Mr Kaufman said many see the BBC as just one of many broadcasters

Culture select committee chairman Gerald Kaufman said it was time for the BBC to "transform" itself.

Unless it does so it will be unable to justify "its very special place as a recipient of the charter", he said.

But Lord Burns, leading the review, said the BBC continued to play an "important role" in viewers' lives.

'Means nothing'

The charter review will advise the government on whether the BBC should keep its licence fee after the corporation's current charter expires in 2006.

Mr Kaufman told Tuesday's committee meeting: "There is no doubt that what we may call the general middle classes love the BBC.

"But when I came in today there was a young man standing outside listening to music on his headphones.

He may well have watched the (football) match on the BBC last night simply because that was the only channel it was shown on Gerald Kaufman MP

"My guess is that the BBC means nothing to him except as a source of some of the things he might possibly want to see.

"He may well have watched the (football) match on the BBC last night simply because that was the only channel it was shown on."

Lord Burns replied that evidence collected by the government inquiry so far suggests that "some people like the BBC, some people like it a lot".

'Derivative'

Some members of the public are concerned about "derivative formats and too much copycat type of programming," he said.

But he added: "I do not sense that the worries and concerns people have about the BBC at this stage are leading them to turn away from the important role that people feel it plays in their lives."

MP Derek Wyatt suggested reducing the 10-year duration of the next royal charter, in order to monitor how the BBC adapts to changes in broadcasting.

"You seem to have two competing problems - new technology that could lead to a different way of receiving television, and government demands to move from analogue to digital," he said.

But Lord Burns was "hesitant" about supporting a shorter charter period, concerned that it would put the BBC in "a constant state of review".