ITV has shifted focus to “aggressively pursuing talent deals”, according to CEO Carolyn McCall, who said the UK outfit is more lukewarm on straight acquisitions and has turned some down “because they were not the right economics.”
Speaking during a two-hour investor conference this afternoon following the release of producer/distributor ITV Studios’ five-year masterplan, McCall and ITV Studios MD Julian Bellamy pointed to recent high-profile talent deals. The likes of It’s A Sin exec Nicola Shindler launched her Quay Street Productions banner with ITV Studios and Industry exec David P. Davis’ fledgling 5 Acts Productions is also backed by the producer/distributor. Shindler was referenced several times during the investor call, which featured contributions from multiple ITV execs.
Bellamy set out the thinking in further detail: “In order to continue to attract the best talent, you have to be flexible. Talent deals can range from a conventional employee deal to something much more entrepreneurial where a creative shares in the value of their venture.”
While ITV has shifted focus to “aggressively pursuing talent deals”, McCall said the outfit has “turned down some acquisitions because they were not the right economics.”
“We value potential acquisitions on pipeline as well as what the company has produced,” she explained. “There’s no point buying a label that only has a catalogue – you want to see interesting stuff in their pipeline.”
ITV Studios’ five-year strategy is focused on scripted and streamers, with plans to double scripted hours to 400 and increase proportion of streamer revenue from 14% to 25% by 2026.
Speaking to journalists earlier today, Bellamy stressed that picking up more work from streamers won’t mean ITV Studios loses out on back-end rights as “not all streamers are the same.”
ITV Studios is, for example, retaining the underlying distribution rights for AppleTV+ drama Physical, while it regularly licenses shows from its archive to SVoDs around the world.
“Each streamer has a different footprint and a candid approach to rights and ownership,” said Bellamy.
ITV Studios will not drop the number of shows it makes for linear broadcasters even as it supercharges streamer revenue, he added, with planned overall growth set to cover for both areas.
ITV Studios is targeting 5% revenue growth over the next five years and an adjusted EBITDA margin of 13% to 15% over the medium term. The producer/distributor’s revenues grew by 32% to £1.2BN for the first nine months of 2021.