The UK television sector needs ‘radical consolidation’ of its major players to become attractive to investors again, claims Access Entertainment boss Danny Cohen.
Danny Cohen
Television executive-turned-financier Danny Cohen believes the dominance of US-based platforms and technology companies in the global media industry is causing investors to shy away from backing legacy TV outfits in the UK.
Cohen is the president of arts investment firm Access Entertainment, a division of businessman and philanthropist Len Blavatnik’s global investment company Access Industries. The company has stakes in a wide variety of entertainment, from TV and feature films to live theatre productions, gaming and the creator economy.
However, Cohen says that economic headwinds and macroeconomic factors are deterring companies such as his from continuing to place bets on prodcos, studios and networks working within the traditional TV sector. “We’re investing less in television because of four key pressures in the traditional side of the industry which are very challenging,” he says.
“The first is US platform dominance and the way that both value and financial outcomes shift up the chain towards them, and the second is [disruption caused by] AI. The third is that consumer attention spans have become diluted by TikTok and Instagram reels. It’s fascinating to see the growth of YouTube to become a dominant player alongside Netflix. I’m not sure too many people predicted that a while ago.
“Finally, the fourth factor is the rising cost of production, which is making it harder and harder to get stuff made. All of those pressures are particularly challenging to Britain and other European countries because of the dominance of US platforms and tech companies,” Cohen adds.
Cohen speaks from the experience he gained working at the heart of the legacy media sector. He was previously the director of television at the BBC and has held posts as controller of Channel 4’s youth-skewing network E4 and head of documentaries at Channel 4.
He left the BBC in 2015 and the following year was hired as head of Access Entertainment and given a war chest of several hundred million dollars to invest in entertainment media globally.
Access backed BBC Holocaust doc The Last Musician of Auschwitz
As Cohen sees it, the UK television sector’s problem is scale – or, more accurately, a distinct lack of it. The decline of the domestic linear TV sector in recent years has led to calls for the four major broadcasters – the BBC, ITV, Channel 4 and 5 – to combine resources to stand their ground against YouTube and the global streamers.
In May, former ITV chairman Peter Bazalgette called on the public service broadcasters (PSBs) to put aside their historically independent philosophies to ensure they survive in a rapidly changing landscape. UK media regulator Ofcom has also urged the PSBs to engage in “strategic partnerships at scale” to safeguard their futures.
However, the RTS Cambridge Convention in September saw channel chiefs including ITV CEO Carolyn McCall and 5 president Sarah Rose reject calls for UK broadcasters to merge, citing differing editorial and commissioning strategies.
Cohen is watching with interest Comcast-owned Sky’s £1.6bn (US$2.1bn) bid for ITV’s media and entertainment division, which houses its TV channels and streamer ITVX. He believes that only major M&A activity in the UK television sector will help it to compete with the bigger international players and attract large-scale investment once again.
“We need some radical consolidation in the UK’s creative sector and it’s going to need some brave steps to do so,” he told delegates at the British Screen Forum Conference in London this month, during a panel session titled Financing Our Frontier Industries. “In the US, we see Paramount, even with its scale, wanting to buy Warner Bros because they know they need to be bigger. The UK has nowhere near that scale. We need more condensed money and reduction in cost through synergies in order to help producers to compete in the long term.
Israeli drama series Red Skies
“The [potential] Sky/ITV merger has a lot of positives about it because we need more scale. What can the BBC and Channel 4 do? I really think we’re going to continue to struggle unless we can consolidate quite radically. We need to let go of what we think these institutions have to be and concentrate more on what they need to be to in order to survive in the future.”
During Content London three years ago, the story broke that Access Entertainment had invested in US indie studio A24, which produces shows such as HBO teen drama Euphoria and Netflix comedy-drama Beef. Access and Warner Bros Discovery also collectively hold a 26% stake in Israeli broadcaster Reshet 13.
Last year, Access funded BBC Arts’ Holocaust feature documentary The Last Musician of Auschwitz, produced by Two Rivers Media, and it has also backed military thriller scripted series Red Skies, for Reshet 13.
While Access maintains interests in traditional TV and film production, the company is increasingly looking towards some of the new generation of media disrupters bursting on to the scene. “We invest a lot in the creator economy and at the moment we’re looking at microdramas,” Cohen says. “There’s a huge number of microdrama start-ups on the cusp at the moment. We’re also working a lot in shortform content and gaming.
“We’ll continue to do the traditional stuff [TV and film] because we love it and we think we can be successful in it, but it’s getting harder, for the reasons already discussed.”
