Media companies are struggling to fund their productions
reveals Grant Thornton survey
69% of key media figures are currently experiencing difficulty
funding their productions, according to a recent online survey
conducted by leading business and financial adviser Grant
Thornton.
The online poll was conducted during a live webinar recently
held to debate the options available to media companies to maximise
their revenue.
The survey also revealed that 85% of respondents do not have all
of their content tied up with one distributor, indicating the
growing need to diversify risk during the current economic climate.
89% regarded distribution income as a significant part of their
growth strategy. In addition, respondents felt the Asian (72.7%)
market to be the most important sales territory, followed by North
America (54.5), Europe (non-UK 45.4%) and Australia/New Zealand
(13.6%).
Christine Corner, media partner at Grant Thornton says, "The TV
industry is facing unprecedented challenges; a sharp drop in
advertising revenues against the backdrop of a severe economic
slowdown has inevitably impacted companies across the industry and
there has been much talk of cost reductions and restructuring.
Advertising levels are likely to remain flat for the best part
of 2010 and the drastic fall in advertising revenues (by between
15-17% in 2009) has led to the need to increase deficit
funding. We are seeing a growing trend towards companies
seeking alternative sources of funding; including overseas tax
credits, advertiser funding and monies from NGOs and companies
wanting to promote their CSR messages," says Corner.
The panel, consisting of Peter Bazalgette (Media Consultant),
Louise Pederson (All3Media), Justin Thomson-Glover (Artists Studio)
and Thomas Dey (Corporate Finance Partner at Grant Thornton),
also considered how companies can maximise income in their
business through the monetisation of international distribution
rights.
"Monetisation has developed out of all recognition over the last
10 years. The need for media companies to have multiple
sources of revenue is the main driver of this growing trend.
Digital rights are particularly of increasing importance to TV
production company owners.
India and China are key markets. Indian companies have
acquired a lot of post production work recently and are making
strong headway in the UK. Singapore is also an interesting market.
Their current model is to allow foreign ownership of 70% of the
company and have significant government support. These are
some very big territories that have funding and are likely to catch
up with the rest of the market," says Corner.
For further information, please contact:
Marielle Legair, Grant Thornton press office 020 7728 2183