A failed Siemens deal and a botched in-house effort on the Digital Media Initiative wastes millions of licence fee payers’ money
The BBC has confirmed it is killing its calamitous Digital Media Initiative, admitting it wasted millions in licence fee payers’ money.
John Linwood, the BBC’s chief technology officer, has also been suspended as a result of the project’s failure.
Designed to transform the way BBC staff used video and audio material via content management systems, the project was suspended last year after serious concerns were raised about its costs and benefits.
The DMI had problems from the outset. The BBC signed a contract with Siemens in 2008 to deliver the technology, which never happened, so the contract was killed in 2009.
It appeared to be back on track once work was brought in-house, but the BBC admitted it would not bring any cost benefits as had initially been predicted.
Last November, the BBC Trust wrote to the Public Accounts Committee, which had been tasked with scrutinising the DMI, saying it had serious concerns around the project and that it had fallen behind schedule.
Today, in a letter to the PAC’s chair Margaret Hodge, BBC Trustee Anthony Fry admitted an “overwhelmingly negative picture has emerged”.
“Between April 2010, when the project was brought back under direct BBC control, and the point at which the project is halted, DMI will have cost the BBC £98.4m, having generated little or no assets,” he wrote.
“This is because much of the software and hardware which has been developed could only be used by the BBC if the project were completed, a course of action which, due to technological difficulties and changes to business needs, would be, I fear, equivalent to throwing good money after bad.
“It is of utmost concern to us that a project which had already failed to deliver value for money in its early stages has now spent so much more of licence fee payers’ money.
“The Trust is extremely concerned by the way the project has been managed and reported to us and we intend to act quickly to ensure that that there can be no repeat of a failure on this scale.”
Fry said an external review would be set up, with PwC given the contract. It will “seek to establish what went wrong within the BBC in terms of project management, control and governance”.
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