Revenues for the U.K. production sector fell by 14 percent to £2.9 billion ($4 billion) in 2020, according to new data from Pact.
According to the annual Pact Census, U.K. production revenues hit their lowest level last year since 2017. International revenues, while remaining above £1 billion for the second year in a row, were down 13 percent. The biggest hit was in domestic TV revenues, down 13 percent to £257 million ($354 million) as a result of a reduction in primary commissioning spend from the U.K. The report also found that revenues from OTT commissions were up 6 percent to £356 million ($490 million) and secondary revenues increased to over £500 million ($688 million).
By genre, drama commissions were down in 2020 amid the pandemic. Meanwhile, entertainment commissions took up a third of U.K. commissioning spend last year, topping drama as the most valuable genre. Factual-entertainment commissioning spending was up as well.
A separate Pact survey set out to explore the long-term impact of Covid-19 on the U.K.’s production sector. It found that 65 percent of respondents are looking to diversify and 74 percent are eyeing more SVOD commissions.
“The industry has taken a big hit from the pandemic, and we are still in the recovery phase,” said Pact’s CEO John McVay. “The government’s Production Restart Scheme has played an important part in that recovery, and it may take many years for the industry to build back to where it was prior to the pandemic. In particular, smaller, out-of-London companies have been detrimentally affected by the pandemic and with the future sale of Channel 4 on the cards, it’s those indies—who see Channel 4 as one of their primary buyers—who are going to suffer most.”
Hakan Kousetta, co-founder of 60Forty Films and Pact chair, added, “What these findings clearly show is that, whilst the government’s Production Restart Scheme has been hugely successful in getting the production sector back to work, it hasn’t eradicated the severe financial impact Covid has had on the production sector. With SMEs accounting for such a large proportion of production activity, it’s vital that they are able to recover and build back to pre-pandemic levels. Extending the government’s Production Restart Scheme past the end of the year will be essential to that, as will maintaining the existing commissioning ecology. We await to hear from government on any extension, but we are also really concerned that the prospective sale of Channel 4 is going to have a very detrimental effect on an already battered and beleaguered sector.”