The Hollywood actors and writers’ strikes have come to an end, but a new chapter for British TV and film may be just beginning.
U.S. studios struck a reported $1 billion deal with SAG-AFTRA, the actors’ union, a move that stands to diminish streamers’ coffers and dent their competitive advantage on a global scale. That could give broadcasters in other regions a chance to gain back some of the market share lost to American streaming giants — and British broadcasters are uniquely poised to seize the opportunity.
Streaming platforms often gain market share off the back of culture-defining shows like Squid Game and The Mandalorian. Now that they have to watch their wallets, the playing field could start to level.
“All non-U.S.-centric production ecosystems and associated distributors will benefit by the increased competitiveness with their U.S. competitors following on from this deal,” says Tim Mulligan, executive vice president and research director at Midia Research.
Britain — with a focus on building up its broadcast video on demand (BVOD) offerings and services that offer original content at affordable price points — is well positioned to win new audiences during this window of opportunity.
Winding down on risk
Meanwhile, the U.S. market is looking for opportunities to consolidate and sustain profits. In such an environment, risk-taking on original but unproven content becomes less appealing and more expensive, especially when the opportunity cost is a sequel more likely to land with a loyal fan base. The promise and ease of live sports and unscripted series could also sway streamers away from producing more expensive original series. from producing more expensive original series.
“It is very unlikely we will see any calendar year exceed the 599 scripted English series that were delivered in 2022,” says Brandon Katz, entertainment industry strategist at Parrot Analytics, adding that “a potential reluctance from Hollywood for content expansion and risk-taking opens the door for international programming.”
And costs for access to U.S. streamers are likely to go up, making them less appealing to both the advertisers and viewers shouldering these increases.
“The increased compensation agreements for talent will result in more expensive production costs, which ultimately mean higher subscription prices for consumers,” says Mulligan. “The most likely scenario here is an increase in unscripted [shows] and more ROI rationalization of scripted-content commissioning.”
British broadcasters meet demand
U.K. BVOD, meanwhile, will offer more reasons for consumers to tune in, and for marketers to follow.
Already, more British consumers than American ones prefer ad-supported streaming. Even though they require a TV license to view, Britain’s cheaper BVOD services are projected to account for more viewers than subscription services like Netflix and Disney+ next year. ITVX may have fewer hours of content than Prime Video or Netflix, but its ad-supported tier is free.
“Consumers are looking for less expensive ways to watch television, and ad-based services are delivering,” says Eric Sorensen, director of streaming video tracker at Parks Associates.
“The surge is even more pronounced for ‘freemium’ services that offer both free ad-supported and premium paid tiers, aligning with the familiar lean-back linear experience, reflecting consumer spending adjustments in the current economic climate,” he adds.
Commissioning for originals in Western Europe rose last year even as it declined in the U.S. Plus British TV and film players have shown willingness to invest in content that resonates not only with U.K. audiences, but also with international ones.
What’s more, the announcement of Freely earlier this year — a joint streaming service between the BBC, ITV, Channel 4, and Channel 5 — is set to add a major new player to the British CTV landscape.
“We would see Freely as a move by the broadcasters to reinforce their position on smart TVs, anticipating regulation by Ofcom around prominence for the U.K. PSBs [public-service broadcasters], and potentially spearheading a new wave of addressability in TV advertising,” says Tim Westcott, senior principal analyst of digital content and channels at Omdia.
Freely will be a welcome addition to available content choices on CTV, while also increasing British advertisers’ options for deploying their CTV budgets. But for the streaming giants, that’s more competition in a sector that is also receiving increasing attention from regulators.
“We are seeing a greater shift towards TV localization 2.0, which ultimately benefits Freely,” says Mulligan, referring to the trend where governments institute localization laws to protect their national TV and film industries.
Moving forward, a combination of new, original content — plus a strong back catalog and price plans that work for cash-strapped consumers — looks to be a more appealing script for success, and one that British broadcasters are already busy writing.