Less than two weeks before the selection process starts at the beginning of October, Gardam is said to have suggested that he has pulled out of the running for personal reasons.
The task of finding a new chief executive was sparked when Michael Jackson resigned in July.
Jackson is to join USA Networks headed by CEO Barry Diller. He is joining USA Entertainment -- part of USA Networks of which the Sci-Fi Channel is a division.
Gardam had been the favourite internal candidate to scoop the post. With him out of the running and the likelihood that managing director David Scott will be involved in the selection process, the job will likely go to a candidate from outside the broadcaster.
TV producer Peter Bazalgette has been tipped as an early favourite although Dawn Airey, the Channel 5 chief executive, has not yet ruled herself out of the running.
Another strong contender could be BSkyB chief executive Tony Ball, who has expressed an interest in the post although he is believed to be unlikely to leave the satellite broadcaster.
There has also been suggestion that Rupert Murdoch, the chairman of BSkyB parent News Corporation, could have him lined up for a post in the US if he pulls off his deal to acquire US satellite broadcaster DirecTV.
Jane Root, director of BBC2, is said to have applied for the job, as has Telewest managing director of broadband David Docherty.
Mark Thompson, the BBC's director of television, is said to be considering the position. It is widely expected that he will stay at the corporation in order to challenge Greg Dyke when his term as director general expires in 2004.
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