Service presents challenges but offers a welcome revenue stream
We’ve written quite a lot in recent months about ITV’s plans to launch a streaming service, but it wasn’t until heading out to Mipcom, and spending a little time with Carolyn McCall, that I grasped just how significant the strategy is for the business.
If Adam Crozier’s reign as ITV chief executive is most closely associated with supercharging its production arm to reduce the broadcaster’s reliance on advertising revenues, McCall’s could be defined by the plan to add an important third source of income: direct-to-consumer.
Chief execs tend not to label any particular project as their business’s number one strategic priority, for fear of sounding as though nothing else is important. And it is clear that advertising and content production and distribution will be the bedrock of ITV revenues for years to come.
But McCall is convinced that further diversification is required, and that while getting into streaming will be a huge challenge for ITV, it is one that she feels it simply has to take on.
McCall knows it won’t be simple – she must have said ‘it won’t be easy’ half a dozen times during our interview – and there are a number of tricky balancing acts that ITV will have to perform.
ITV will benefit from its vast cross-promotional potential in terms of communicating what viewers can expect if they subscribe to the service
Windowing and rights is a potential minefield, especially where third parties are concerned. Even for content made by ITV Studios for the ITV network, there are questions: will consumers feel comfortable being pushed to a pay service to watch a show 31 days after TX, that until then had been available on free catch-up?
Once it has settled on a model, at least ITV will benefit from its vast cross-promotional potential in terms of communicating what viewers can expect if they subscribe to the service.
All of this is going to take up significant management time, and the likes of Kevin Lygo, Ro Newell and the recently appointed Reemah Sakaan (group launch director of ITV SVoD) will be integral to puzzling out its content strategy.
There are multiple reasons why ITV chose not to bid for Endemol Shine Group – the latter’s considerable debt and its owners’ toppy price among them – but I suspect that one factor may have been the need for a clear strategic focus on getting SVoD right, and not being distracted by the challenges of integrating a huge new acquisition.
There is plenty to do ahead of the SVoD launch, and plenty of sceptics to convince. But ITV is serious about the project – it has not historically focused on hiring data scientists – and it is not going too far to suggest that when the service launches in 2019, it could represent a genuinely new era for the broadcaster.
Chris Curtis is the editor of Broadcast