The BBC and digital? Don't Mention It!

Profile picture for user slauchlan By Stuart Lauchlan May 25, 2013
Summary:
The price of digital failure? If you're the BBC, it's around £100 million so far, a renewed bout of 'mea culpa' performed for the mainstream media and putting a five year digital transformation programme out of everyone's misery.

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Lord Tony Hall, BBC Director General

The price of digital failure? If you're the BBC, it's around £100 million so far and a renewed bout of 'mea culpa' performed for the mainstream media.

Last Friday - a good day to bury bad news with a public holiday looming in the UK - the BBC performed a mercy killing on the broadcaster's Digital Media Initiative (DMI), putting a five year programme out of everyone's misery and deciding it was good idea no longer to throw good public money after bad, albeit somewhat late in the day perhaps.

DMI was launched to enable the BBC to make better use of the assets it creates - from rushes to finished programmes - and to provide BBC staff desktop access to the entire BBC archive which is extensive and could reasonably be argued to be a national asset.

Don't mention the digital!

It came in in a blaze of ambition and excitement, but was quickly being referred to internally at the BBC as Don't Mention It!

The initiative was meant to bring £95.4 million of benefits to the organisation by making all the corporation's raw and edited video footage available to staff for re-editing and output.

Early on, it was estimated that DMI could save 2.5% in TV production costs per hour, worth £100 million to the BBC by 2015.

That was back around 2007, when the first plans were made for the system and when making a single TV programme was said to involve 70 individual video-handling processes; DMI was meant to halve that and bring cost savings in its wake.

Ashley Highfield, who was the BBC’s technology director at the time, promised staff a “world of possibilities where our archived content could be available on the desktops of any member of BBC staff in any BBC office in any part of the world”.

In an email to all BBC staff on Friday, director-general Lord Tony Hall said he was halting DMI and admitted: "We have a responsibility to spend licence-fee payers' money as if it was our own and I'm sorry to say we did not do that here."

Hall's email revealed:

Since 2010, we will have spent £98.4m on DMI. Today's decision means that we are writing-off all of the assets related to this project. That's a prudent thing to do, We believe it is better to close it now rather than waste more money trying to develop it further.

DMI has continued to face challenges. It's struggled to keep pace with new developments and requirements both within the BBC and the wider broadcasting industry. There are now standard off-the-shelf products that provide the kind of digital production tools that simply didn't exist five years ago.

So essentially everything relating to DMI will be written off, with the exception of the Fabric Archive Database, which made it out of the door in 2011 and is the only bit that seems to have worked.

But even this was the system that failed to deliver in April in the wake of Baroness Thatcher's death when instead of being able to tap into seamless access to old video footage, editors found themselves ferrying footage across London in the back of taxis. (Thatcher would doubtless have smiled at the chaos even her death brought to one of her old enemies.)

Who's to pay?

Of course someone's going to have to pay for all this. Who that will be remains to be seen, but John Linwood, the BBC's Chief Technology Officer, is the first public scalp for now, suspended on full pay (£287,000 a year with a bonus last year of £70,000 in case you were wondering).

Linwood actually only came into contact with DMI in 2009 when he was hired from Yahoo.

One of his first actions was to be part of the decision to part company with the contractor brought in to run the project. The BBC initially awarded a £79 million contract to Siemens in February 2008 which Linwood was instrumental in scrapping in July 2009.

The contract itself was the subject of its own microcosm of controversy when it emerged that it had been awarded without the open competition required for a public sector organisation such as the BBC.

The BBC brought the project in-house and managed to secure £27.5 million from Siemens in a no blame settlement.

Blame and the BBC

Blame is one thing that there's likely to be no shortage of in the days and weeks to come as is ever the case with the BBC.

To clarify for non-UK readers, the BBC is funded in the main by a mandatory licence fee which must be paid by any member of the public owning a television, regardless of whether they watch BBC channels at all. Failure to pay results in heavy fines and even threat of imprisonment.

This has been a source of increasing tension in a 21st century market where there are literally hundreds of digital and satellite channels to choose from. Why should we all have to pay for one network when others have to live or die on subscription or advertising revenues?

Hall has only just taken up his position as Director General (the main operational head) on the back of a series of scandals, most notably that of the post-mortem disgrace of 'national treasure' Jimmy Savile.

We really don't have the space or the inclination to try to explain Savile or the cultural and societal impact on the UK of recent revelations about his practices behind the mask of popular respectability - you'll have to google that and come to your own conclusions.

Suffice to say that among many knock-on effects of the Savile affair, one is that it's further pushed the BBC into 'mea culpa' mode as as default first position in the face of any crisis.

Self flagellation

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Anthony Fry of the BBC Trust

So it seems will be the case with DMI as the BBC has already shown signs of a swift descent into self-flagellation overdrive.

PricewaterhouseCoopers will be conducting an inquiry into what when wrong, but Anthony Fry of the BBC Trust - which sits above the corporation's day to day operations and oversees them - has already written to MP Margaret Hodge, chairman of the House of Commons Public Accounts Committee (PAC), and to the parliamentary National Audit Office inviting them to mount their own hearings.

Why have one inquiry when you can have three?

Again for the benefit of the non-UK readers, Hodge is a Labour Party MP who heads up and rules over the PAC, a grandstanding parliamentary forum in front of which pretty much anyone can be dragged for a good tongue lashing, from Google executives suspected of doing evil through to civil servants who've not been up to the job.

Hodge and her committee had previously investigated the DMI project and found it severely wanting as had the other main auditing powerhouse in the UK public sector, the National Audit Office (NAO), which flagged up warnings about DMI back in 2011.

The NAO concluded that the early stages of the Programme were not value for money, mainly as a result of a 21 month delay leading to £26 million of benefits not being achieved in the period 2009-10 to 2010-11.

For its part, the BBC responded at the time:

The financial benefits of the Programme were initially overstated. The original cost-benefit estimate in January 2008 was a projected net benefit of £17.9 million. The latest forecast is of a net cost to the BBC of £38.2 million by March 2017, partly offset by a £27.5 million financial package agreed with Siemens, leading to a final net cost of £10.7 million.

In light of the numbers quoted by Hall on Friday, the only response to that is - if only!

Our money

Because this is public money (and not the discretionary spend of a US private sector TV network such as CBS or NBC) there are serious questions to answer now about why so much money from licence-fee payers has been flushed away to such little effect.

For Lord Hall, this is a good piece of gesture PR if nothing else. He's coming into his role as the BBC remains under attack from many fronts, most notably the tabloid media in the UK and Murdoch empire.

Hall's charged with taking a grip after months of scandal and inept management within the BBC and this is a nice piece of decisiveness in his early days in the job. He'll get plaudits from certain quarters for this.

He does of course have the advantage of being able to own up to shortcomings here as they didn't happen on his watch…

What to learn?

There will undoubtedly be learnings to be taken from this debacle. Project management seems to have sorely lacking, there will undoubtedly be questions revisited about the original specification and contract with Siemens, and there must be answers as to how the organisational structure of the BBC was such to allow this to ramble on for so long.

It's to be hoped however that this isn't just written off as another example of an overly ambitious public sector IT programme that ended up being mismanaged from the centre. The 'well, it's public sector IT, innit - chalk it down to experience' mentality is the kind of 'shrug it off' mindset that initiatives such as G-Cloud and Digital by Default are trying to consign to history.

Meanwhile the BBC will be looking elsewhere - to commodity products - to fulfil the original remit of DMI - and that's just as it should be although no doubt it will get criticised for that as well in the tabloid press.

But as Hall correctly notes:

The need to produce content digitally hasn't gone away.