BBC plans commercial wing

Greg Dyke: 'More money for programmes'

The BBC has announced plans to create a new commercial wing in a shake-up of the corporation's structure aimed at raising up to £200m over six years.

The formation of BBC Technology Ltd, which aims to raise extra funds by providing technological expertise for other broadcasters, is expected to result in at least 200 job losses.

Like BBC Resources before it, the new trading arm will be a wholly-owned subsidiary company, but will operate at arm's length from the corporation providing broadcast, IT, online and communication services at competitive prices.

Its 1,300 staff will also offer services like internet broadcasting, consultancy and project management to other companies.

I am confident we will become a cash contributor to the BBC

Margaret Salmon
Head of Resources

The division will absorb some of the responsibilities of BBC Resources and many of its staff.

BBC Resources, which has been reviewed over the past two months, will now concentrate on studios, outside broadcasts, post production and design work.

Commercial revenue

The move is intended to help the BBC to meet the government's target of making savings and increasing revenue to find £1.1 billion by 2006, set in February alongside the new licence fee settlement.

Director General Greg told staff the plans on Thursday, and said: "The aim was to find more money to put into programmes and services.

"The changes contribute to that objective by generating more commercial revenue, increasing efficiency and reducing the money spent on overheads.

"BBC Technology Ltd has an exciting range of services to offer to a growing market. And a smaller more focused BBC Resources Ltd is better placed to realise its full potential while keeping craft skills at the heart of the BBC."

The BBC's marketing wing, BBC Worldwide, has successfully raised commercial cash through selling programmes abroad and sales of videos and books.

Culture Secretary Chris Smith will have to give formal approval to the new company, due to launch in October.

Some other sections of Resources will be transferred to other BBC divisions in the next nine months.

We're hoping that these job losses can be achieved by natural wastage

Gerry Morrissey
Bectu

They include the Scotland, Wales and Northern Ireland Resources sections, which will pass to the respective national controllers from April, reflecting "the spirit of devolution with real power and responsibility moving out of London".

Changes within BBC Resources will involve cost savings which the BBC says will mean "streamlining the structure and reducing headcount", and discussions with unions will begin soon.

Job losses

Head of Resources Margaret Salmon said that with a tighter focus and significant organisational changes "I am confident we will become a cash contributor to the BBC, having retained a prominent role in sustaining craft skills for the industry".

The Davies Panel review of BBC funding last August had called for most of BBC Resources, then valued at £200m, to be sold off.

Ms Salmon said around 200 job losses, predominantly in London and Manchester, are expected in the near future, and added that there could be some other impact on jobs over time.

Gerry Morrissey of the broadcasting union Bectu said Thursday's announcement was a better result than the privatisation of BBC Resources outlined by the Davies Panel.

"We're hoping that these job losses can be achieved by natural wastage," he said.

"But if they don't go down that road of voluntary redundancy and natural wastage we will obviously be renewing our position on this."

He said there are concerns about the status of pension schemes and terms of employment for staff transferred to BBC Technical.