UKTV Looks To The Future As They Increase Content Spend To £110 Million

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UKTV – the commercial network which is a joint venture between Scripps Networks Interactive and BBC Worldwide – is having a good year. Following on from becoming the fastest growing commercial network in 2012, the company just this week chose to disclose its year-end financial results for the first time; boasting revenue of £262 million and an operating profit of £71 million for 2012.

The strong financial results come after a period of change for the company. A period of change which began in 2010 with the hire of Darren Childs as Chief Executive Officer. Childs, a former Sony Pictures Television and BBC Worldwide Executive, was brought on with a mandate to drive up the profitability and develop the company’s multi-platform network. Childs assembled a strong team – which included appointing former ITV exec Emma Tennant as UKTV Controller in 2011 just as Scripps bought out Virgin Media’s stake in the company.

With that team in place, Childs oversaw expansion in various areas including the launch of 5 HD variants of their existing channels, the launch of video-on-demand services, carriage agreements with Talk Talk and BT Vision, a distribution agreement with YouView to supplement existing linear and on-demand platforms, increased international sales with UKTV now selling 100 titles to 200 countries, and the shutdown of Pay channel Blighty, which paved the way for the launch of the free-to-air channel Drama, which has reached some 9 million viewers since its launch in July 2013. There has also been various rebrands such as the re-design and re-introduction of the UKTV brand on-screen – so as to allow viewers of the 10 channels to associate them with the company brand, as a whole.

Under the leadership of Childs and Emma Tennant – who, as Controller, is responsible for the company’s editorial and brand leadership – UKTV has also made a significant push into originals, with the company vowing to spend £110 million on commissions and acquisitions in 2013. That push has seen the commission of Red Dwarf X for Dave (which pulled in over 2 million viewers for its first episode) and Yes, Prime Minister, The Comic Strip Presents: Five Go To Rehab, Bring Me Morecambe & Wise and the more recent You, Me & Them for Gold. Another big hit for UKTV’s Watch channel has been Dynamo: Magician Impossible which consistently pulls in more than 2 million viewers. On the acquisitions side there have been hits and misses. US imports Grimm and Alcatraz pulled in huge audiences for flagship entertainment channel Watch, with Grimm averaging 0.7 million viewers in its most recent season, while Alcatraz still holds a record as UKTV’s most successful US scripted import with the premiere episode attracting an audience of 1.6 million viewers. But others, notably Alibi’s White Collar, have been less successful.

It is those added distribution venues, increased international sales and the recent original content push, that led to the strong financial results UKTV released earlier this week. In summary those results included the following facts: UKTV has seen a significant rise in viewership; with the company now reaching 42 million viewers every month – up from the 37 million when Childs took over in 2010 – and with viewership up 10% from 2011. UKTV also recently saw the SOCI (share of commercial impact) figure hit an all-time high, with the company taking 9.17% of the total market in August. Another key metric boasted by the company was that Dave is now the largest non-PSB channel in the UK. That all led to the recent £10 million budget increase for original content. There is no doubt that UKTV, posting record growth, is a broadcaster in success. But now what?

One only has to look across the pond at AMC, which is home to ratings juggernaut The Walking Dead, to see that a network registering huge success can quickly falter. This past month, AMC made a number of missteps. On the heels of Breaking Bad doubling the size of its audience from 2012, the network’s newest series Low Winter Sun has been dropping like a stone. Concerned with the prospect that their hit-making days were behind them, AMC turned to signature series Breaking Bad and The Walking Dead for spin-offs that could plug some holes in the schedule and come with built in audiences. And just yesterday, AMC decided to split the final season of Mad Men in two, ostensibly extending the life of the series by another year. All of which screams of a network running away from itself. Could UKTV be looking at a similar future?

Probably not. AMC’s problems have been driven by well documented issues with the creatives behind their series. Those instances have included stand offs with Matthew Weiner over Mad Men, a similar stand-off with Sony over Breaking Bad in which SPT threatened to take the series to another network and the firings of Frank Darabont and Glen Mazzara as showrunners on AMC’s The Walking Dead. UKTV on the other hand, which is slowly changing its reputation in the industry as a place for creatives to pitch their ideas, is “very respectful of the creative process”, says one producer who worked on one of the company’s recent scripted efforts, before adding that their commissioning team were “great to work with.”

That became apparent when Tony Jordan, Managing Director of Red Planet Pictures and creator of such series as Life on Mars, pitched Legion – which he described as a “passion project” that had been 15 years in the making – to UKTV, who almost immediately committed to producing the series, which is about a father who makes a deal with the devil to save his child. UKTV is betting big on Legion which, according to one source, requires a “huge budget.” Having attracted a creative as well-known as Jordan is certain to help UKTV’s perception amongst others in the industry and will open the doors for more to follow. As the company looks to the future, continuing its rapid growth trajectory, the increased budget will allow UKTV to spend more on commissions and acquisitions; enabling the company to position itself as a premier provider of content for UK audiences. UKTV has also said that they will also continue to invest in Channels & Digital, and recently expanded its services into the Republic of Ireland. With all that in mind, things are looking bright for UKTV, not to mention creatives and audiences, as well.