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Channel 4 chief executive Andy Duncan confirmed at the Edinburgh International Television Festival that the broadcaster is looking at forging links with the BBC in certain areas, casting doubt on speculation that C4 is on course to join forces with Five.

Speaking at a session on public service broadcasting, Duncan told delegates to the conference: “It is the case that I’m interested in talking to the BBC. But I’ve obviously come into a situation where Channel 4 is doing very well at the moment.

“The heart of my challenge is to see how we can make sure it can carry on fulfilling its role. I’m going to be looking at a wide range of strategic options.”

At the same session, Five chief executive Jane Lighting indicated that any discussions between her company and C4 were still at a very preliminary stage.

“There’s been a lot of news around this and a huge amount of speculation – frankly jumping to all sorts of conclusions – and the reality is that nothing is as far thought through or discussed as people imagine it is,” she said.

Duncan, formerly the BBC’s director of marketing, communications and audiences, noted that a tie-up between BBC and C4, which is also owned by the government, made good sense.

“Ultimately, the purpose of those two organisations is a purely public one,” he explained.  “This year Channel 4 has had commercial success. We haven’t then handed £20 more to shareholders. We put £20m more back into the programme budget to bring forward drama, comedy – top up next year’s budget.”

Duncan added: “If you go forward over the next 10 years when we move to a fully digital world, you could see there will be challenges that both the BBC and Channel 4 face, in terms of continuing to provide some of that public service programming, when there’re greater competitive pressures. There are clear areas where mutual cooperation could actually help in terms of saving money or help us be more effective,” Duncan said.

He gave education as one area of potential co-operation where some back office functions could be handled together in way that would save both money.

“The heart of what Channel 4 will be doing is about providing something different to the BBC,” he added, noting that that doesn’t mean the two broadcasters can’t work together in commercial areas, education, new media.

“Channel 4 can definitely work with the BBC and piggyback on some of the technical development work that they’ve done,” he said.

Duncan made clear, however, that a link-up with Five had not been entirely ruled out: “I am interested in Five as I’m interested all the potential options.”

At another session, BBC director general Mark Thompson was asked if the BBC would be looking at co-operating with other broadcasters in foreign markets such as the US: “I’d welcome a dialogue with Andy from Channel 4 and other PSBs to see whether we could get together more,” Thompson said.

“We may well be dealing with a period of consolidation in channels both in the UK and around the world,” he added.  “We can certainly look at all those options.”

For his part, ITV chief executive Charles Allen expressed doubt that Five and Channel 4 could affect any sort of merger.

“I don’t understand how you put a Government-owned entity and a commercial entity together when, in fact, they actually are quite different animals,” he said.  “I don’t see how that works. But I think it comes back to the debate on what you want them to do from a PSB perspective.”