There’s no better illustration of the difference between Nicola Sturgeon and Alex Salmond than in their attitude to the BBC.

Salmond has been engaged in what we in the political world call a “willy waving contest” with the BBC's former political editor, Nick Robinson, over who'd be most at home a totalitarian state. The ex-FM didn't start it, but he couldn't help getting stuck in.

Nicola Sturgeon struck a very different note. Before the mainly London-based media folk at the Edinburgh TV Festival on Thursday, she laid aside the megaphone and gave a thoughtful and witty performance. No histrionics or allegations of deliberate bias: just an intelligent and engaging lecture in how to create a broadcasting organisation for a new constitutional era.

The legions of SNP supporters on the internet, who believe that the BBC is the source of all evil and that Nick Robinson is the devil incarnate, will have been disappointed. But Sturgeon realises that politicians are on a loser when they attack journalists. And hurling insults, while it may make some people feel good, is a waste of time.

But she didn't try to ingratiate herself or come over all luvvie. While she conceded there was “no institutional bias”, she said BBC coverage of the referendum had lapsed into the “partial and pejorative”.

More importantly, she said that the BBC could not continue to ignore the fact that a majority of Scots, 52% - according to the BBC Trust - don’t believe that the BBC adequately represents their lives in news and current affairs. That is a dismal reflection of the BBC's performance in Scotland.

But she didn't threaten digital UDI or a boycott of the licence fee. The First Minister called for a federal structure for the BBC – which is something that has long had support from within the corporation itself - and for the devolution of the oversight of broadcasting to Holyrood.

The UK is a multinational state, and the case for reflecting this diversity in the UK public broadcasting service has always been compelling. But following the referendum and the Tsunami election, it is surely unanswerable.This has nothing to do with politicians interfering in editorial decisions.

Sturgeon also called for a dedicated English language channel for Scotland, matching the successful Gaelic language Alba. This provoked predictable forecasts of a “Nat” broadcasting corporation. But again this is nothing new. A Scottish digital channel was the main recommendation of the 2008 Scottish Broadcasting Commission.

And here's the thing: the Scottish political parties – Labour, Tory, LibDem - all voted for the SBC. It’s one of the few unanimous votes ever held in Holyrood. So it was was depressing in the extreme to hear Labour's Ken Macintosh rejecting it last week.

It later emerged that the BBC has itself been considering a dedicated Scottish channel. In fact, the idea was well advanced before it was taken off the table in a budget review. Well, it should be placed right back on the table. The BBC in Scotland needs to outgrow the 'opt out' mentality that afflicts so much TV output.

The most serious issue facing broadcasting in Scotland is not bias as such, but institutional paralysis and mediocrity. The BBC in Scotland isn't just a branch office – it is a cringing backwater. People with imagination and drive tend to leave for London, worn down by minimal budgets and the culture of safe.

There are plenty of talented people around in Scotland – Scots practically run the UK media. The problem is the subordinate role of the Scottish end of the corporation. The BBC and the Scottish Labour Party are in a very similar condition - and not just because the BBC in Scotland has always been unduly fearful of offending Labour MPs. They suffer from branch office syndrome.

Being ‘regional' means never having to try too hard. Indeed, why bother when your pension depends on not drawing attention to yourself. I remember being told by one senior executive in charge of political output: “No one watches our programmes; so why should we bother making them any better”.

Well, as one of the execs might put it in the wonderful satire on the BBC, WIA, the Scots want “better”. They don't just want a Six O'Clock news which reflects the realities of devolution; they want a quality service that reflects national life.

Nicola Sturgeon didn't mention “Borgen” the hit Danish political series - people think she is too fond of comparing herself to its fictional Staatsminister, Brigitte Nyborg – but there is no reason why programmes like that couldn’t be made here.

The Danish state broadcasters have a charter obligation to reflect the diverse culture and politics of the Danish people. In fact, the producers of Borgen never expected it to be an international success and thought they were producing a rather parochial drama designed to meet a semi-educational remit.

It shows what can be done. As did the 1988 BBC Scotland series, Tutti Frutti. Nothing could have sounded more parochial than a series about a has-been rock and roll band, The Majestics, touring small town Scotland. But it launched the careers of Emma Thomson and Robbie Coltrane.

I watched the series again this summer and was amazed by how fresh John Byrne's work remains today. Tutti Frutti is an allegory of Scottish male culture. Its talented inadequates, drunk on their own machismo, destroy themselves, and the women who try to love them, by trying to live up to the Scottish image of uncaring hard men.

It was as Scottish as a haggis supper but dealt with universal themes with a shocking wit and penetrating insight. That's the kind of thing that BBC Scotland should be producing. Would Tutti Frutti be commissioned today?

Incredibly, after doing a sequel, the playwright John Byrne was never again approached to write another television drama series. Well, he's 'difficult', 'dour' and all those things that don't go down in the media networking circuit.

Broadcasting in Britain is horribly centralised. Ask anyone who has worked in it: if you aren't getting in the face of the right people in London, you don't really exist.

Yet, it’s not as if the London BBC is producing the best broadcasting in the world. It has been shown up by Nordic state broadcasters - Borgen, Killing - and by digital channels in America, like HBO – The Wire, Sopranos.

The BBC has turned into a corporate bureaucracy which, as another product of BBC Scotland, Armando Iannucci put it in his lecture last week, stifles creativity. Iannucci defended public service broadcasting but he compared the BBC’s commissioning system unfavourably with HBO.

The BBC has grown into top heavy structure run by and for a management caste who pay themselves fabulous salaries, speak an impenetrable language and too often commission indifferent and derivative programmes. Endless panel shows and cookery shows; dull and safe journalism; unfunny sitcoms like Mountain Goats.

All the more reason for diversity, for creative localism. Creating a more federal BBC by allocating more of the money raised in Scotland to a Scottish service is one obvious way to reform an over-centralised corporation.

The BBC receives £5bn a year. The notion that £75 million couldn’t be carved out of this immense budget for a Scottish channel is ludicrous. It is, after all, the equivalent of only 75 golden handshakes to execs like Mark Byford.