BBC Cuts: Digital To Get £40 Million Annual ‘Innovation Fund’

Today’s big round of cuts announced by the BBC — it will lose some 2,000 jobs, order relocations for others, and make big changes to the programming schedule in order to cut 20 percent from the BBC budget — largely left digital assets at the corporation untouched.

But that’s mainly because the BBC had already announced that it would be reducing BBC Online’s spend by 25 percent this year. Today, the Corporation actually proposed a little fillip to digital, in the form of a £40 million ($62 million) annual “digital innovation fund.”

The reinvestment in digital is part of the bigger trend that we have seen not just at the BBC but at other traditional media organizations: digital is being used as a way to bring the legacy parts of the business into the 21st century. A spokesperson for the BBC noted to paidContent that while digital may have in the past been a “neglected sibling,” today it’s “difficult to separate digital that way.”

“It’s underpinning investment across all the other areas of the corporation,” she said. She added that the £40 million is coming to digital partly because that division actually cut more in its budget, earlier on, than the rest of the Corporation — 25 percent earlier this year versus 20 percent announced today.

That £40 million is around one-third of a bigger “reinvestment fund” of £145 million annually, which the BBC says will be created “by targeting higher savings than the 16 percent required in the license fee settlement.” It will not be until 2016/17, however, that these funds will be fully realized: it will depend on the BBC following through with the cuts that it has proposed today, and its ability to “mitigate other risks to its finances.”

The BBC is thin on details of of how the £40 million will get used but did note that whatever gets done will follow four basic priorities:
» “Four screens, One BBC“: more services to let consumers get BBC content seamlessly over TV, tablets, mobile and computers. (NB Amazing to note how tablets have become as essential to the content experience, less than two years into their existence, alongside these older formats.)

» Archive: More investment in repurposing the back-catalog both for free and commercial services. This will likely see more services along the lines of the Facebook video launch for Top Gear that we saw earlier this year via BBC Worldwide.

» Partnerships: Investments in more joint ventures with commercial bodies and public organizations. (Project Kangaroo redux?)

» More collaborations involving “BBC funding, brand and technology” to drive economic growth in the UK. This will involve sharing BBC platforms, data and coding where possible.

Second review of digital coming. When the BBC approved the 25 percent reduction to BBC Online’s budget earlier this year, the Corporation said it would streamline services to focus on those most valued by users. That has seen the site whittle down to 10 main products: the Homepage; News; Sport; TV & iPlayer; Search; Weather; Radio & Music; Knowledge & Learning; CBBC; and CBeebies. The BBC today noted it is continuing to monitor the effects of that streamlining and plans to have a second review of BBC Online at some point soon.

Digital/HD TV. The BBC today also proposes investing more money in DAB television. The aim is for 97 percent of the UK population to be covered by 2017 for national BBC services. It plans to make local BBC content available via DAB to 90 percent of the country in partnership with others. The BBC today said it wants to scrap its mixed BBC HD channel, while also creating a new HD channel specifically for BBC 2.

The BBC has now entered into a public consultation for “Delivering Quality First,” the name the BBC has given to the overhaul. The UK public and stakeholders will now have until December 22, 2011, to give their feedback. The full proposal as PDF can be found here; text-only here.