To avoid the chaos experienced in America with regards to broadcast licensing, the GPO (General Post Office) decided that instead of giving licenses to the (hundreds, by 1922) of wireless radio societies who had applied they would give once license to a monopoly corporation jointly controlled by the leading manufacturers of wireless radios. That monopoly corporation was established in October of 1922 and called British Broadcasting Company Ltd.

The BBC was supposed to be funded by the royalties of wireless radios sold by the manufacturers who jointly owned it. However, because of the fact that many listeners were purchasing the less expensive unofficial radios and amateurs were making their own which meant that the royalties were insufficient for the funding of the BBC. In 1923 the Postmaster-General convened the Sykes Committee which decided to give a larger share of the split royalties between the GPO and the BBC to the BBC and in the long term, once the protection of radio manufacturers had expired the BBC was to be funded by a 10 shilling licensing fee on all wireless radios.

In 1925, because the radio manufacturers were anxious to get out of the loss making jointly owned corporation and the BBC under Director General John Reith had come to a consensus for the continuation of the BBC's monopoly the Crawford Committee was convened. The committee recommended that the BBC be be replaced by a non-commercial, Crown-chartered organisation: the British Broadcasting Corporation. While the recommendations of the committee were being considered, the 1926 General Strike broke out and the BBC became the main source of news and updates on its developments broadcast in real time to the entire nation. The government wanted the BBC to be it's mouthpiece but Reith wanted the BBC to remain neutral while he personally agreed with the government. Due to Reith's personal political view, the government gave the BBC quite a bit of independence. The seemingly unbiased presentation of both viewpoints made it a trusted source of news for supporters and opponents of the strike who were unaware that the BBC had banned broadcasts from the Labour Party and delayed an appeal for peace by the Archbishop of Canterbury. After the strike ended, Reith recited the poem Jerusalem on air to signify that England had been saved.

The handling of the crisis led the government to look very favorably upon Director-General Reith and they accepted the Crawford Committee's recommendations to turn the BBC into non-commercial Crown Corporation which came into existence on New Year's Day 1927.