BBC bosses today announced that 2500 jobs are to be axed at the corporation, confirming workers’ worst fears over budget cuts.

Director general Mark Thompson said the BBC would create some new jobs and offer redeployment to other staff. The net loss across the UK will be 1800, as he tries to plug a 2 billion funding shortfall. In Scotland there will 230 job losses, although 130 new positions will be created.

The BBC also confirmed the sale of its iconic Television Centre building in Shepherd’s Bush, west London where thousands of staff are based. Union chiefs today warned industrial action was “inevitable”.

The NUJ has launched a scathing attack on the top brass of the corporation, calling on them to consider their positions.

Stephen Lowe, NUJ union representative for Edinburgh and Glasgow, said: “It’s ludicrous. We’ve had two years of ongoing cuts and redundancies - they’ve bled the place dry. They’re still looking for voluntary redundancies from the last process, so I don’t see where or how they are going to cut back further without doing less.

“What we are dealing with here is management failure on a grand scale. They failed to get an appropriate licence fee settlement, and then failed to plan for that.

“Industrial action is inevitable. There are plenty of options as well as strike action.”

It is likely to lead to more programmes made by independent companies being bought by the BBC. This approach has already got the corporation into trouble.

A trailer made by an independent firm featured clips of the Queen it wrongly claimed showed her storming out of a photo shoot. The BBC is cutting ten per cent from the number of programmes it commissions, which will lead to more repeats on television, in an effort to make efficiency savings of three per cent a year.

BBC Trust chairman Sir Michael Lyons said the trustees would be making sure the cuts would not damage the quality or “distinctiveness” of the BBC. But Mr Low attacked the move. He said: “Mr Thompson is saying we are going to sack people in the BBC to allow huge companies like Endemol to come in and make money from the licence fee.”

Officials from the broadcasting workers union Bectu were meeting with their NUJ counterparts today to discuss a response.

After meeting Mr Thompson, Gerry Morrissey, general secretary of Bectu, said unions were willing to negotiate with the BBC to help make savings.

He said: “We’re saying we want to enter a meaningful dialogue with the BBC. That meaningful dialogue cannot take place against the background of the BBC writing out to people, saying come and collect your redundancy cheques.”

WASHINGTON: The U.S. Department of Justice approved Sirius Satellite Radios $5 billion buyout of its rival XM Satellite Radio on Monday, saying the deal was unlikely to hurt competition or consumers.

The deal was approved despite opposition from consumer groups and an intense lobbying campaign by traditional radio broadcasters.

The buyout received shareholder approval in November. The companies said the merger would save hundreds of millions of dollars in operating costs.

David Joyce, an analyst at Miller Tabak, said the savings could be significant. “The net present value of synergies could be north of $3 billion,” he said.

The Justice Department said the combination of the companies would not hurt competition because the companies were not currently competing. Customers must buy equipment that is exclusive to either XM or Sirius, and subscribers rarely switch providers.

“People just dont do that,” said Thomas Barnett, an assistant attorney general.

The government appeared to endorse the argument of Sirius and XM that their competitors encompassed many forms of audio entertainment, including “high-definition” radio, Internet-based radio stations and even music players like the iPod.

“The likely evolution of technology in the future, including the expected introduction in the next several years of mobile broadband Internet devices, made it even more unlikely that the transaction would harm consumers in the longer term,” the Justice Department said.

XM Satellite shares climbed $1.85, or 15.5 percent, to close at $13.79 in New York after the governments announcement, while Sirius shares rose 25 cents, or 8.6 percent, to close at $3.15.

The deal is also being examined by the Federal Communications Commission. April Horace, an analyst at Janco Partners, said FCC approval of the combination was probable.

“The takeaway here is that historically the FCC does not go against the DOJ,” Horace said, referring to the Department of Justice. “We obviously think the two agencies have been talking.”

«investing.businessweek.com»’s coming-out party was anything but festive.

Two months into his new job as chief executive of the troubled wireless operator Sprint Nextel («www.businessweek.com»), Hesse oversaw his first quarterly earnings report and analyst call. His message was as blunt and depressing as a Sylvia Plath poem: A turnaround of the No. 3 U.S. wireless operator is not going to happen any time soon. “I now have had two full months at the helm, and to be perfectly frank, the issues we face are more difficult than what I had expected to find,” Hesse said on a Feb. 28 conference call following yet another dismal quarter. “This turnaround will not happen for many quarters.” Sprint shares fell more than 10%, to close at 8.03, a new 52-week low. The last time Sprint touched $8 was in February, 1989.

There was so much bad news it’s hard to know where to begin. Customers, fed up with horrible customer service, continue to flee Sprint in droves. The company confirmed a staggering $29.7 billion writedown, wiping out nearly all of the value of its $35 billion merger with Nextel Communications. And dividend payments were suspended “for the foreseeable future.” Ratings Downgraded on Bad News

But that’s not all. Among premium subscribers, churn—a key metric measuring the percentage of customers who leave the company—was flat at 2.3%, despite intense efforts by Sprint to reduce the figure. Interim Chief Financial Officer «investing.businessweek.com» said the company expects churn to increase 0.2% to 0.3% in the first quarter “due to competitive pressures” and rising defections among lower-credit customers. Customers that are staying with Sprint are spending less money, with the average revenue per customer declining 4% over the year-ago quarter. And, to top it all off, Sprint announced it has borrowed $2.5 billion from its revolving credit facility to help pay off $2.25 billion in bonds that will mature in 2008 and 2009.

“This was an opportunity for Hesse to throw out everything including the kitchen sink and he did,” says James Moorman, an analyst with Standard & Poor’s. “Rebuilding your image does not happen overnight. It will be tough for a while.”

Fitch Ratings promptly cut its rating on Sprint Nextel to junk status and warned that it may cut the rating again since 2008 results will be significantly worse than expected. S&P said it may cut Sprint’s ratings to junk. “The erosion in Sprint Nextel’s subscriber base and the resultant decline in EBITDA are substantially higher than we anticipated and the company’s business profile is probably no longer supportive of an investment-grade rating,” S&P credit analyst Allyn Arden said in a Feb. 28 statement. Reviving Customer Service

The core challenge for Hesse will be to repair Sprint’s damaged reputation and convince customers to give the company another chance. In the fourth quarter of 2007, Sprint reported a loss of 683,000 premium subscribers who sign up for long-term contracts. In that same quarter Verizon added 2 million customers, including 1.6 million post-paid subscriptions, and AT&T added 2.7 million customers, including 1.2 million post-paid subscriptions. The customer service problems are so pervasive that Hesse said the company expects to lose another 1.2 million premium subscribers in the first quarter of 2008, and that the outlook was unlikely to improve in the second quarter.

To slow customer defections, Sprint announced a new service plan for $99.99 a month that offers unlimited calling and data plans, including unlimited text, video, and picture messaging. Rivals Verizon Wireless (a partnership between Verizon Communications («www.businessweek.com») and Vodafone (