The BBC has retained the broadcast rights to the Olympic Games until the end of the decade, encompassing the next two winter and two summer Games.

The deal is believed to be worth about £60m, a “modest” increase on what the corporation pays at the moment but a relatively small increase compared with rises elsewhere in the world. In total, it takes the amount raised by the IOC from its latest round of rights negotiations to more than $1bn in Europe alone. Although it seriously considered tabling a bid, BSkyB is not understood to have launched a bid for a set of rights that would require changes to the listed events legislation in any case.

The International Olympic Committee was understood to be concerned about recent cuts to the BBC sports rights budget but entered exclusive negotiations with the corporation after being reassured of its commitment.

Rights the BBC has acquired in the deal announced on Wednesday cover the 2014 Sochi winter Games, the 2016 summer Games in Rio, the 2018 winter Olympics in Pyeongchang and the 2020 summer Games, which will be held in either Istanbul, Madrid or Tokyo.

The BBC’s association with the Olympics goes back to 1928, when it first broadcast its radio coverage. It has shown every Olympics since the Rome Games of 1960 live on television in an unbroken sequence.

Although the IOC investigated the possibility of splitting the coverage between a free-to-air broadcaster and a pay-TV operation, as is the case in Italy, the BBC was desperate to retain its exclusivity.

After last year cutting its sports rights budget by a fifth, the BBC renegotiated its Formula One deal to save money and now shares the rights with BSkyB.

It has also withdrawn from horse racing and cut back on darts, tennis and snooker coverage.

But the Olympics, which the BBC will broadcast across 26 channels from London this summer, is considered a prime vehicle to demonstrate the corporation’s public service role in bringing large audiences together for major events.

“I’m delighted that the Olympic Games will continue to be broadcast exclusively on the BBC into the 2020’s,” said outgoing BBC director general Mark Thompson.

“It’s terrific news in the days before BBC Sport begins to cover the London 2012 Games and a tribute to the enduring partnership between the BBC and the Olympic movement.”

The deal is also seen as crucial to maintaining morale at BBC Sport’s new base in Salford. During the move north, it lost around half of its staff.

“This news will come as a massive boost to our teams who are about to undertake our most ambitious sports broadcast ever at the biggest sporting event in our country’s history,” said BBC director of sport Barbara Slater.

“The Olympic Games has always been significant as an event that brings the nation together as well as a catalyst for broadcasting innovation and we’re delighted that BBC Sport can now continue to deliver on these traditions through to 2020.”

The IOC has sought to maximise the value of the TV rights since turning its back on a deal with the European Broadcasting Union in 2008, through which the BBC held the rights for the 2010 Vancouver Games and London 2012 as part of a $700m (£448.43m)pan-European agreement.

The majority of European rights were sold to the sports agency Sportfive, but the six most lucrative markets – Spain, France, Germany, Italy, Turkey and the UK – were carved out for direct negotiation.

BBC chairman Lord Patten said it underlined the corporation’s commitment to sport, even if it could not always compete with the deep pockets of pay TV rivals for live football.

“It’s a fantastic way of starting an incredibly important three weeks or so in the history and life of the BBC. In many ways its the biggest thing we’ve done. It was a very tough negotiation but what swung it for us in the end was that they recognised that we were the best sports broadcaster around. We’ve now got to live up to that,” he said.

“It’s hugely important for us as the nation’s broadcaster to be covering such a hugely significant national event. It underlines our commitment to sport despite the fact we haven’t got as deep pockets as pay TV. Our total spend on rights this year is about the same as BT have paid to cover 38 football matches a year.”

He pointed to audiences of more than 23m for England’s exit from the European Championships and almost 17m for the Wimbledon final as evidence of the BBC’s continued ability to reach big audiences.

“We produce about 2% of televised sport in hours but have about 40% of the audience. It’s significant for reach and as part of our civic role helping to bind the community together,” said Patten, who also underlined the importance of retaining the listed events legislation that retains the Olympics, the World Cup, Wimbledon and other sporting events for free to air television.

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