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BBC To Sell BBC Tech(2)

In early December, the BBC announced plans to sell BBC Technology, Ltd., its wholly-owned commercial subsidiary. The company officially stated it made the move in order to incur major cost savings over the next decade through outsourcing its technology services.

According to Craig Dwyer, chief marketing officer, BBC Technology, the decision to sell BBC Technology was based on the results of a BBC strategic review of the coming decade, which identified potential annual savings for the BBC of between $35-52.5 million if its technology services were outsourced (last year, BBC Technology delivered $33 million in profits and price reductions back to the BBC). The organization concluded that for BBC Technology to explore additional commercial markets, it needed a stronger commercial profile that could best be accomplished by finding a partner in the commercial realm.

Ed McDermid, head of North American marketing, BBC Technology, emphasized that the move is a positive one for BBC Technology, and the acquisition of BBC Technology includes a 10-year, multi-billion dollar service contract with the BBC. “BBC Technology will become part of a truly commercial entity,” he said.

There are 1,400 employees likely to transfer with BBC Technology to the successful bidder after the EU procurement process, which is due to be completed by next fall. The sale is subject to the approval of the Secretary of State for Culture, Media, and Sport. According to BBC director-general Greg Dyke, the BBC expects “to receive a significant sum of cash for the business.”

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