The number of households tuning in to the BBC's TV channels each week has fallen by half a million over the last year.
Figures published yesterday showed the number of viewers watching the BBC for at least 15 minutes a week was down to 87.9 per cent for the year to date, compared with 89.9 per cent over the same period in 2004.
The decline reflects the rapid growth of multi-channel television - now in 15million homes - and the burgeoning popularity of other forms of home entertainment, such as computer games and the Internet.
BBC bosses have long insisted that "reach" - that is, how many people tune in to its channels for a least 15 minutes a week - is a more important measure than "share", the proportion of people watching its programmes at any one time.
However, with more than 60 per cent of households now having multi-channel television, such as the BBC-backed Freeview service, the audience share of the BBC's main channels has also fallen sharply to around 35 per cent.
BBC1 and BBC2 suffered the biggest ratings decline of the five main terrestrial channels. Both saw their average audience share drop by about six per cent between January 1 and November 14 - compared to the same period last year - to 23.3 per cent and 9.4 per cent.
Although BBC1 in particular usually enjoys a strong Christmas, this is unlikely to make much difference to the overall audience decline over the year.
There was bad news too for ITV1 - which saw its audience share down by 5.7 per cent.
Both BBC1 and ITV1 will take solace from the success in reviving family viewing on Saturday nights with hit shows such as Strictly Come Dancing, Dr Who and The X Factor.
Channel 5 has also suffered a slight decline in its audience share for the first time since it launched in 1997, although it attributes that to its more upmarket programming.
Channel 4 progress
Meanwhile, buoyed by its coverage of the Ashes series and Big Brother, Channel 4 has been the only terrestrial channel to hold its audience with a share of 9.9 per cent so far.
The latest figures reflect the relentless rise of digital TV. Multi-channel services such as ITV2, Sky One and E4 have seen their audience share climb to 29.5 per cent, compared with 26 per cent last year.
Industry experts say the figures raise fundamental questions for all broadcasters.
One source said: "As its audiences get smaller, people will increasingly ask whether the licence fee is justified, as well as how long advertising-funded channels like ITV can survive."
Although the BBC's main digital channels have continued to grow - BBC3 and BBC4 recorded their best months in October - it has not made up for the decline of BBC1 and BBC2.
Taken together, the BBC channels - including CBBC, Cbeebies, News 24 and BBC Parliament - have seen their audience share fall four per cent. By contrast, ITV1's decline was just about offset by the success of its new digital channels - ITV2, 3 and 4
Let the fans of the BBC pay for it themselves I say