John McVay: Facing the future of the indie sector

As John McVay’s 25-year reign over indie membership body Pact draws to a close, he surveys the current market and is characteristically blunt about the outlook.

“It’s very fragile, it’s still very difficult,” he says, behind the “professional optimism” that indies are forced to display, at least in public, to play down their commercial woes.

While indies might reveal their true difficulties to him behind closed doors – two years on from the catastrophic commissioning slowdown caused by a cocktail of falling ad revenue, lower-than-expected streamer profits and a licence fee freeze – it’s clear that one of McVay’s core frustrations is his sense that neither producers nor PSBs are taking the situation seriously enough.

“There’s less money, so any idea of us going back to anything like 2022 levels is just a joke”

“Look at the numbers on the ad market for this year – they’re down,” he says. “Some people might say, ‘Well, it’s not as bad as last year’, but from 2020, they’re down cumulatively a huge amount.

“That’s the reality we have to face up to. It means there’s less money, so any idea of us going back to anything like 2022 levels is just a joke. It’s tough out there and it will remain tough because the market has changed.”

Pact’s landmark report, published in March this year, sounded an alarm bell about the future of the indie sector if current trends continue – painting a stark picture of an industry where only a select group of the very biggest indies, and a handful of the very smallest, are able to win commissions and survive. As a result, the report warns, the sector will lose out on an eclectic production community as well as diverse talent and output.

The report, McVay says, was sparked by his observations at last year’s Edinburgh TV Festival, where indie bosses repeated the mantra ‘survive to 25’ (“the most banal thing I’ve ever heard,” McVay scoffs) and reassured each other that the industry would bounce back from a ‘routine’ slump. Meanwhile, broadcasters used their spotlight sessions to project business as usual.

“I just got irritated by that, and I thought, ‘none of you are telling the truth’,” McVay says.

He has met with all PSB content heads to discuss the report’s findings, apart from 5’s Ben Frow – an issue of diaries, he hastens to add, not recalcitrance on Frow’s part.

“I challenged them to tell me I’m wrong, and not one of them has been able to,” he notes. “What that report basically was trying to flag up was that the market’s not coming back to how it used to be. This isn’t some sort of cyclical change. There’s a major structural thing going on.”

Off the back of the report, McVay is calling for more transparency from broadcasters on their medium- to long-term commissioning intentions.

He proposes an individual be appointed, potentially by Pact, to collate broadcasters’ content plans for the following two or three years by hours, and publish a summary of what, in aggregate, the PSBs would be commissioning. This, he argues, would make it possible to tell what hours an individual broadcaster was looking for, and so sidestep any competition issues.

“If you could see that 3,000 hours of daytime were commissioned per annum across all the broadcasters previously, and it’s now dropping to, say, 200, it would give everyone a pretty good idea where things are going [for that genre],” he says. “It’s a mature, responsible thing the industry should do.”

He gives short shrift to the notion, put forward by one broadcaster, that everyone in the sector understands the volume and types of programmes commissioners are after.

“Just because you occasionally announce something, or do a panel somewhere, that doesn’t mean people are up to speed with what the market needs going forward,” he says.

The broadcasters he’s spoken to were open to the idea of multi-year transparency, he says, if not exactly enthusiastic.

“They say ‘maybe we’ll do it if they [rival PSBs] do it’,” he explains. “Maybe I can get them to walk up to the line – and then over it. It’s a twinkle in my eye, but maybe that’s something I can do before I depart from Pact”

There is, indeed, a particular gleam as he says it.

Transparency, he adds – warming to his subject – would allow indies to refocus efforts on in-demand genres or invest in alternative income streams.

Currently, too many are telling him they believe the market will return to, if not the post-pandemic boom of 2022, then at least 2019 levels.

His response is plain: “You should be rescaling, retooling, hiring new people, selling your business – whatever, because the sort of work you’re doing may not come back.”

INCLUSIVE INDUSTRY

Many, largely unscripted, companies from the ‘squeezed middle’ have diversified, he notes approvingly, looking abroad for commissions, setting up FAST channels and focusing on growing digital revenues via adapting IP to podcasts or YouTube channels.

McVay has never believed certain producers should inherently be protected from market forces (“no one made them set up a company”) and he’s keen to emphasise that big isn’t necessarily bad, pointing out that larger organisations allow for economies of scale and free creatives from the more mundane aspects of running a company.

At the same time, he’s clear these bigger outfits shouldn’t be the only ones making shows.

“We need to have a range of companies making a range of things with many access points for different talent to remain relevant – if we don’t think like that, then the industry won’t survive,” he warns.

“If we’re going to achieve the inclusive industry we need to attract different creative people and be relevant to all audiences, then we’re going to have to work harder – more so if there’s less money and less commissioning.”

But, he says, indies can’t do it alone. Broadcasters cannot expect indies to rustle up 70% of a show’s budget if the money simply isn’t there, and slashing funding will only create worse conditions and lower pay for freelancers.

“It leaves a big question for the domestic broadcasters: if the market can’t provide the deficit, what are they going to do? How are they going to get stuff made?” he says.

Ultimately, broadcasters will have to assess how thinly they’re spreading funding, and whether some areas need to be cut to properly fund others. He reiterates, transparency will be key.

Despite the gloomy prognostications, McVay is optimistic the industry can remain competitive, creative and entrepreneurial. Within that, he warns there’s a risk broadcasters might seek to unpick the terms of trade, the watershed 2003 settlement that created the indie sector in its current incarnation – arguably the greatest achievement of McVay’s career.

He points to Ofcom’s recent proposal, to allow PSBs to seek the bundling of primary and secondary rights, which the PSBs “thought would be a bloody good idea”, but which media consultant Oliver & Ohlbaum calculated could cost indies £365m a year.

“While I can still breathe, I’ll be fi ghting on behalf of Pact if PSBs try to [turn the clock back on the terms of trade]”

Following lobbying from Pact, Ofcom dropped the proposals. But McVay sees the move as a direct attempt to row back on the terms of trade.

“Ever since we got the terms of trade, broadcasters have been trying to turn the clock back. None of them have ever properly recognised just how beneficial it has been for them… While I can still breathe, I’ll be fighting on behalf of Pact if PSBs try to do that,” he promises.

McVay is due to step down at the end of the year, but he’s clearly not bowing out. He says he’s got no definite post-Pact plans, but will be staying on for a transition period to advise his successor.

“They may choose to do things differently, but I can at least explain why we do things in certain ways,” he says. “After 25 years, I know where all the bodies are buried, and where all the skeletons are.”