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Thompson seeks to clarify cuts

There’s an unmistakeable ring of a communist-era five plan about the BBC’s latest operational review, the grimly titled Delivering Quality First.

The pressure to find 20% of savings as a result of the licence fee freeze until 2016 is the driving force behind the initiative. The BBC is consulting with senior execs about what kind of cuts it should implement, in a process that runs until May.

It’s this consultation process that has led to lots of leaks in the press over recent weeks, with frequent headlines about daytime programmes being scrapped on BBC2 or local radio output being axed.

In a briefing to journalists today, director general Mark Thompson sought to clarify exactly what is going on  and effectively ruled out closing existing stations. “It’s not obvious that what the public wants is a complete reduction of services,” he said, explaining the reprieve granted to BBC6 Music and The Asian Network.

That means that many of the cuts will take place at a programme level, affecting many in the production community - both inhouse and indie - who make shows for the BBC.

Even though the consultation has yet to run its course, some common themes have already emerged - and were confirmed by Thompson in his press briefing today.

So it’s probably not a good time to be making daytime shows like To Buy or Not to Buy, Restoration Roadshow or Flog It! on BBC2, as the BBC is mulling focusing instead on a ‘richer originated daytime schedule on BBC1’. The BBC is also considering reducing the £150m it spends on overnight programming after 10.35pm.

Conversely, it’s probably a good time to be producing peak time shows, in particular on BBC1. “Should we protect the BBC1 budget by making other cuts in TV?”, is one big question raised in the BBC’s consultation. It’s early days yet, but clearly BBC1 is going to be the big winner in this process.

Another winner is likely to be drama. “Should we spend more on drama to reflect high public demand?” asks the consultation. The BBC is also thinking about repeating more of its big ticket shows, such as dramas like South Riding or natural history series like Human Planet, acknowledging that viewers’ increasingly busy lives mean they are often missed first time around.

Politics and current affairs shows look set for a rethink too, with the BBC asking ‘what fewer, bigger, better would look like.”

Producers working outside London will also be cheered by Delivering Quality First, as it asks whether more of the BBC’s channels and commissioners should be located outside London.

In fact, what’s so surprising about the Delivering Quality First consultation is that - beyond its off-putting title - it has come up with some rather sensible suggestions for saving money AND improving output. So much so that one wonders why a lot of it wasn’t implemented years ago…

One other surprising thing to emerge from Thompson’s press briefing today was how he played down the impact of the licence fee settlement on the BBC, describing it as a ‘cash flat’ settlement.

The real concern, he added, came from inflation. He said the BBC’s income “will rise significantly” over the licence fee period, despite the fact that the licence fee itself has been frozen at £145.50 per household until the end of 2016.

Thompson put this down to: the growing number of households in the UK; existing savings; reduced licence fee collection costs and evasion; as well as increased revenue from commercial activities. He added that “if increased commercial revenue is strong, it will more than pay for the additional obligations” the BBC has taken on under the licence fee settlement, notably running the World Service.

However, on a day that the official annual rate of inflation hit 4.4%, Thompson said that “inflation is the big challenge.” The danger, Thompson said, is that “the take increases but is eroded by inflation.”

Posted 22 March 2011 by Tim Dams

The state of comedy TV

Broadcasters, it seems, are game for a laugh.

The BBC, long the biggest player in the comedy genre, is enjoying a strong run thanks to new hits such as Miranda, Rev, The Trip, Come Fly with Me and Him and Her.

Meanwhile, Channel 4, buoyed by the success of The Inbetweeners, is ploughing extra money into comedy as it seeks new hits in its post-Big Brother era. Its comedy commissioning budget has increased £5m to £27m a year.

But the biggest news in the small world of comedy TV is the arrival of Sky as a significant investor in the genre. From a standing start, it’s set to roll out eight new comedies a year on Sky1. It’s also looking to commission for Sky Living, Sky Atlantic and Sky Arts.

Elsewhere, UKTV’s Dave also has two scripted projects in funded development with indies, while Comedy Central is beginning to invest in original UK comedy production.

Channel 4’s head of comedy Shane Allen says it’s no surprise that broadcasters are increasingly prioritising comedy. “Things like The Inbetweeners can have very humble origins and become very channel defining,” he says. The Inbetweeners started out on E4 with 230k viewers for its first episode back in 2008. By its third series, it was attracting over 4m – a key factor in E4 winning so many plaudits in recent months.

At the same time as being a channel defining genre, the long term value of comedy over more disposable genres like factual entertainment and entertainment is increasingly being recognised by broadcasters. For many years, comedy was seen as something of a ‘market failure’ TV genre – expensive, risky and best left to deep pocketed public service broadcasters. But comedy is now seen as less of an expensive luxury. As Friends proved, broadcasters can practically build a channel by repeating a hit comedy series. A successful comedy has a very long shelf life. “A repeat of Father Ted will still do pretty well on More4 – and that is 15 years after the first TX,” says Allen. Comedies can also enjoy good DVD sales and – in the case of The Inbetweeners – potential film spin-offs.



Better market for comedy

“There’s a better marketplace for comedy ideas now,” confirms Kenton Allen, chief executive of Big Talk Productions, whose indie has just made Friday Night Dinner for C4, and is soon to go into production on the second series of Rev and Him and Her. “But winning commissions is one thing. Financing the shows is a whole different ball game.”

Allen says broadcaster budgets, particularly at the BBC, have gone down between 10-20%. Talent costs, however, are rising. Crews, says Allen, have to work longer to make shows work - Rev was made on six day weeks for six weeks. “It’s exhausting.”

DVD and distribution advances help with budgets, he acknowledges. “But they all need to be recouped - which puts the profit point further down the track if you are not careful.”

Fellow producer Henry Normal, md of The Trip producer Baby Cow, echoes Allen’s words. He agrees that the number of slots has increased, particularly with Sky investing heavily in the market. Advertisers like Fosters, he adds, are also directly funding online comedy series such as Baby Cow’s Mid Morning Matters with Alan Partridge.

“But there’s still a lot of people chasing a few opportunities. It’s a very difficult business – there’s lots of very good people producing.” “Trying to get six comedy scripts to a good standard can take half a year, then bringing them to air can take another half a year. It’s a year’s work. If it doesn’t get recommissioned, you start from scratch. It’s very difficult for smaller companies to set up and maintain.”

Baby Cow has been running for 11 years, and has 12 employees. “We very often spend seven days a week trying to make it work. If I had to set up now, I’m not sure I would. It is hard. But I was naïve when I set up – and I can’t do anything else, so it helps concentrate the mind,” says Normal.

Difficult choices at the BBC

Among comedy execs, it’s acknowledged that it’s been a good year for comedy, with the BBC in particular doing well.

BBC head of comedy Cheryl Taylor puts this down to a wealth of talent in the business, both in front of and behind the camera, saying that all parts of the industry “seem to be firing on all cylinders.”

“The last 12 months have essentially constituted a vintage year - we’ve had absolutely fantastic talent like Miranda coming through.” Taylor adds: “I feel certain that the reason that comedy is on a wave at the moment is that there are some really funny shows out there. That is the bottom line.”

This success, however, means that hard choices lie ahead. Because of BBC budget cuts and a need to make room for new ideas, Taylor is unable to recommission several shows which debuted strongly. The problem is acute on BBC2, home to Miranda, The Trip, Rev, Whites, Grandma’s House, Psychoville, Harry and Paul and Roger and Val Have Just Got In. “There’s some tough choices, and we are still working it out. But I want to bring back as many deserving shows as we can possibly afford,” says Taylor.

Across all four BBC channels, Taylor stresses the need to “find ambitious, fresh ideas to reach a broad audience.” While acknowledging that BBC2 and BBC4 are the homes of more boutique authored pieces, she says that overall “there is a great need for comedy that has entertainment values at its heart, so unearthing confident, bold comedy personas is a priority for me.”

Kenton Allen picks up on this theme: “As we go into more austere times, things that are inherently laugh out loud funny are an easier watch. I think there is a clue in Miranda, which is joyous, funny and likeable.” Multicamera sitcoms like Miranda fell out of fashion for a long time, making way for nuanced half hour comedies. “Where are our big laugh out loud Father Teds, Ab Fabs - those sort of shows,” says Allen. “Miranda is one of them, The IT Crowd is another. But there is room for more.”



C4 broadens its appeal

One senses that Channel 4 is starting to explore this territory too. Under new programming boss Jay Hunt, the channel is looking at broadening the appeal of its comedy, embracing a more modern, mainstream entertainment agenda.

With extra money in his budget, the emphasis is very much on 9pm, says head of comedy Shane Allen. He met with Hunt soon after she joined the channel. “She said you do brilliant reputational stuff. But it is expensive and should play more at the heart of the schedule.” Distinctive material for 9pm is a hard place to launch new talent, acknowledges Allen. So it’s likely the slot will be for established talent and writers, with E4 the home of more experimental comedies targeting a younger audience.

For C4, says Allen, we want “things with more jokes – broader pieces.” He’s looking out for nine or ten sitcoms on the main channel, and four on E4.

Sky powers into the market

Astonishingly, this is about the same amount of comedy that Sky hopes to commission across its four channels.

Sky, says producer Henry Normal, “will be the biggest single influence over the next couple of years – they seem to be setting their stall out to do comedy in a way that they have never done before.”

Channel boss Stuart Murphy really signalled Sky was getting serious about comedy when he poached BBC head of comedy Lucy Lumsden. She was originally tasked to commission for Sky1 alone. Now she is working across four channels, Sky1, Sky Living, Sky Atlantic and Sky Arts.

It’s a move that Lumsden describes as “a mini-cultural revolution.” Eight series will run on Sky1. Two comedy drama series have already been announced, Mount Pleasant and Stella and the broadcaster recently played out ensemble piece Christmas Crackers. In the coming weeks, Sky will announce four or five new titles for Sky1.

Lumsden says Sky1 has targeted blue-collar family audiences with its new shows. She points to Stella, a family saga set in the Welsh valleys written by and starring Ruth Jones. Lumsden describes it as a “blue collar series reflecting modern Britain...and the lives of our customers.”

ITV through to Dave

ITV has never been regarded as a major player in comedy. It’s enjoyed success with Benidorm, now in its fourth series, and Harry Hill’s TV Burp is hugely admired in the industry. But recently, it’s got behind Jason Manford’s Comedy Rocks variety show.

UKTV’s Dave is also upping its activity. The channel famously brought back Red Dwarf for three episodes in 2009, and buoyed by that success is developing two scripted and one animated project. Head of commissioning Jane Rogerson says, “UKTV comedies have to feel as if they can stand out in the market”, adding that “they need to contain well known faces that will bring an audience to the screen.” Rogerson also stresses the need for "innovative funding models that bring partners together” to help fund UKTV shows.

After all, Rogerson says, “I don’t underestimate that comedy is one of the most difficult genres to get right. Its price per pound and your guarantees on return make comedy one of the most high risk in the market.”

COMEDY Q&As


Lucy Lumsden, Sky head of comedy
How much are you now commissioning? We are going to be having original British comedy on Sky 1, Sky Living, Sky Atlantic and Sky Arts. We're doing about eight series with Sky1 a year, up from none when I took over.
What are you looking for on Sky1? Sky1 is very good at reflecting Californian blue sky, sun drenched lives - but what about our own and the lives of our customers. So we’ve absolutely gone hell for leather for that. The other big theme is that we’re going for the family audience.
And the other channels? We’re looking for about 2-3 titles on Sky Living, female led shows for 20-40 somethings. Sky Atlantic has This is Jinsy, and can bring on newer voices. Sky Arts is known names doing things that might surprise you.

Cheryl Taylor BBC Controller, comedy commissioning
What are you looking for? Funny scripts, first and foremost, across all channels. Big bold laugh out loud shows with entertainment values at their heart. We are keen to find ambitious, fresh ideas to reach a broad audience. There is a great need for comedy that has entertainment values at its heart, so unearthing confident, bold comedy personas is a priority for me.
What are you not looking for? You’d be amazed how many scripts we receive that either are 50 mins in length and are supposed to be half an hour, or have absolutely no jokes in them at all.

Shane Allen Channel 4 Head of comedy

What are you looking for? As well as doing reputational pioneering stuff on E4, on C4 we are looking for things that could play at 9pm and be a bit broader. We are trying to think of areas that people can have an immediate buy into, like Friday Night Dinner, C4’s first family sitcom, or returning things that people recognise like The IT Crowd. We want things with more jokes, and broader pieces.
What are you not looking for? Sketch shows are very difficult to punch through for us. We’re not really after niche, darker, quieter comedies. Or comedies where people play a version of themselves.

Posted 21 March 2011 by Tim Dams

What's the outlook for MipTV?

Programme sales executives are busy preparing for next month’s MipTV market in Cannes (4-7 April).

Beyond the stress of the last minute preparations for the market, their mood seems positive. With just a few weeks to go, most sellers seem to think that it will be a busy event, citing the fact that broadcasters are spending again as the ad market recovers.

Here’s the opinions of four leading sales companies on the outlook for MipTV:

Dan Allen
Chief operating officer, Fremantle Media Enterprises

"Mipcom in October was a bounce-back market, and I fully expect that to continue at MipTV. The broadcasters have come out of the recessionary period very strongly. They have addressed their cost base and emerged leaner and fitter. Ad revenues are flowing back and that is all going to their bottom line and so therefore they are reviewing what they can spend on content. That macro indicator suggests that there should be quite a lot of money in this market. Those who have got a strong slate of content are going to be the ones that reap the benefit of whatever buoyancy there might be. We’re feeling very positive because, as usual, we have got incredibly strong slate of content, particularly dramas now. We have invested a lot of time and effort and money in drama development over last 2-3 years and it’s really starting to bear fruit."

Sarah Tong
Director of sales, Hat Trick International

"There’s a lot of talk about the new “hot bed” for creativity, with representatives from Israel, Finland and the other Nordic regions talking about their various credentials. But what each of these commentators concedes is that the UK remains the territory that the world is watching for the best ideas, execution and talent. It’s important that British producers have a strong presence on the international stage and can partner with distributors, like Hat Trick International, whose own agendas don’t stifle their creativity. On a product level, as well as the continued interest in British comedy and drama formats, we are seeing an increased demand internationally for factual entertainment series with broad appeal."

David Pounds
Chief executive, Electric Sky

"Since Mipcom we have been very busy with some sales months being the best in the company’s history, so we have high expectations for MipTV. We are lucky to have amazing shows from our producers, with very high ratings attached, some even in glorious 3D. Generally most territories are buying with strong orders from Australasia, Europe and Scandinavia. Factual seems still to be king in the market, which is great for us, and our performance catalogue is showing signs of increased popularity as well. We look forward to launching our exciting New Releases catalogue at MIP with our hallmark of colour and flair."

Francois de Brugada
Executive vp, Banijay Group

"I believe the industry is now genuinely transcending the traditional boundaries of TV. The effect of this is that traditional television companies’ competitive set is changing, as is their product, and the way it is acquired and sold in Cannes. Content suppliers aren’t just competing with other television producers; they’re now competing with any other producer of leisure activities, big or small - in fact anything that attracts eyeballs! Their product is no longer confined to a number of episodes of a television series; they’re now free to sell all ideas and concepts that have the potential for multi platform exploitation. From a simple, smart interactive app to a complex mega entertainment format. The people they are selling to are not just international TV buyers, they are web portal owners, gaming platforms, social media networks, publishers, consumer product manufacturers"

Posted 18 March 2011 by Tim Dams

The superindie view

Interview: Steve Morrison has presided over the phenomenal growth of All3Media, from blank sheet of paper to the UK’s largest production group. But what’s next for the indie sector’s biggest consolidator?

Steve Morrison is midway through explaining how All3Media grew to become the UK’s largest ‘superindie’ production group, when a colleague steps into his glass panelled office and hands him a piece of paper. “Very interesting,” says Morrison quietly as he scans a news report saying that rival superindie Shine Group has just sold to News Corp for £415m, before speculating aloud about the financing of the deal.

It’s little wonder that the news is so interesting to him. Confirmation of the Shine/News Corp deal comes just as All3 is itself the subject of intense speculation that it is about to be put up for sale by its private equity owner Permira.

Morrison himself gives the All3 sale rumours short shrift. “It’s too premature. We haven’t hired [an investment bank]. At the moment we are concentrating on growth,” is all he says on the subject.

The All3 story is, indeed, one of incredible growth – from a blank sheet of paper in 2003, via a breathtaking series of acquisitions, it is set to turnover more than £450m this year. This, though, has come at a big cost: All3 has bank debts of £256m on earnings of £50.5m.

It began back in 2003, soon after Morrison quit as chief executive of Granada Media Group in the wake of the £1.3bn ITV Digital debacle. Instead of bowing out of the TV business, Morrison teamed up with former colleagues David Liddiment and Jules Burns to found All3.

“David Liddiment said there is no point starting our own production company – we are just far too old and it will take us years to get up and running,” recalls Morrison. “But, he said, doesn’t the independent sector now need a group?”

Backed at that time by private equity group Bridgepoint, All3 then went on a major buying spree beginning with Chrysalis for £45m. It now owns 20 companies, predominantly in the UK, but also in the US, Germany, Holland and New Zealand.

Since the very beginning, All3 has followed a federal model, allowing its indies creative autonomy and their own identity. It’s a model that Morrison learnt at Granada, when it acquired LWT, United and Yorkshire. “Matrix management” is the way he describes it. “You want the companies to be as self reliant and as strong as possible – we chose them because they are that type of company.”

He says this self-reliance is “All3’s secret weapon”, making it the very opposite of a centralised top heavy organisation that stifles widespread idea creation. There might be 200-300 formats swirling around All3’s companies at any one time, he says. It’s then the job of a central team at All3 including Liddiment, Ruth Wrigley and Wayne Garvie and All3Media International “to capture all this creativity and magnify it as best we can to help the companies get their programmes around the world.”

Morrison and his senior team also hold a “long and very detailed strategic meeting once a month with each production company to discuss and outline strategy. “We debate the strategy. It is theirs to do, but ours to listen and counsel.”

Despite paying millions to acquire each indie, no company boss has left since their big paydays, insists Morrison. “Everybody asks us this question: if you pay quite a lot of money for a production company to a relatively small number of individuals, will they all go off to the golf course?” He says it hasn’t happened because each outfit is run by creative entrepreneurs who remain proud of their companies and shows.

In fact, he maintains that it is All3’s support and central expertise that has helped outfits like Maverick “grow by 400% in a short space of time” or Company crack the American market with a US version of Skins for MTV. “We offer the companies the opportunity to grow, but with the backing that perhaps they would have found more difficult on their own.”

The US is a key target for growth in the coming months, with All3 aiming to double output there to $100m this year. Six All3 outfits are now producing in America, each with their own offices and set ups rather than one centralised American group.

The focus on America is crucial, he says. “My view is that the UK is a fantastic springboard – you can’t be a great exporter without a strong home market. But America is a magnifier, a megaphone of your idea which then sends a louder signal about being successful around the world.”

Morrison describes All3 as ’50-50’ UK and international. It’s clear that, in the face of a stagnating home market, he’s sees international markets as key to All3s future growth.

And it’s this growth that he clearly expects will help All3 offset the tremendous debts it has built up through its acquisition spree. “As long as you are growing – and this year we are hoping to go back to double digit growth, having very successfully survived the recession – the banks support you because they can see what you are doing with their credit.”

CV
Started as a radio producer with BBC Scotland.
In 1974 joined Granada, rising to director of programmes in 1987 and md in 1993.
Md of LWT (1994).
Chief exec of Granada in 2001.
Formed All3 in 2003 with David Liddiment and Jules Burns after the acquisition of Chrysalis TV.
All3 now comprises 20 companies including Company Pictures (Skins), Studio Lambert (Undercover Boss), Lime Pictures (Hollyoaks), Lion (Horrible Histories), Objective (Peep Show) and Optomen (Kitchen Nightmares).
All3 was initially backed by private equity firm Bridgepoint Capital, which sold its stake to Permira in 2006.

(This interview is taken from the March issue of Televisual magazine)

Posted 16 March 2011 by Tim Dams

Why do US studios like UK TV?

US studios have bought up vast swathes of the UK production sector, with the likes of News Corp, Warners and NBCU acquiring superindies such as Shine Group and Shed Media Group.

Why are they targetting UK production so aggressively? Here's the opinions of four leading UK execs on the subject:

Thomas Dey
Chief executive officer, About Corporate Finance

The volume of films from US studios has fallen, whilst the costs have risen. This is as a result of consumers demanding more from their viewing experience, and the Studios preferring big branded films that are sure hits. As a result they are looking for other income streams. HBO has demonstrated that long running, high end TV series can be lucrative and the commercial outcome easier to predict than middle budget films. The UK TV production industry has consistently demonstrated its ability to produce long running TV series and equally important, have retained the ongoing rights to such series. The positive impact is the introduction of well funded, global players into a slightly bruised UK industry. The worry is they are hierarchical conglomerates, which culturally might clash with entrepreneurial spirit of UK production.

Mark Oliver
Chief executive, Oliver & Ohlbaum Associates

The UK is one of the main sources of global TV formats, which is one of the fastest growing parts of the global TV sector. US investors are interested in securing IP to programmes they can sell to networks and cablenets in the US (which has a proven appetite for UK formats such as Supernanny, Undercover Boss, MasterChef etc) and as a route to developing local production businesses around the world to exploit those formats globally (MasterChef Australia, MasterChef NZ etc) and to secure more ready-made distribution rights for the global sales teams (selling American Idol to ITV2 etc).

Sue Oriel
Managing director, Firecracker Films

The move by US studios on UK producers is as motivated by business interests as it is by creative ones. The UK sector is populated with highly motivated individuals forming companies to produce and exploit saleable output. The rights position in the UK is more generous than the US (where rights are rarely retained by creatives), so a successful UK company will have programmes to exploit worldwide through sales or format licensing. In the US, talent tends to be an individual issue with fewer talented show-runners starting their own businesses. These two things represent a huge opportunity for studios anxious to globalise.

Nick Southgate
CEO, Shed Media (acquired by Warners last year)

It is clear that Warner Bros think that the UK is a very important market for production. I know they had been interested in playing a role over here for a long time and had been searching for the right partner. I’m glad they found it with Shed. Having a strategic partner like Warner Bros is very valuable in this industry, a partner that understands that value creation comes through linking creativity and business. Warner Bros is committed to the further roll out of its network in other territories, which only goes to strengthen both businesses’ power in the UK. They have been very supportive of our creativity and culture and are encouraging us to add to it with the expertise that a major studio has to offer.

Posted 09 March 2011 by Tim Dams
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