Opinion
Indie focus Budgets in the balance
First, the good news. Last month, Televisual’s survey of independent production companies – the Production 100 – revealed that a majority of indies were feeling a little bit more upbeat about business than they have in recent years. Most producers said the TV market is still incredibly challenging and competitive to work in, but felt that business was currently steady or going through a slight upswing. A ringing endorsement of a thriving market it certainly wasn’t. But it was the first time in at least two years that indies had even expressed cautious optimism about the business climate. Now for the not so good news. Amidst this overall flat to improving picture, producer grumbles about falling budgets reached near fever pitch. A resounding 69% said budgets had fallen over the past year. Cash strapped broadcasters have been passing on their financial pains directly to producers. Some broadcasters have been offering producers the same budget contributions (which means they’ve fallen in real terms), while many others have been paying notably less for programming. All, of course, expect the same if not higher levels of quality on delivered programmes – despite the lower budgets. On one level this makes some sense. Camera and kit prices have fallen drastically in recent years, so it’s fair for broadcasters to expect some of the cost savings to be passed on to them. But by far the biggest cost in making programmes is people, not kit, and they haven’t got noticeably cheaper. Meanwhile, budget negotiations between broadcasters and producers have become much tougher. Many indies complain about the aggressive contract negotiations they often become embroiled in. With less money on the table, it’s now common for independent producers to have to finance significant production deficits – which are only recouped if the programme is a commercial success. Recent estimates from producers alliance Pact show that producers contributed over £200m to programme budgets last year in the face of broadcaster shortfalls. All this means that producers are watching the bottom line more closely. Controlling costs in the face of falling licence fees has now become of paramount importance. Unfortunately this budgetary pressure is only going to become more
acute. The BBC’s recent decision to freeze the licence fee for the next two years means that £144m will effectively come out of its overall income. That’s more than Sky spends on new commissions each year. As a result it’s likely that the BBC, by far the UK’s biggest commissioner, will bring even more pressure to bear on budgets. These, of course, are already under considerable strain as a result of the BBC’s 5% year-on-year efficiency targets. Little wonder that there is widespread concern among programme-makers that there is now limited scope for more cuts without serious risk to editorial quality.
Producers are more upbeat upbeat about TV production but face the challenge of plugging the gap of falling budgets
TIM DAMS Editor, Televisual Tim Dams is editor of Televisual, and was previously assistant editor of film title Screen International. He’s also written extensively for The Guardian, Broadcast and Media Week.
in my view Autumn 2010 theproducer 7
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