BBC and ITV in talks to launch a Netflix-style streaming service

Subscription video service is likely to focus on providing popular older, archive TV content, not the first-run of shows

The BBC is understood to have held talks with rivals including ITV about launching a Netflix-style video streaming service.

The talks, which are understood to also involve NBC Universal, the owner of the producer of shows including Downton Abbey, centre on the potential to develop a subscription TV service.

The service is likely to mostly focus on providing older, archive TV content, not the first-run of shows, although it is understood there would be a certain amount of original commissions.

While Britons pay £145.50 per year for free access to BBC content, including on the BBC iPlayer, content moves off the service after 30 days.

Older content can be accessed on a variety of services including pay-TV service UKTV, in digital format through the recently launched online BBC Store, DVDs, as well as Netflix, which has shows such as Top Gear.

The corporation and ITV, which also has a 30-day digital TV service and huge scope to exploit an extensive programme archive, have noted the success of services such as Netflix in extending the commercial life of such programming content.

Netflix has more than 75 million subscribers globally. Since launching in the UK in 2012, it has attracted more than 5 million users paying £5.99 a month.

The BBC/ITV plan, which multiple sources have described as at a very early “explore and evaluate” stage, fits into director general Tony Hall’s “open BBC” pledge as part of a reshaping of the corporation for the digital age in the next charter renewal period.

If the service does get off the ground, it could open up a crucial way of further monetising BBC content, an important strategy as the corporation looks to find £800m in annual savings.

Adam Crozier, the ITV chief executive, has targeted digital content exploitation as a key growth driver to continue to reduce the broadcaster’s historical reliance on traditional TV advertising revenue.

Earlier this month at the announcement of the company’s annual results, Crozier said ITV would look to “explore new models for content creation and distribution, through a mix of pay channels and online”.

The broadcaster has invested heavily in building its production arm, ITV Studios, which saw revenues grow a third to £1.2bn and profits up 27% to £206m.

ITV makes a huge range of shows including Mr Selfridge, Come Dine With Me, Coronation Street, Poldark and Hell’s Kitchen, but it does not control the rights to put every show it broadcasts or airs on a new subscription TV service.

“We never comment on speculation,” said a spokesman for ITV.
The BBC’s involvement in any venture would necessarily involve a combination of the licence fee-funded corporation and its commercial arm, BBC Worldwide.

“There is always speculation about what we might or might not do on all sorts of things, but we never comment on such speculation,” said a spokeswoman for BBC Worldwide.

Last July, the BBC scrapped the global version of its iPlayer service, which charged users subscription fees to watch programmes via an app in western Europe, Australia and Canada.

In 2007, ITV, BBC Worldwide and Channel 4 joined forces to attempt to launch an online TV service, the ill-fated Project Kangaroo.

The project was scrapped after competition regulators blocked its development, deeming it was too much of a threat to competition in the then-nascent UK video-on-demand market.

Many observers were surprised at the decision given the rise of US players such as Hulu and the ambitions of Google’s YouTube, and have perhaps been proven correct with the success of US giants such as Netflix and Amazon.

If BBC/ITV can revive a video-on-demand service – without Channel 4 which so far is not involved – it is unlikely to run into competition issues.

Apart from vibrant competition in the market, the new service is not about controlling exclusive UK-originated content, a key issue previously for the regulator, and would not include each broadcaster’s catch-up TV programming service.

Contributor

Mark Sweney

The GuardianTramp

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