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British TV Companies Join Forces to Fight U.S. FAANGs

The FAANGS have rumbled into London and parked their tanks on the lawns of Britain’s traditional players, sending the incumbents fighting to protect their turf.

Borrowing from the playbook of an earlier wave of U.S. giants — the Hollywood studios — Amazon, Apple and Google (via YouTube) have set up content arms in the British capital, exploiting its advantages of language, location and infrastructure. Facebook and Netflix don’t have the same boots-on-the-ground presence in London yet, but their impact, too, is being felt.

The growing clout of what the BBC calls the “West Coast giants” has rung alarm bells at the pubcaster, which considers the competition for eyeballs a David-versus-Goliath battle. As the world’s largest pubcaster — with an income of £3.7 billion ($5 billion) — the BBC is more usually cast as Goliath. But against the mighty FAANGs, it considers itself the underdog and, along with other British broadcasters, has sounded a call to arms.

Amazon and Netflix have invaded more than a third of U.K. households, with about 8 million and 4 million subscribers, respectively, British media regulator Ofcom noted in a report this month. The newcomers lie beyond Ofcom’s regulatory reach, but the agency has urged U.K. players to work together to combat them. It says it will factor in “the intensity of global competition” when scrutinizing partnership proposals that cross its desk.

Some hookups have already come about, such as the BBC and ITV’s “best-of-British” streaming service Britbox, which offers a mix of content, mostly from the U.K.’s two largest TV providers, and which has 250,000 subscribers. Acknowledging the changed landscape, newly installed ITV CEO Carolyn McCall told a gathering in London last week that “there’s going to be more collaboration between the British broadcasters than there’s ever been.”

Amazon and Netflix are both competitors and customers of Britain’s traditional players, whose content the streaming giants have bought. They have also occasionally been co-production partners with the BBC and others. Despite not yet having a London-based content outpost, Netflix has made major inroads in Britain with the U.K.’s biggest-budget drama, “The Crown.” Amazon’s “The Grand Tour” similarly has set a new bar in the unscripted realm.

The newcomers are also poaching homegrown talent. Former Channel 4 programming chief Jay Hunt was snapped up by Apple as its new London-based creative director for Europe. Georgia Brown, a former exec with BBC Worldwide and Fremantle-
Media, is Amazon Prime Video’s chief of original content for Europe, working out of the company’s new headquarters in London’s trendy Shoreditch district.

Brown says that Amazon offers writers and producers something the traditional players don’t: “a chance to find a unique voice and take risks in a way that they would not have been able to do with linear broadcasters. Competition is healthy, and contributes to a stronger output of television.”

“The global media landscape is likely to be dominated by four, perhaps five busi-nesses on the West Coast of America.”
Tony Hall, BBC

Facebook is acquiring and commissioning work for its Watch platform, with U.K.-based Barcroft Media among the first producers to provide content for it. “Because it is not network-based, if a show goes out and people get into it, as a producer you can build a brand in a way that’s difficult to do on a channel,” says company founder Sam Barcroft.

Barcroft’s outfit has also worked extensively with YouTube. Additionally, the Google-owned platform has sci-fi thriller “Origin” from Left Bank, the British producer of “The Crown,” for its Red subscription service, and unscripted show “Training Days,” from James Corden’s London-based Fulwell 73, for its ad-supported platform.

YouTube says 84% of watch time of U.K.-produced, ad-supported content comes from outside the country, which proves its global appeal. “The U.K. is the second-largest exporter of video content globally, behind the U.S.,” says Richard Lewis, YouTube partnerships manager for the British Isles. “The U.K. is also a barometer of what’s to come in other markets, whether that means burgeoning trends or emerging musical artists.”

In a speech to staff last week, BBC director general Tony Hall warned of the increasing influence of the new media players. “We can see now, more clearly than ever, that the global media landscape is likely to be dominated by four, perhaps five businesses on the West Coast of America,” Hall said. “These are global businesses determined not just to produce their own content but to control how it’s distributed and marketed right around the world through their own branded gateways.”

Tony Gunnarsson, principal analyst at Ovum, says traditional TV companies should capitalize on their local knowledge to reach viewers in a way that the FAANGs either can’t or won’t. “They should also leverage existing relationships with local talent and producers to work for and with the FAANGs by helping with their production efforts,” Gunnarsson says. But he adds one piece of advice: “Save the best scripts for yourself.”

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