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BBC Studios will invest “tens of millions” of pounds searching for the next Bluey in a fresh push into family television production and the relaunch of its commercial UK TV stations and US digital services.
Tom Fussell, chief executive of BBC Studios, the commercial arm of the national broadcaster, told the Financial Times that the company’s investment plan would push down overall profitability this year but leave the group well positioned to reach a target of doubling revenues by the 2027-28 financial year, when the corporation’s charter is up for renewal.
“It’s not the billions that the streaming services are spending on their tech, but for us it’s a material amount of money,” he said in an interview with the FT.
BBC Studios is taking on increasing importance as a debate rages over whether the broadcaster should remain funded via a universal licence fee or should rely more on commercial revenues from subscriptions or advertising.
BBC Studios in effect does both of these things already both outside the UK — such as through its US TV streaming or news website — or in the UK via advertising funded UK TV channels such as Dave and Gold.
On Friday the BBC struck its largest acquisition deal, buying UK broadcaster ITV’s 50 per cent stake in BritBox International, a subscription streaming service that broadcasts popular shows such as Death in Paradise in the US, for £255mn.
As part of its growth strategy, BBC Studios has also increased its debt facility with a consortium of commercial banks from £350mn in 2022 to £600mn this year, the FT can reveal, and has government permission to take this up to £750mn by 2027.
BBC Studios produces its own shows and invests in other companies’ programmes which it then sells around the world, such as the various natural history shows presented by Sir David Attenborough, Doctor Who and the immensely popular children’s programme Bluey.
Fussell said that the company would now invest more in UK TV, as well as in the BBC’s US website and app, which brings together news and sport in the country, ahead of the election. “We’re investing heavily in the content and the marketing of UK TV play — there is a big rebrand coming up,” he said.
Fussell said that BBC Studios also wanted to invest in new shows and production companies through intellectual property such as character rights and book rights owned by literary estates that it could use for new programmes.
However, he is as excited about the existing characters in shows currently produced by BBC Studios, including Bluey, in which it owns the global merchandising rights.
“Bluey is the most streamed kids show in America at the moment, the second most streamed show in 2023,” he said. “We make all the sales, there’s a profit stream and everybody participates.”
Fussell said that BBC Studios would “really go out to the market” to develop new kids’ and family shows. It will also produce more work for streaming platforms, he said, flagging a number of shows such as Einstein and the Bomb and The Gentleman that the company made for Netflix.
Disney would start marketing a new series of Doctor Who in May, he said, with the deep pockets of the US streamer marking a fresh start for the popular programme.
“Disney has invested a hell of a lot of money into that show, as has the BBC. So the editorial ambition has gone up a big notch with an amazing cast and amazing writer. It’s got new talent, and it’s got Disney behind it. You can never call it but it’s got everything behind it. That should work.”
Doctor Who will show on Disney+ around the world apart from the UK. “The licence-fee payer gets it in the UK,” Fussell said. “Disney are really going to go for the launch later this year, as the next season comes.”
Fussell’s target is to take revenues by the end of the charter in 2027 to £3.2bn, with returns for BBC Studios of £450mn. He admits that this is far short of the £3.8bn in income generated by the licence fee last year, however.
Fussell’s plans will be a welcome boost to the UK’s creative industries, which have been hit by last year’s strikes in Hollywood, a slowdown in commissioning by large US streaming services and funding cuts on Britain’s public service broadcasters.
He insisted the BBC would continue to invest in new productions despite a commissioning slowdown by the streaming platforms, which are among BBC Studios’ biggest customers.
“We produced or distributed eight out of the 10 top shows in this country last year,” Fussell said. “Our mandate is to grow sustainable long-term commercial returns for the BBC that gives us real clarity that we can take long-term bets.”
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