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BBC Worldwide, BBC Studios to Merge Into Single Operation

The BBC announced Wednesday that it will merge its commercial arm, BBC Worldwide, with its production arm, BBC Studios, into a single operation under the name BBC Studios.

The move will make the BBC’s organizational structure match more closely the integrated model of other major players in the British entertainment industry, such as rival broadcaster ITV and Endemol Shine Group, the BBC said. The new BBC Studios will follow a single business plan and be headed by Tim Davie, currently the chief of BBC Worldwide. Mark Linsey, boss of the current BBC Studios, will become the combined company’s chief creative officer.

“At a time of an increasingly competitive and global market for production and distribution, this new organizational structure will bring the BBC into line with the rest of the industry, integrating program production, sales and distribution in a single entity,” the pubcaster said in a statement. “It will ensure the BBC is best placed to succeed both creatively and commercially and will better serve license-fee payers.”

BBC Worldwide works primarily in content financing and sales of programs, including global hits “Sherlock,” “Doctor Who” and “Blue Planet II.” BBC Studios is the broadcaster’s main production arm, and is allowed under new rules to produce shows not just for the BBC itself but for third parties.

In particular, the BBC said that the combined operation would help it continue to create uniquely British content, which Director-General Tony Hall contends is under threat by the advance of global streaming services such as Netflix and Amazon. “In a fast-changing TV industry, securing the future success of the BBC is vital,” Hall said. “Creating a single BBC Studios will bring the BBC in line with the industry, be simpler and more efficient. It will help ensure that license-fee payers in the U.K. continue to receive outstanding British programs which reflect British lives long into the future.”

The BBC receives about $5 billion a year from the license fees that all TV-watching households in Britain are obliged to pay. The current license fee is about $200 for a year.

Both BBC Worldwide and the current BBC Studios are commercial subsidiaries of the pubcaster. The new combined BBC Studios is to begin trading April 1, 2018, and will boast about 3,000 permanent staff, six production bases in the U.K., and operations in 22 markets.

In 2016-17, BBC Worldwide made headline profits of £157.3 million ($210.8 million) and headline sales of £1.05 billion ($1.41 billion).

“Creating one company, in line with market norms, is a natural step in this market,” Davie said. “The new BBC Studios will be focused on the highest-quality British content, underpinning our future financial return to license-fee payers.”

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