D2C for the BBC is a no brainer overseas, analysts Alex DeGroote tells TVBEurope
By Jenny Priestley
Published: September 18, 2020
D2C for the BBC is a no brainer overseas, analysts Alex DeGroote tells TVBEurope
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BBC director general Tim Davie has said it's time the BBC looked properly at direct-to-consumer products as it looks to lift its commercial revenues.
Davie was speaking to RTS CEO Theresa Wise as part of the organisation's Digital Convention 2020.
Asked where Davie sees areas of priority for the BBC to grow its commercial revenue, David said he believes so far the BBC has made great progress but isn't necessarily firing on all cylinders.
I think the migration from linear to on demand says how do we begin now to get into direct to consumer services in the right way? he added. By the way, that is a difficult thing because you don't generate a lot of profit short-term on that. But building that for the long-term future of the BBC, and we've seen with BritBox we've got ourselves a nice business there, there is real opportunity across many of our fronts to look now properly at D2C businesses.
There might be other areas, I've got some thoughts in my head that I'll keep to myself, but there are others areas where we could get growth. I'm quite bullish about what we could do around commercial income, added Davie.
Alex DeGroote, independent media analyst, tells TVBEurope that the fact Davie is talking about D2C is not a big surprise as it has become a well-established mega trend in the sector in recent years.
The opportunity would be overseas not in the UK and everything Tim Davie said so far, in my opinion, suggests that he believes there is a medium term commercial opportunity in BBC Studios, or overseas for improved commercialisation of the BBC. He's a commercial guy with a commercial background and he tends to think of revenue. He probably knows that in the UK they're a bit hamstrung in terms of their ability to monetise their content, because it's a PSB. He just gets bogged down in the never ending debate about the licence fee but overseas that's much less of an issue, and the BBC has more than enough content to make it work, adds DeGroote.
Asked if this is a way for the BBC to increase revenues while dealing with the turmoil of the over-75 licence fee payments, and seeing #DefundTheBBC trending on social media every day, DeGroote says the corporation is starting to lose licence fee at an alarming rate.
We know that decriminalisation of the licence fee is imminent so you can expect to see the number of non-paying licence fee households go up a lot. At the moment just over 25 million households pay the licence fee. You could see that fall by millions over the next two or three years. That is going to really hit them very, very hard in the UK, so they do need to find alternative sources of revenue and there is a need to implement a DTC revenue strategy in overseas markets. You could end up with a weird situation where in the UK the BBC is totally on the back foot, but overseas it's actually doing quite well.
I suspect Tim Davie is well placed to execute a good overseas commercial grid strategy. It's a market he gets, we know there's demand for D2C and we know that the BBC has the content people want to watch. So D2C for the BBC is a no brainer overseas for sure, he concludes.
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D2C for the BBC is a no brainer overseas, analysts Alex DeGroote tells TVBEurope
