BBC scrapped its £98m Digital Media Initiative after five years with nothing usable

In 2008 the BBC wanted every programme made 'tapeless': staff creating, editing and sharing video and audio from their desktops instead of moving tapes. It handed the Digital Media Initiative to Siemens, its incumbent IT supplier, under a technology framework deal worth £79m awarded without open competition. The plan promised a £17.9m net financial benefit and would halve the 70-odd video-handling steps a single programme then required.

Siemens delivered no working technology. The contract was terminated by mutual agreement in July 2009, with the BBC clawing back £27.5m and taking delivery in-house. The National Audit Office, asked to review by the BBC Trust, reported in February 2011 that the early phase had been poor value for money: 21 months late, £26m of benefits forgone, and the business case quietly rebased from a £17.9m net benefit to a forecast £38.2m net cost.

In-house delivery fared no better. In October 2012 the BBC Trust lost confidence and commissioned a review; in May 2013 director-general Tony Hall scrapped DMI outright. Of the £98.4m spent since 2010, the Trust wrote that the project had generated 'little or no assets' — the software and hardware could only be used if the project were completed, which would be 'throwing good money after bad'.

£98.4m spent and written off with 'little or no assets'; a promised £95.4m of benefits never materialised

The BBC appointed Siemens under an existing framework agreement without a new competition, prioritising procurement convenience over delivery capability.

Fixed-price risk transfer failed in practice: the BBC could not intervene in Siemens' development without undermining the risk allocation, so it supervised from a distance while the programme slipped.

The 2008 business case overstated benefits and was not retested when scope grew, so the project outran its own justification by 21 months.

Moving delivery in-house was not assessed against alternatives, repeating the original optimism without adding delivery capacity or a kill criterion.

Giving an incumbent a complex transformation without competition keeps nobody's feet to the fire: the client can't supervise delivery, and has no yardstick to judge the in-house replacement against.

A 2014 Public Accounts Committee hearing called DMI 'a complete failure', and MPs accused the BBC of complacency. The BBC's own NAO-commissioned review in 2017 found oversight of critical projects had improved since DMI — monthly executive reporting cut status-lag from 66 days to 27 — but seven of the BBC's eight critical projects still totalled £885.1m with delayed delivery on five. The failure also weakened the case for the BBC's self-governance: from 2017 the National Audit Office gained routine audit access to the corporation.