BBC Studios Missed Revenue Targets For Commissions From Rival Streamers & Broadcasters

David Tennant and Michael Sheen in 'Good Omens'
Good Omens Amazon

BBC Studios has fallen well short of its targets for commissions from third-party streamers and broadcasters, and is too reliant on old brands like Doctor Who to prop up its revenue.

That’s the verdict of a detailed 43-page report on the BBC’s commercial production and distribution arm by the National Audit Office (NAO), the UK’s public sector spending watchdog.

The BBC spun off its huge production division into BBC Studios in 2016 and two years later merged it with distribution arm BBC Worldwide. A major ambition behind the move was to ensure BBC producers could go out to other streamers and broadcasters and win new business, rather than only serving the BBC’s television channels.

The NAO said the planning that went into creating BBC Studios ensured it made a “good start,” but it found that the commercial entity failed to meet forecasts in terms of the revenue it generated from third-party commissions, such as its Amazon co-production Good Omens.

In 2018-19, BBC Studios predicted it would earn £18M ($23.5M) from third-party commissions, but in reality, it made less than half this, posting a revenue of £8M. BBC Studios is also set to miss its £31M target in 2019-20, with its revenue currently tracking at £22M, according to the report.

Furthermore, the NAO said BBC Studios is not creating enough new shows and is too reliant on old brands. BBC Studios said it would generate £83M of revenue from new BBC and third-party brands in 2018-19, but only made £28M.

Only four of BBC Studios’ top 16 money-making shows in 2019-20 were first produced in the past 10 years. These included David Attenborough’s natural history show Seven Worlds, One Planet, and Brian Cox series The Planets, both of which were delivered last year. The other 12 shows consisted of brands like Doctor Who, Top Gear and Strictly Come Dancing.

The NAO said: “BBC Studios has been less successful than planned in winning new commissions from the BBC and third parties to generate the IP which it can then exploit financially. In 2018-19, it generated production revenue of only £28 million from such commissions, and its successful non-BBC commissions tended to be for small, one-off factual programmes, rather than large drama series.”

The NAO added, however, that BBC Studios “expects significant increases in work generating new IP from 2019-20 onwards” — a sentiment that was echoed by the BBC. Insiders are upbeat about the health of the production arm and the number of external commissions secured, with Ampere Analysis research showing BBC Studios was the most commissioned creator of new content in the UK last year.

A BBC spokeswoman said: “The NAO recognizes that BBC Studios has made a good start and we’re really pleased with the strong progress and performance of BBC Studios, both creatively and financially.

“Under the leadership of exciting creative hires, it is winning lots of new commissions, with over 30 from third parties including Apple, YouTube and Netflix, as well as all the UK terrestrial broadcasters and Sky.

“In total, BBC Studios’ new commissions, which will bolster its growth in future years, are considerably ahead of our original business case. BBC Studios also has a healthy development pipeline.”

The NAO also recognized that BBC Studios has been “more successful than planned in retaining existing BBC work,” winning the contract to produce shows like Songs Of Praise and Mastermind, which were put out to tender by the BBC. BBC Studios forecast that it would generate £315M in revenue for retaining existing shows in 2018-19, but in the end, made £406M.

This article was printed from https://deadline.com/2020/01/bbc-studios-not-winning-enough-third-party-commissions-1202825504/