by Gary Knight

 

Good Evening, good People of these fair Isles & beyond.

I do not normally add a blog so swiftly after my previous posting, but on this occasion the ‘desire’ was too strong. In essence this is really a ‘blog addendum’ to my recent views on Carolyn McCall’s first ‘Vision Statement’ in respect of her strategy for ITV across the next 3 years.  Hopefully many of you will be on a sun kissed beach or , much better, walking along the delightful Jurassic Coast on a staycation! If you have not managed to read that first instalment, then you can do so here.

My second episode follows so swiftly due to the ‘flood gates’ of the Nile having been opened by our Sun Queen so swiftly & frequently in the past week.

As a first up view I am delighted that Dame Carolyn, unlike previous occupants of that role, has followed up with some ‘juicy morsels’ to show that her plan is an active rather than passive one. Most impressive…

Let’s have a gander at the menu items & ingredients that have been unveiled to date .

360-degree Commissioning: long overdue & desperately needed in a modern content ecosystem. Our Sun Queen highlights four specific areas :

  • Closer ties between ITV Studios & the ITV Network
  • The need to improve IP monetisation
  • Performance based metrics attached
  • True Brand Management

At this stage I need to shout a massive ‘hoorah’ to all this !

Carolyn has also admitted that there had been ‘several goes’ at this in the past …but they never got anywhere. Without breaking any trade secrets, I can add to this in that …yes, there were many an attempt to drag ITV into modern Brand management , but the political waters of such attempts were always diverted into muddy sewers. So, let’s knell down , bring our hands close to our chest & bow to the ground to wish her well on this journey. It is essential she succeeds in this task.

I was particularly frustrated at ITV’s lack of desire to put a true monetary value on their main content brands. Where else would a CEO not be able to pick up a piece of paper & see a true valuation , a true P&L, a true state of health on such iconic brands as Coronation Street, Emmerdale, I am a Celebrity NGMOH, The Chase, This Morning, Saturday Night Takeaway & Love Island? Is it not the case that the heath & wealth of such brands gives you a true insight into the health of ITV itself ? I can buy why you might not choose to include such valuations on your company assets sheet etc…. but where would Cadburys be without knowing the value of CDM ? However, not to fully understand such a position , at least from an internal perspective remains a mystery. Brand Management is not a dark art, left alone to the alchemists…let’s wish our Sun Queen well in her battles to bring this discipline firmly embedded into the DNA of the ‘new ITV’

the ITV Hub will finally be treated as a ‘Channel’

This is good news as they have put the Commissioning Controller of Digital Channels, Paul Mortimer , in charge of commissioning content for the Hub, Common-sense has shone through ! Of course, the Hub is a Channel, my 20-year-old son never states  “Oh I  fancy watching some catch up on the ITV Hub “…he simply goes directly to his favourite show , that he wants to watch at any time on any device. 360-degree commissioning would never really work without a decision such as this… it may be very late in the day, but it is a decision. Hat’s off to this.

>The  appointment of a CTO ( Chief Technology Officer ) & CTD ( Chief Data Officer ) is another welcome sign that  ITV is finally trying to build long term robust relationships with its customers. Again, long overdue but at last some action. My contacts in Head Hunting land tell me the job briefs are very robust as well.

£10 million Drama Investment Fund announced 

The tasks for this being :

  • grow creative talent
  • improve pipeline of shows
  • increase monetisation capabilities

I do not want to say much on this area other than it feels too vague & looks like too few £s in a programme genre, that along with Live Sport, will dominate the Content Viewing market for years to come.

Pan Broadcaster SVOD creation

This has woken up the good people of our Ad/Broadcasting fraternity in a frenzy like state, with various commentators but also lots of sage words from people referred to as ‘ ITV ex’s ‘, or ‘BBC Store ex’s’ or ‘ Studio ex’s’…. goodness me, I had no idea that this level of paranoia/secrecy existed around an open market SVOD discussion!  Even poor Nicola Walker, one of the lead actors in ITV’s excellent drama series, ‘Unforgotten’ , would have turned to the camera & uttered the immortal words : ” do you know what, I think I need a drink “. So, what to make of it all ?

  • These wise sages announce that  a successful PSB jv needs to focus on premium content, distribution & pricing. Amazing ! I have always said that any business has only 3 elements at its core-Manufacturing, Distribution & Commercialisation. Fantastic that everyone now gets this.
  • In a cluttered VOD market, you need to invest heavily to win the global game. Yes,  I agree with this …how do you do this ? Jeremy Darroch at Sky offers up some sound advice… as well as having fantastic first run content, exclusive first run rights plus 000s of hours of box sets & archive programming…you also need to be experts in the files of consumer insights, data, churn management, customer service , loyalty programmes & brand development. You can pause here…as I add to you also need to spend a bugger load of money on marketing & maintain a huge SOV within the market.
  • There is going to be a massive punch-up on Rights. With so many varied & complex rights maps to unlock, particularly with third party producers, then the road ahead looks ‘rocky’ rather than less travelled.
  • The way this market is priced , be it SVOD, AVOD or TVOD has become too staid, quasi-institutionalised & needs a more flexible approach. Seems to make sense to me.
  • Can a collaboration of ‘would be partners’ who are also enemies work ? Some clues are tied to trees in comments referencing the France TV, ZDF & RAI agreement on a co-production pool to counter spiralling US dominated SVOD budgets.
  • In Germany Discovery & ProSiebenSat 1  have also announced a paid for programming hub that will also include content from rival Broadcasters

Thus, dear Boys & Girls, all this really points to is that the ‘Game of Thrones’ in respect of SVOD & wider Content Viewing ( plus required monetisation ) is well under way. The Quest to control the ‘Iron Throne’ is the ultimate prize everyone is seeking. So, who will triumph ? Just like George RR Martin’s brilliant re-imagining of the War of the Roses, Lord of the Rings & umpteen other historical Sagas & stories, I fear that the prized seat in Westeros will only ever be held on a ‘temporary basis’…with much money, blood, sweat, tears & other emotions shed along the way. I still worry that our Sun Queen’s ultimate desire is to really put a shed load of her arrows pointed in that direction.

> Challenging the CRR ( Contract Rights Renewal ) not on the agenda

As I stated before I find this really odd ? It’s an antiquated regulation that dates back to 2003, virtually the ‘dark ages’ in terms of modern media. Trading on ‘share of Broadcast budgets ‘ is archaic, means bugger all,  has led to a dark, slimy-grey muddy market , is easily fiddled & sheds little light on ITV’s true competitive performance position. Carolyn defends this stance by adding  ‘she doesn’t want to waste time on this area’ given the regulatory complexities & all the other things she has to do. I think I would always spend time on an area that included £1.8 billion of revenue!  Historically ITV was worried about challenging the CRR rule on the fear this would lead to an open ‘market review’ i.e Agency Deal trading, Station Price etc etc . This fear needs to be overcome & she needs to move on ‘boldly’ in this area. She cites that instead of the CRR review, ITV’s Commercial Team will strive to have more client direct relationships & more creative selling will take place. Again, this appears to me as a rather weak & vague response to what is a much bigger problem.  I was always somewhat shocked that previous CEOs did not have direct relationships with the CEOs of ITV’s top 100 spending Advertisers. With our Sun Queen’s impressive track record , then surely this is an area she will re-address ? It will be interesting to see if Carolyn’s gaze falls directly upon the Commercial Team & she reshapes them into a Sales outfit that can truly ‘win’ tomorrow’s game. My guess is that this will happen, so expect to see big changes in that team across the next couple of months.

As the construction of her pyramids begin then so does the cost cutting with some senior ITV people already ‘leaving’ & I expect more of these announcements in the weeks ahead.

I remain a fan of our Sun Queen , excited by the fact that she is taking action quickly but, as per my comments in my last blog, I am deeply disappointed that she has chosen a ‘stick’ strategy  rather than deciding to ‘twist’.

Episode 3 of our Saga to follow in due course.

Namaste x

 

 

Gary Knight
About Gary Knight
The Sun Queen begins to build her Pyramids