Siemens wins major BBC contract

Some of the BBC's technical staff are wary about the deal

A subsidiary of the German engineering giant Siemens has landed a 2.7bn euros outsourcing contract with the British Broadcasting Corporation (BBC).

Siemens Business Services (SBS) will also take over BBC Technology, the corporation's IT unit.

Neither of the two would reveal the price paid, though it is thought to be in the region of £2bn.

Plans to sell the unit as part of the BBC's cost cutting exercise have been controversial among BBC workers.

"This isn't just the BBC selling off one of its Crown Jewels, it's a case of handing its central nervous system over to the private sector," said Gerry Morrissey, assistant general secretary for BECTU, the union representing many of the 1,400 workers who will transfer to SBS.

The union also disputed BBC's claim that the deal would save £30m per year and it said the changeover from analogue to digital could be made more complicated by this deal.

But the BBC insisted that "the value and substantial savings created from the sale of BBC Technology and this procurement of our technology services is a significant step for us in ensuring the BBC is fit for the future".

The BBC's charter, which determines the BBC's budget and the ground rules for how it operates, is up for review in 2006.