UK TV content spend highest per head in the world

LONDON: Investment in new, quality programmes on British television is the highest level per head in the world. Overall market investment is also encouraged by strong public funding which benefits audiences as both citizens and consumers.

These findings are contained in independent report, by Mark Oliver of Oliver & Ohlbaum Associates. The report titled UK Television Content in the Digital Age was released yesterday. It concludes that the $75 per head spend in the UK, compares to $65 in the USA, $52 per head in Germany, $43 in France and $26 in Australia.

The current high investment enables the UK's TV industry to play a prominent role in reflecting and reinforcing UK culture and national identity, says the report, commissioned and published by the BBC.

Despite the significant economies of scale enjoyed by the USA in television production and global exports, three quarters of UK television content is currently home grown. This compares to only 20 per cent in the film industry where the USA dominates 80 per cent of movie consumption in the UK.

But investment in domestic TV production could drop by 60p per pound for every £1 reduction in the BBC's public funding, hitting high cost drama, documentaries and scripted comedy in particular. Reallocating public funds to other commercial broadcasters is also highly likely to result in a fall in the total amount invested in UK content production, says the report.

The UK's strength in homegrown television content investment stands at £3 billion per year. This is underpinned by the BBC's investment which accounts for 40 per cent of this total, says the report. ITV also plays a central role maintaining original production at 20 per cent above the level legally required. ITV, Channels Four and Five combined account for £1.3 billion of programme spend a year  43 per cent of all domestic content spend, while pay TV in the UK recycles only 3 per cent of revenues into new UK productions.

However, the report warns of pressures on the UK's unique broadcasting model of market intervention and regulation which ensures diversity, range and investment and encourages creative competition across the industry.

Audience fragmentation, increased competition for commercial revenues and possible future pressure on advertising premiums, will threaten investment in original, diverse content by the UK's main commercial broadcasters. Channels Four and Five may increasingly attempt to compete directly with ITV for mass-market audiences. At the same time ITV may be forced to reduce its originations to the legal minimum, says the report.

New legislation and ownership rules could also mean a single dominant owner of commercial TV networks will place more emphasis on diversity between its networks than on original content investment. "In these circumstances, the nature and structure of public funding will have a pivotal role in underpinning both total content funding and preventing dilution by the commercial networks," says the report.

"The presence of a well-financed, publicly-funded broadcaster the BBC has helped ensure that each commercial TV channel needs to invest significant amounts in new content to protect its audience share. Far from crowding out investment in domestic programming by commercial TV, the BBC may well encourage such investment."

"This also increases barriers to entry in the commercial network TV market which prevents revenue fragmentation and further pressure on programme budgets" the report adds.

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