves could include subjects that were proposed when he chaired the review of BBC future funding in 1999.

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That report suggested an additional licence fee for digital television.

It also said BBC Worldwide should be privatised, and he joins after a period when the BBC has been looking for new ways to expand its commercial revenue.

Scrutiny

Mr Davies is also expected to try to keep the BBC out of the reach of Ofcom, the new over-arching communications watchdog.

The BBC is currently regulated by its 12 governors.

Mr Davies' performance is likely to come under external scrutiny after his appointment was criticised on charges of Labour "cronyism".

As a close friend of Chancellor Gordon Brown and former government advisor, Conservatives and some within the industry have voiced their concerns that the links may be too close.

But he has promised that the BBC "is not at risk in any sense whatsoever".

He would stand for "lack of bias, impartiality, neutrality and reflecting our political system in its broadest sense", he said.

The first advertisements for the job of vice-chairman went in the press on Sunday, and Mr Davies's deputy will be appointed within the next three months.

David Mellor has been mentioned as a possible deputy

But the government has rejected speculation that the deputy will be a Conservative, despite the fact that both chairman and director general are both known Labour supporters.

The vice-chairman will be chosen by the same "open and transparent" panel process that chose Mr Davies.

"It's merit-based, and we'll get the best person for the job," a spokeswoman for the Department for Culture, Media and Sport told BBC News Online.

Previous convention had seen the deputy's job given to someone with the opposite political leanings to the chairman.

Former Conservative ministers David Mellor and Michael Portillo have both been mentioned as possible candidates.