Soaring production costs of more than 10% a year have created “intense pressure” on producers in the UK, according to All3Media CEO Jane Turton.
The increased cost of producing through the pandemic, coupled with the rising demand for staff during a spike in production, has created substantial inflation and Turton, speaking at the Royal Television Society Cambridge Convention admitted that conditions have been “difficult”.
“We are under intense pressure for some very good reasons – there’s a skills shortage and we’re facing rampant inflation of at least 10% year-on-year,” the All3 boss said. “Then if we look at the buyer community, they’re not increasing tariffs and on we also have this semi-out of Covid but not quite situation, which is difficult.”
Ralph Lee, chief exec at BBC Studios Production, added that his company had faced similar skills shortages this summer and said there were rising costs for behind-the-screen staff.
Lee added that BBCS had been attempting to produce seven dramas during the summer but had been forced to delay one production because of a crew shortage.
Sanjay Singhal, CEO at Voltage TV, added that he had also seen rates for directors soaring this year while further financial pressure was being created by “contributors wanting back end, for example”. This, he said, was “unprecedented” in the UK industry and was creating further pressures.
Yet one of the reasons for the surging demands on production – the launch of US-based streamers such as Peacock, Disney+, Paramount+ and HBO Max – is also providing a boon for UK and European prodcos.
Turton summed up the situation as a “short term challenge” that promised many positives in the long term, but demands for rights from these US entrants is likely to cause ongoing tensions.
The All3 boss and BBCS’s Lee said their companies were better able to withstand the pressures of streamers taking all rights because they could adopt a “portfolio approach” across their range of output, as Turton put it.
“We’re running commercial businesses at the end of the day and we have a creative focus but we don’t have to sell the show [to a streamer]. We have to be a bit grown up about this and accept it is complex.”
Brandon Riegg, VP of unscripted & docuseries at Netflix, said his streamer was approaching deals on a bespoke basis.
For his unscripted side of the business, Netflix has “no singular way we approach the business”, he said, adding that all rights and format remakes would be sought for some shows while other there could be regional or territory deals.
“For unscripted formats, it’s not dissimilar to what has existed at MIPCOM. If [All3 CEO] Jane comes to us and sells us a format then we are incentivised to make successful versions in partnership and I’m not sure you’re conceding anything more than if you’d sold to a US network.
“If you have a Too Hot To Handle, we can do six, seven or ten versions of that – and that’s good thing for producers.”