Digital players were out in force at this month’s Mipcom TV programme market.

There were keynotes speeches from Facebook and Snapchat, while Mipcom execs revealed that 1,700 VOD and SVOD buyers from the likes of Netflix, Amazon, Hulu through to China’s Youku and Africa’s Showmax were at the market.

The growing presence of streaming players on the international stage comes as they invest ever more aggressively in new content.

Facebook and Apple have each pledged to invest $1bn in content. Facebook announced a number of new shows for its Watch platform at Mipcom, including an English-language remake of Norwegian teen drama hit Skam.

Both Amazon and Facebook have been touted as likely bidders in the next round of Premier League rights sales, which is expected to open by the end of this year. Last month, YouTube’s fledgling SVoD service Red greenlit its first drama from a UK indie, 10-part sci-fi thriller Origin, which is being made by The Crown producer Left Bank.

Netflix, meanwhile, says it plans to spend a staggering $8bn (£6bn) on content in 2018, up from $6bn this year.

A significant portion is being spent in the UK, on factual and drama commissions. Last month, for example,  Pulse Films was commissioned to investigate the disappearance of Madeleine McCann in an eight parter for Netflix, while Fifty Fathoms is making The Eddy, directed by La La Land’s Damien Chazelle, billed as the biggest scripted SVoD commission for a UK producer since The Crown.

The steady increase in spend on UK content by streaming players is proving a boon for indies. Pact’s recent indie Census, for example, reported that producers are seeing strong growth from the international commissions, worth £486m in 2016, thanks in part to orders such as The Crown and Black Mirror from streaming services.

Producers, it seems, not only like the pay cheques that the streaming giants offer. They also say the likes of Amazon and Netflix are good to work with.

The Crown producer, Andy Harries, warned at last month’s RTS Cambridge Convention that UK broadcasters are in danger of losing more top talent to streaming services because they are too interfering during the making of shows.

Speaking ahead of the launch of the second series of The Crown in December, Harries noted that Netflix has signed up talent such as Shonda Rhimes, David Letterman and the Coen brothers to make shows.  “They are attracting all this talent because this is what they are saying to them: ‘Come and make stuff for us. You can do it the way you want to do it. We are going to finance it, you make it.’ And that is what talent wants.” His point was backed up by fellow speaker Andy Wilman, the exec producer of Amazon’s The Grand Tour, which airs its second season next month. Wilman said: “We have no notes – none.”

The streaming services’ increasing investment in the UK market is paying off too, with recent Ofcom figures suggesting they will soon be taking an increasing share of the broadcasting industry’s £13.8bn revenues.

In its 2017 Communications Market Report, Ofcom charted the growth of streaming services, and noted that for many viewers, the days of being tied to a TV schedule are fading. It found that the BBC iPlayer and the ITV Hub were the most popular on demand services, used by 63% and 40% of respondents respectively – followed by YouTube (35%), Netflix (31%) and Amazon (20%).

A recent report by OC&C Strategy Consultants argued that broadcasting could soon be controlled by one or two “super-aggregators” who would act as viewing gateways for consumers looking for a simple way to access a plethora of content.

Traditional broadcasters are starting to feel the pressure. 21st Century Fox chief executive James Murdoch last month acknowledged that Amazon, Apple, Google, Facebook and Netflix are “raising the bar” in terms of the amount that companies spend on content. In a sign that Sky is worried about the rise of streamers, he hit out at them for their lack of investment in jobs in the UK creative industries.

Murdoch said SVoD players make a lot of noise about how much they are investing – but don’t do so over the long term. “They show up, they do a big splashy deal with something and everyone fawns over them and says this is a great thing. There are very few companies that…really invest in thousands and thousands of people on the ground in TV and creative markets like the UK.”

Sky execs also complain that online companies face none of the scrutiny or regulation that affect UK broadcasters. Calling for a level playing field, Sky’s group chief operating officer Andrew Griffiths said at the RTS Cambridge Convention: “Not so many years ago, these companies were small and probably lacked influence. Today, they are some of the largest companies on the planet, with a reach and scale of financial resources far larger than anyone in this room combined. It is a lop sided contest and left unchecked represents a real challenge.”

Indeed, Sky’s proposed takeover by 21st Century Fox deal arguably no longer worries senior broadcasting execs as it once would have. Their focus of concern has shifted over to the digital giants instead.

C4’s outgoing chief executive David Abraham commented: “When I see the scale of the digital giants, my strategic question is: “Is any type of agglomeration of existing legacy media companies ever going to match the scale of what we are confronting?’ I very much doubt that is the case.

“If you are running a media company in this country, you spend more time thinking about how internet TV is going to change the shape of what we are doing.” Abraham added that the “huge global changes” arising from the growth of Amazon and Netflix “have perhaps not been as widely considered by politicians – maybe because they feel they can’t do much.”

It certainly feels like traditional broadcasters are on the backfoot right now. Some commercial channels are cutting programme spend because of falling ad revenues, a point noted by many indies in Televisual’s 2017 Production 100 survey. However, any big drop in broadcaster content spend at this crucial moment may prove a serious mistake, encouraging even more indies to look for business with the deep pocketed SVoD players.

This article is taken from the October issue of Televisual. To subscribe, click here. The article has been updated since first publication to account for deals announced at Mipcom.

Tim Dams

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