BBC deal creates extra cash for IT

An innovative deal that combines the sale of the BBC's technology division with a £2bn IT services contract will provide a vital...

An innovative deal that combines the sale of the BBC's technology division with a £2bn IT services contract will provide a vital cash boost for the broadcaster's IT.

The BBC is due to announce the winner of the IT services contract, worth about £10bn over 10 years, early next month. The winner will also buy BBC Technology. Accenture and Siemens Business Services are the shortlisted contenders.

The corporation's chief technology officer John Varney said potential risks associated with the sale, including the outsourcing of technologies that could give it an edge over competitors, had been addressed. There were also safeguards in place to guarantee the transmission of programmes and quality of service, he added.

"There are some areas of a business that are too risky to outsource, such as digital radio production, and we have not put that into the contract," said Varney.

"We have a whole set of relatively standard protections [in the contract] and specific ones such as step-in rights to take control of a service."

BBC technical staff have spent 1,000 man-days over the past month negotiating the quality of service that the successful supplier will have to deliver, he said.

Varney predicted that other broadcasters would follow the BBC's example and outsource their technology.

The sale of BBC Technology, which has 1,400 staff, follows an internal review of the BBC's technology requirements last year, which identified potential annual savings of £20m-£30m if its IT services were outsourced.

Varney said the sell-off would provide a long-term injection of cash into technology at the BBC and would help the corporation to move away from tape storage and towards making programmes digitally on desktop PCs.

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