The depth and breadth of the BBC’s free online offering is often cited as a major barrier to commercial operators charging for online news.

“I feel for newspapers. What has been been suggested is to get behind a paywall – I totally understand why that is a good idea,” he told the Australian newspaper in Sydney.

“There is still a need for high-quality journalism, you just need to make sure it is available on all the other (distribution) outlets – print might decline but those other areas are going up.”

Smith praised Murdoch, the chairman and chief executive of News Corporation, for championing the “importance of having quality content”.

“Then colonising every bit of internet and charging people for it sounds like the right strategy, but it will be tough,” he said.

Smith said it was easy to talk about the decline in newspapers. “But I just think News [Corp] in particular have been very bold and brave and surprised people with all sorts of things over the years,” he added. “People said satellite broadcasting in Britain wouldn’t work, and look at it now: it’s been phenomenally successful.”

BBC Worldwide has launched two paid-for iPhone applications, one for the Radio Times and one for its BBC Good Food festive recipes guide. But the division has no immediate plans to charge for online content.

“BBC Worldwide does not have any plans for a paywall for any of its sites at present. However, it will watch closely as the market develops and ensure it has the appropriate revenue model in place,” a spokeswoman said.

Mark Thompson, the BBC director general, said last month that there would be no paywalls on the BBC public service broadcasting websites.