BBC director general Mark Thompson has announced savings of £320m a year and thousands of job losses as part of a "transformation" of the corporation.
Mr Thompson was appointed as BBC boss in March
About 2,900 jobs are to be cut, mainly from administration departments.
Mr Thompson said the savings were needed so more of the licence fee could be put into programmes.
Almost 2,000 workers are expected to move from London to Manchester, to make the corporation more reflective of UK audiences.
The BBC aims to meet the savings target within three years, redirecting the money into programme-making.
Mr Thompson said more of the licence fee would be put into programming than at any other time in the BBC's history.
The departments hardest hit by the cutbacks are professional services, including human resources, training, finances and legal services, although programme legal advice is to remain as it is.
Mr Thompson said the job losses would be through redundancies and outsourcing of posts during the next three years.
The BBC employs about 27,000 people and most departments would be expected to make 15% cuts as savings, with some further job losses possible, staff were told.
VALUE FOR MONEY SAVINGS
Professional services and support - £68m
Better procurement - £93m
15% savings in news, radio and music, TV, new media, nations and regions - £ 79m
15% costs of commissioned TV programmes - £80m
Total savings per year after three years - £320m
Mr Thompson said the BBC should "spend less on process and more on content".
He said the BBC would only survive in the digital world if it invested more in areas such as journalism, drama, comedy, music, learning, and children's TV and radio.
He also pledged that BBC One would have fewer repeats and less copying of successful genres from other channels.
He said audiences wanted a "BBC which is totally focused on excellence, which gives them more quality, more ambition, more depth than they get from any other broadcaster".
Mr Thompson also announced a major new BBC media centre in Manchester, describing it as "reconnecting with communities across the UK", but he added it would be at least five years before a major move north.
"It will change our tone of voice and open our doors to new talent and perspectives," he said.
The World Service, too, will be asked to make "significant savings", said Mr Thompson, through investment, efficiency and reprioritisation as part of a separate review.
WHO IS MOVING TO MANCHESTER?
Children's TV and radio
BBC Radio 5 Live
New media headquarters
Research and development
Estimated number of staff moving: 1,800
But, he added, the World Service was not subject to the 15% cuts being applied to other departments.
The announcements come as the BBC seeks to renew its charter in 2007. The charter sets out the BBC's role, structure and funding.
Mr Thompson has said the licence fee will only survive as the main method of funding the BBC if the public is convinced that the corporation is spending money wisely.
He said: "I think the process of creating a simpler BBC and focusing on
content is something that will take quite a long time."
The director general delivered to staff the conclusions of four reviews - which included value for money and programme production - that have taken place at the BBC over the last few months.
The BBC boss said that although "high-level recommendations" had been revealed, exact details of how jobs and divisions were affected "may not be clear at this stage".
He said the impact of the reviews will be worked through in the coming months, adding: "By March 2005 we will have the implementation plans."
Union leaders vowed to fight all compulsory redundancies and warned of possible industrial action.
In a joint statement, the National Union of Journalists, Amicus and Bectu said: "Far from preparing the BBC for charter renewal, we believe a policy which requires such colossal job cuts, reductions in programme commitments and the sale and privatisation of core sections of the BBC risks destroying its ability to continue as the UK's leading public service broadcaster, and poses a
substantial risk to the BBC's continuing right to the licence fee."