Since the late 1960s it has been argued that an AGN must be powered by accretion of mass onto massive black holes (10 to 10 times the Solar mass). AGN are both compact and persistently extremely luminous. Accretion can potentially give very efficient conversion of potential and kinetic energy to radiation, and a massive black hole has a high Eddington luminosity, and as a result, it can provide the observed high persistent luminosity. Supermassive black holes are now believed to exist in the centres of most if not all massive galaxies since the mass of the black hole correlates well with the velocity dispersion of the galactic bulge (the M–sigma relation) or with bulge luminosity. Thus AGN-like characteristics are expected whenever a supply of material for accretion comes within the sphere of influence of the central black hole.