UPDATE 1-Ex-BBC chief Mark Thompson apologises for failed $170 mln IT project

Mon Feb 3, 2014 12:16pm EST

By Belinda Goldsmith

LONDON Feb 3 (Reuters) - U.S. media executive Mark Thompson apologised on Monday to the British public and parliamentarians for the failure of a 100 million pound ($170 million) digital project during his years of running the BBC.

Thompson, who left the publicly funded broadcaster in 2012 to become chief executive at the New York Times Company, said the Digital Media Initiative (DMI) had failed and that meant "the loss of a lot of public money".

The project, that was meant to allow BBC staff to create, share and store content in a new digital system, was suspended in 2012 and axed last May with a loss of 98.4 million pounds.

The botched DMI project is one of a series of controversies at the BBC that has prompted parliamentarians to grill former and current bosses. Other issues include large severance payments to executives, the handling of a child sex scandal involving former TV host Jimmy Savile, and workplace bullying.

Thompson, who was BBC director general for eight years, said

the DMI failed in many ways, which undermined confidence in the project but he stressed other major technology ventures at the BBC, such as the BBC iPlayer and coverage of the 2012 London Olympics, were successes.

"I want to apologise to you and to the public for the failure of this project," Thompson told parliament's Public Accounts Committee as he was quizzed over the project.

He denied misleading parliament in 2011 when he said the project was on track and "out in the business", receiving very positive feedback from users, saying that is what he had believed.

But he said the quality and timing of information about the project passed to management was "not everything it should have been" and the reaction as red flags were raised was too slow.

"There was an intense amount of activity ... but it should have been done more urgently that it was," he said.

The running of the BBC comes under public scrutiny because the corporation's funding comes mainly from a 145.50-pound a year licence fee paid by every British household with a television, that raises about 3.7 billion pounds for the BBC.

Political oversight of the BBC, with its annual budget of about 5 billion pounds, has escalated recently, with management called before 18 parliamentary hearings in the past year.

Thompson was called before the Public Accounts Committee last September to testify about severance payments for 150 departing executives described by the committee as excessive.

Britain's public spending watchdog, the National Audit Office (NAO), last week criticised the BBC Executive Board then headed by Thompson for not having "sufficient grip" on the IT project over an 18-month period or assessing the system to see if it was "technically sound".

Margaret Hodge, chairwoman of the committee, described the project as a "disaster" with a lack of governance and no one single person overseeing the DMI.

The BBC has admitted it "got this one wrong".

The BBC's former chief technician, John Linwood, who was sacked last year after the DMI was scrapped, told the committee there was a "lack of engagement" in the project and that it was behind schedule.

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